US freezes PERM applications for Indian IT giants: What it means for H-1B workers

The US government has moved to suspend several major Indian IT companies from a key programme that helps skilled foreign workers pursue permanent residency in the country.

The Trump administration on Thursday halted certain green-card applications involving Microsoft, Adobe and several major IT outsourcing companies, while also launching investigations into nine leading US universities. The moves expand an immigration crackdown that the administration says is aimed at rooting out fraud and safeguarding jobs for American workers.

US cracks down on Indian IT firms, freezes PERM applications: What it means for Green Cards

The moves mark a broader crackdown on skilled-worker immigration in the US and could make it harder for foreign tech professionals to secure permanent residency.

US Secretary of Labor Keith Sonderling said, “I am hereby suspending from the Permanent Labor Certification Program some of the largest IT outsourcing firms in the world — Cognizant, Infosys, Tata, Wipro, HCL, and Capgemini”

The move could make it harder for Indian professionals hoping to build careers at these companies in the US.

The US Permanent Labour Certification Programme, commonly known as PERM (Program Electronic Review Management), is a key route for American employers seeking to sponsor foreign workers for permanent residency. Several Indian IT companies use the programme as part of the process of helping eligible employees obtain green cards.

What is PERM?

PERM, short for Program Electronic Review Management, is a US labour certification process that employers generally need to complete before sponsoring a foreign employee for an employment-based Green Card. Unlike a visa application, which is usually filed by the individual, the PERM application is submitted by the employer on the worker’s behalf.

Before applying, the employer must first get a prevailing wage determination for the job and complete a set of required recruitment steps. The aim is to show that permanently hiring a foreign worker will not negatively affect the wages, working conditions or job opportunities available to US workers. If the Labour Department approves the application, the employer can move on to the next stage of the Green Card process.

The date the Labour Department accepts the PERM application generally becomes the worker’s “priority date”. In simple terms, this determines their place in line for an employment-based immigrant visa. That date can be especially important for Indian workers, as the number of people seeking US Green Cards from India is much higher than the number of visas available.

PERM is also different from the H-1B visa. An H-1B is a temporary, non-immigrant work visa that allows US companies to employ foreign professionals in specialised occupations. PERM, on the other hand, is part of the longer process of securing permanent residency in the US.

Why are Indian IT companies facing US scrutiny?

The suspensions are largely tied to the US administration’s argument that companies hiring foreign workers could be taking opportunities away from American workers. The government has also raised concerns about alleged fraud and misuse of foreign-worker programmes.

US Labour Department official Keith Sonderling said the administration wants to end what it describes as practices that have increased reliance on foreign labour.

"…we are ending the fraud that has fuelled reliance on foreign labour. President Trump’s Department of Labour will ensure that American businesses now look first to the most talented workforce in the world, and that’s the American worker,” Sonderling said.

“ This administration knows that American workers are the best and brightest in the world. These jobs that were stolen from them should have gone and will now go to Americans first, not foreigners, and especially not foreign fraudsters…
We are cutting off the head of the snake,” he added.

As per Sonderling, since 2009, the impacted companies have requested permanent residency for almost 3 million foreign workers. “They’ve received over 230,000 H-1B visa approvals, and over 100,000 permanent labour certifications – that’s hundreds of thousands of jobs that were taken from American workers,” Sonderling said.

For Indian professionals already working in the US on H-1B visas, employer sponsorship can be an important part of the path towards permanent residency. A freeze on PERM applications could therefore lead to longer waits and added uncertainty for employees, depending on how far along their Green Card applications are.

The suspension of PERM applications, however, does not mean that an employee’s existing H-1B status will automatically be affected. The bigger concern is the possible disruption to the Green Card process, particularly for workers whose applications are still at the PERM stage.

Indian professionals make up a significant portion of the H-1B workforce, especially across the technology sector. For many of them, any delay in employer-sponsored Green Card processing could mean spending longer in an already lengthy immigration queue.

The latest action comes as the US immigration system faces increased scrutiny, adding another layer of uncertainty for foreign professionals working in the country.

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