WASHINGTON / BENGALURU — The United States Department of Labor on October 8, 2026, suspended eight tech and outsourcing giants—including Microsoft, Tata Consultancy Services (TCS), Wipro, Infosys, Cognizant, HCLTech, Capgemini, and Adobe—from participating in the Permanent Labour Certification (PERM) process. Following the unprecedented enforcement action, Zoho founder and CEO Sridhar Vembu issued an urgent appeal encouraging affected Indian professionals to return to India and contribute to the nation’s technological ecosystem.
The administrative action abruptly freezes all new and pending PERM applications submitted by the targeted corporations. PERM certification serves as the mandatory first step for foreign national employees seeking employer-sponsored lawful permanent residency (Green Cards) in the United States.
US Suspends PERM Certification for Major IT Employers
PERM certification is the critical first step for H-1B visa holders seeking permanent residency.
US Labour Secretary Keith Sonderling announced the enforcement initiative alongside officials from the US Anti-Fraud Task Force and Vice President JD Vance.
“I am hereby suspending from the Permanent Labour Certification Programme some of the largest IT outsourcing firms in the world, Cognizant, Infosys, Tata, Wipro, HCL, and Capgemini,” stated Sonderling. He confirmed the federal government will neither accept new PERM filings nor continue processing pending applications associated with the listed entities.
The sanction directly targets high-volume sponsors of H-1B visa holders transitioning toward permanent residency. Federal authorities cited ongoing enforcement audits aimed at protecting domestic wage structures and preventing perceived abuses in labor market certification filings.
| PERM SUSPENSION AT A GLANCE (OCT 2026) | |
|---|---|
| Regulatory Body | US Department of Labor (DOL) |
| Targeted Entities |
Infosys, TCS, Wipro, HCLTech, Cognizant, Capgemini, Microsoft, Adobe |
| Immediate Action |
Complete freeze on new & pending PERM labor certification filings |
| Primary Impacted Group |
H-1B visa holders from India seeking employer-sponsored Green Cards |
Sridhar Vembu Reacts: ‘Let This Be the Birth Pains of a Bold Future’
Responding to the development on X (formerly Twitter), Zoho’s Sridhar Vembu underscored the strategic contribution of Indian engineers to American innovation while pointing to shifting political and immigration sentiments.
“Indians have made a major contribution to America’s technological prowess. Yet, a big part of America no longer wants us,” wrote Vembu.
Addressing foreign workers confronting visa ambiguity, Vembu highlighted the opportunity for India to capture top-tier engineering talent:
“Indians who are on a visa in the US face the painful prospect of uprooting the life you have built with hard work. Let this be the birth pains of a bold new future. Come back, let’s build India.”
Vembu’s public appeal reflects an accelerating sentiment among Indian business leaders advocating for reverse brain drain, urging high-skilled professionals to leverage their global experience within India’s expanding SaaS, AI, and enterprise tech sectors.
Strategic and Macroeconomic Implications for Indian IT
The PERM suspension introduces immediate structural operational hurdles for global IT service providers and American technology multinationals dependent on Indian specialized talent.
- Immigration Bottlenecks: Without PERM approval, foreign workers nearing the standard six-year ceiling on H-1B visas cannot secure Form I-140 immigrant petition approvals, preventing further H-1B extensions beyond six years under AC21 regulations.
- Talent Re-allocation: Major service providers may be forced to redeploy senior architects, software engineers, and project leaders to offshore delivery centers across Bengaluru, Hyderabad, Pune, and Chennai.
- Expansion of GCCs: Global Capability Centers (GCCs) operating in India stand to gain significant leadership talent as companies migrate key engineering functions closer to talent bases outside the US jurisdiction.
What Happens Next: Industry Outlook
The legal validity and timeline of the Department of Labor’s suspension remain subject to anticipated legal challenges from corporate trade associations and immigration advocacy groups. Affected IT service providers are reviewing existing workforce deployment models to mitigate client-side disruptions.
For thousands of Indian tech professionals facing extended green card wait times compounded by regulatory freezes, the shift highlights the growing viability of domestic career trajectories inside India’s enterprise technology ecosystem.
Manish Kumar began his professional journey in digital marketing and performance marketing, and currently works as a Digital Marketing Excutive and SEO expert. With over 3 years of professional experience, he handles both strategy and execution. Currently, he manages digital marketing and performance marketing at ‘Shabd Sanchi’ (shabdsanchi.com).
Frequently Asked Questions (FAQs)
Q1: What is the PERM process in the US Green Card pipeline?
The Permanent Labour Certification (PERM) issued by the US Department of Labor verifies that no qualified US workers are available for a position, serving as the mandatory initial step before filing an I-140 immigrant petition.
Q2: Which companies are banned from the PERM process?
The US Department of Labor suspended PERM participation for Microsoft, Adobe, Tata Consultancy Services (TCS), Wipro, Infosys, Cognizant, HCLTech, and Capgemini.
Q3: How does the PERM freeze impact H-1B visa extensions?
H-1B visa holders typically need an approved PERM and I-140 petition to extend their stay beyond the six-year statutory maximum; a freeze restricts extensions for long-term workers.
Q4: What was Sridhar Vembu’s advice to Indian tech workers in the US?
Zoho founder Sridhar Vembu urged Indian professionals facing US visa uncertainties to return to India and contribute to building the nation’s domestic technology industry.
Q5: Can affected companies appeal the Department of Labor’s PERM suspension?
Yes, affected corporations and legal representatives can pursue administrative appeals or file federal lawsuits challenging the regulatory enforcement action.
