US suspends TCS, Infosys, Wipro and others from Green Card labour certification
US Labor Secretary Keith Sonderling on 8 October 2026 suspended six IT outsourcing firms, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL and Capgemini, from the Permanent Labor Certification Program (PERM), as the administration alleged visa fraud. Microsoft and Adobe were also suspended over active federal investigations. PERM is the step through which US employers sponsor foreign workers for Green Cards.
Syllabus: Prelims; GS3 · Liberalisation & Industry; GS2 · Foreign Policies & the Diaspora
Why it matters
Take an Indian software engineer on an H-1B visa at one of these firms who was counting on the employer to sponsor a Green Card. With new PERM filings refused, the engineer cannot get a priority date, and the line is long: in October 2026 only Indians with priority dates before 15 January 2015 can file their Green Card applications in the EB-2 and EB-3 categories. Someone close to the six-year H-1B limit faces a sharper problem, because one route to staying beyond it needs a labour certification filed at least 365 days earlier. Indian-born workers received 70% of H-1B petitions approved in FY 2025, so the burden falls heavily on them. Vice President JD Vance said the suspensions would stay "as long as it needs to".
Prelims pointers
- World Trade Organization (WTO): its General Agreement on Trade in Services (GATS) has four modes: cross-border supply, consumption abroad, commercial presence and presence of natural persons.
- GATS Mode 4: individuals of one WTO member supplying services in another, as employees or self-employed; an annex excludes citizenship, residence and permanent employment.
- Balance of Payments: services trade is recorded as invisible trade in the current account; BoP counts resident to non-resident deals, so Mode 3 sales often escape it.
- GATS in IT services: software delivered remotely from India is Mode 1, a subsidiary abroad is Mode 3, an engineer posted at a client's site is Mode 4.
- US labour certification comes from the Department of Labor and does not guarantee a visa; USCIS, under the Department of Homeland Security, decides the immigrant petition (Form I-140).
- H-1B: temporary non-immigrant visa for specialty occupations; the employer files a Labor Condition Application and pays the higher of the prevailing wage or its actual wage.
- Prevailing wage: the average wage paid to similarly employed workers in an occupation in the area of intended employment; PERM requires one before filing.
- National interest waiver: USCIS may waive the job offer, and so the labour certification, for EB-2 applicants whose work has substantial merit and national importance.
Practise a UPSC-style question
With reference to the Permanent Labor Certification Program (PERM) of the United States, consider the following statements:
1. The application is filed by the employer, not by the foreign worker.
2. Before filing, the employer must obtain a prevailing wage determination and carry out prescribed recruitment.
3. The labour certification is issued by US Citizenship and Immigration Services, a part of the Department of Homeland Security.
Which of the statements given above is/are correct?
- (a) 1 and 2 only
- (b) 2 and 3 only
- (c) 1 and 3 only
- (d) 1, 2 and 3
Show the answer
Answer: (a) 1 and 2 only
1 is correct: a PERM filing is made by the employer on the worker's behalf. 2 is correct: a prevailing wage determination and prescribed recruitment must come before the application. 3 is incorrect: the Department of Labor issues the labour certification; USCIS, under the Department of Homeland Security, handles the immigrant petition that follows.
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