The Trump administration is suspending tech giant Microsoft from a program that allows companies to apply for green cards for workers on H-1B visas, accusing the company of fraud.
Vice President JD Vance announced the decision Thursday at a White House news conference, saying Microsoft had abused the Labor Department’s PERM program, which is the first step for employers seeking to sponsor foreign workers for permanent residency.
“If you do the math, for every worker that Microsoft laid off, they replaced that worker with one and a half foreign indentured servants,” Vance said.
The Accusations
Vance said Microsoft laid off roughly 6,000 American workers last year while employing 6,300 workers on H-1B visas and nearly 3,000 green cards.
“There has been no company in the United States, unfortunately, that has abused this system more than Microsoft,” he said . “Our message to Microsoft is: You’re a great American company, but you’ve got to hire great American workers. You cannot lay off American workers and then replace them with foreign indentured servants”.
The administration alleged that Microsoft misrepresented its needs when applying for permanent residency for foreign workers, arguing the program is meant only for workers with “hyper-specialized” skill sets that cannot be easily found in the US.
Other Companies Affected
Labor Secretary Keith Sonderling said the administration is also suspending Adobe and several major IT outsourcing firms from the PERM program, including Cognizant, Infosys, Tata, Wipro, HCL, and Capgemini.
The move puts some of the world’s largest technology companies at the center of the Trump administration’s widening crackdown on the H-1B visa system.
The Timing
The announcement came hours before President Donald Trump was scheduled to award Microsoft CEO Satya Nadella the National Medal of Technology and Innovation, the nation’s most prestigious technology award.
Vance downplayed the apparent contradiction. “Our message to Microsoft is not that we want to harm your company,” he said. “It’s that we want your company to thrive, but we want it to thrive by employing and empowering your fellow Americans”.
He added that the administration would continue to “support Microsoft and have a great relationship with Microsoft” but would deny them the ability to apply for permanent residency “until they show that they are going to get serious about putting American workers first”.
The Broader Crackdown
The H-1B program has long been a target of Trump supporters who say it undercuts American workers. H-1B visas are meant for high-skilled jobs that are difficult to fill with American workers. Technology companies are the biggest users, with nearly three-quarters of approvals going to workers from India.
The administration has also targeted universities. Vance said nine elite universities, including Harvard, Yale, Stanford, and MIT, would be investigated for alleged J-1 visa fraud, accusing them of using the program to bring in cheaper foreign researchers.
The Bottom Line
The Trump administration has suspended Microsoft from the PERM green card program, accusing the company of fraud and replacing American workers with H-1B visa holders. Adobe and several major IT outsourcing firms were also suspended. The move comes hours before Microsoft’s CEO was set to receive the nation’s top technology award. The administration says it wants companies to hire American workers, not “foreign indentured servants.”
My Opinion
Vance is right about one thing: the H-1B system has been abused. Companies have used it to import cheaper labor while laying off American workers, and Microsoft, with 6,000 layoffs and thousands of visa holders on its payroll, is a fair target for scrutiny.
But the phrase “foreign indentured servants” is not a policy argument. It is a slur dressed up as rhetoric. H-1B workers are not indentured servants. They are engineers, researchers, and developers who came to this country legally, pay taxes, and contribute to the economy. Many of them are trapped in a system that ties their visa to their employer, which gives companies enormous leverage over them. If Vance wants to fix that, he should talk about reforming the system, not demonizing the workers.
There is also a contradiction here that the administration has not explained. Hours after suspending Microsoft from a green card program, Trump was scheduled to give its CEO the nation’s highest technology award. You cannot punish a company and honor it on the same day without looking like you are sending mixed signals.
The H-1B program needs reform. Companies should not be allowed to replace American workers with cheaper foreign labor. But reform should target the companies that game the system, not the workers who are trying to build a life here. Vance’s message would be stronger if it focused on the fraud and left the dehumanizing language behind.
