On October 8, 2026, Vice President JD Vance and Labor Secretary Keith Sonderling announced that the Department of Labor is suspending 8 major companies from the PERM labor certification program indefinitely. The list of companies includes Microsoft, Adobe, Cognizant, Infosys, Tata, Wipro, HCL, and Capgemini. These companies are often called outsourcers because they provide contract technology work to other businesses.
As per DOL, it will stop processing their pending PERM applications and refuse new filings.
According to the administration, the companies have misused the program to replace American workers with lower-paid foreign workers. PERM labor certification is required for many employer-sponsored EB-2 and EB-3 cases, though not for every employment-based green card case. Because thousands of workers, especially H-1B holders, rely on pending PERM applications to extend their status beyond the 6-year limit, the stakes are high. As a result, employers outside the 8 listed companies are also asking whether they could face similar scrutiny.
While many details still remain unclear, the article below answers the most employer and employee focused questions.
What did the Department of Labor announce on October 8, 2026?
On October 8, 2026, Vice President JD Vance and Labor Secretary Keith Sonderling announced that DOL is suspending 8 companies from the PERM labor certification program indefinitely. Further, DOL will stop processing the companies' pending PERM applications and will not accept new ones. Meanwhile, according to Sonderling, multiple federal investigations into the program are underway.
What is the PERM labor certification program, and how does it fit into the green card process?
PERM is the Department of Labor process that most employers must complete before sponsoring a foreign worker for an employment-based green card.
In a PERM case, the employer must establish that there are not sufficient U.S. workers who are able, willing, qualified, and available for the job in the area of intended employment, and that employing the foreign worker will not adversely affect the wages and working conditions of similarly employed U.S. workers. PERM is often used for foreign workers who are already in the U.S. on H-1B or other temporary visas. If the PERM application is filed early enough, it allows H-1B workers to extend their status beyond the usual 6-year limit. That is one of the key reasons why these suspensions matter so much to employees at these affected companies.
To obtain PERM certification, the employer generally obtains a prevailing wage determination from DOL, tests the U.S. labor market through the required recruitment process, and then files the PERM application. After DOL certifies the application, the employer files the immigrant petition (Form I-140) with U.S. Citizenship and Immigration Services. Once the I-140 is approved, the worker can apply for adjustment of status when their priority date, which is the PERM filing date, becomes current.
Why did the administration say it suspended these companies?
According to the administration, these companies misused the PERM program to replace American workers with lower-paid foreign workers.
Officials said the companies misrepresented their hiring needs on their applications. Vance said the representations the companies made were "fundamentally illegitimate and therefore ultimately illegal."
As for Microsoft, the administration stated that its investigation discovered that the company laid off approximately 6,000 American workers last year while employing about 6,300 foreign employees on H-1B visas.
In defense, Microsoft disputes these claims. As per the company, 80% of its roughly 6,000 H-1B applications in the most recent fiscal year were to extend or change the status of existing employees, and the remaining employees were already legally in the U.S.
How long will the suspensions last?
Under 20 CFR § 656.31(b), DOL has broad authority to suspend PERM processing when an employer is under investigation for possible fraud or willful misrepresentation connected to the PERM program. A final finding of fraud is not required. The regulation permits an initial suspension of up to 180 days and allows extensions while investigations or judicial proceedings continue.
The administration has not yet set an end date for these suspensions, hence they remain indefinite. As for Microsoft’s suspension, Vance mentioned that it would last as long as it needs to.
What do the companies need to do to get reinstated?
The administration has not yet laid out a specific process for companies to get reinstated. Vance has simply mentioned that the companies need to change and improve their behavior. As for Microsoft, the suspension would stay in place until it shows a serious effort to put American workers first. Until DOL releases formal guidance for reinstatement, there is no standard timeline that can be anticipated.
Does DOL have the legal authority to suspend an employer from PERM?
Yes, DOL has the legal authority to suspend an employer from PERM; however only within its designated limits. Under 20 CFR § 656.31(b), DOL can suspend processing of PERM applications when an employer is under investigation for possible fraud or willful misrepresentation. The suspension will remain in effect until the investigation and any related proceedings are complete.
What’s worth noting is that this authority is separate from debarment, which is a more serious penalty. Debarment bars an employer from filing PERM applications for a set timeframe, which generally lasts up to 3 years, and requires a formal finding of a violation along with notice and an opportunity to contest it.
Does the DOL need to prove fraud before suspending an employer?
No final finding of fraud is required for a suspension. However, DOL is allowed to suspend processing when DOL learns of the possibility of fraud or willful misrepresentation involving the PERM program.
However, there must be a concrete basis tied to possible fraud or willful misrepresentation. Instances such as employing multiple foreign workers or conducting layoffs are not enough to justify a suspension. The key question is whether DOL can point to specific conduct, such as misrepresentations in PERM applications or improper treatment of U.S. applicants during the recruitment process. At present, the administration has only described its concerns publicly and has not released the details specifically for each company’s suspension.
Can DOL refuse new PERM filings, or has it only paused processing of pending ones?
This remains one of the biggest concerns for employers. DOL has stated that it will refuse new PERM applications from the above-mentioned 8 suspended companies. The regulation authorizes DOL to suspend processing of “any” application filed by the employer, but it does not mention refusing new filings.
The difference matters. When a PERM application is filed, its filing date generally becomes the worker's priority date, which determines their place in line for a green card. A filed PERM can also allow an H-1B worker to extend status beyond the 6-year limit under AC21, if it has been pending for at least 365 days.
If DOL refuses to accept the filings instead of pausing them, the employees might end up losing both these protections, which could strengthen a legal challenge to the policy.
Can the suspended companies challenge the decision in court?
Yes, the suspended companies can possibly challenge the decision in court. The companies could bring claims under the Administrative Procedure Act (APA). A primary argument could be that DOL exceeded its regulatory authority by refusing new filings, or that the suspensions were arbitrary because they lacked sufficient evidence.
Whether or not a company challenges the decision in court is a separate question. Besides that, there is a possibility for firms to cooperate with the investigation and negotiate reinstatement instead of opting for litigation against the administration. As for Microsoft, it has said it looks forward to providing the administration with the required additional information.
Could DOL expand the suspensions to other companies?
Yes, it is possible for DOL to expand the suspensions to other companies. This is because the regulation that DOL relied on can possibly apply to any other employer under investigation for possible fraud or willful misrepresentation. As per Sonderling’s statement, multiple federal investigations into the program are still underway, which indicates that this may not be the final list of PERM-suspended companies.
Based on the current list, large technology companies and IT staffing and outsourcing firms should watch for possible scrutiny. The risk may be higher for companies that rely heavily on H-1B and PERM, especially those with significant recent layoffs or recruitment practices that could be seen as discouraging qualified U.S. applicants. Having said that, the administration is yet to announce the criteria for selecting such companies.
Conclusion
The PERM suspensions are a significant escalation in the administration’s scrutiny of employment-based immigration, but it is still in its developmental phase.
DOL has an extensive authority to suspend processing during a fraud investigation, yet questions still linger about the basis for each suspension, whether the companies or their employees will challenge the decision in court, and whether DOL’s refusal of new filings will hold up.
For now, employers should review their PERM recruitment practices, especially how they consider U.S. applicants and document reasons for rejection. Affected employees should work with immigration counsel to assess individual cases, specifically employees who are nearing their H-1B maximum stay. We will post updates as DOL releases more guidance.
Disclaimer:
This article is for informational purposes only and does not constitute legal advice.
