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What American Workers Need to Know

• Microsoft has been suspended from the PERM employment-based green-card process while the federal government investigates alleged visa-program abuse.
• Vice President JD Vance says Microsoft laid off roughly 6,000 American workers while benefiting from 6,300 H-1B visas and nearly 3,000 green cards.
• Microsoft disputes the implication that thousands of foreign workers simply replaced laid-off Americans, saying 80% of its H-1B filings involved existing employees extending or changing their immigration status.

By Samuel López | USA Herald

CALIFORNIA - Microsoft is now at the center of one of Washington’s most aggressive challenges yet to the way major technology companies use America’s employment-visa system.

Vice President JD Vance announced October 8 that the federal government had suspended Microsoft from the PERM permanent labor certification program while an investigation continues into alleged abuse involving foreign workers.

That distinction matters. Microsoft has not been banned from the H-1B program itself. The government action instead blocks the company from submitting new — and according to Labor Secretary Keith Sonderling, processing pending — PERM labor certifications used to move foreign employees toward employment-based permanent residency.

Vance put Microsoft directly in the administration's crosshairs.

He said Microsoft laid off approximately 6,000 American workers while benefiting during roughly the same period from 6,300 H-1B visas and nearly 3,000 green cards. He described the situation as evidence that the immigration system was being used against U.S. workers.

Microsoft says that of approximately 6,000 H-1B petitions it submitted during the last fiscal year, about 80% involved extending or changing the status of employees already working for Microsoft. The company says the remaining new-employee filings represented only about 1% of its U.S. workforce and involved people already legally present in the United States.

Microsoft also rejects the administration's suggestion that foreign workers provide a source of discounted labor. The company says it pays H-1B employees the same as comparable employees doing equivalent work and that its H-1B wages rank among the highest in the technology industry.

That is likely to become one of the central questions in the government's investigation: were American employees actually displaced by foreign workers performing substantially similar jobs, or are the administration's headline numbers combining layoffs, visa extensions, internal status changes and permanent-residency cases that cannot fairly be treated as direct replacements?

The timing is also important.

A September 2026 presidential order instructed federal agencies reviewing H-1B petitions to consider whether sponsoring employers had conducted layoffs during the preceding year that affected similarly situated American workers. It also directed the Labor Department to review previously filed labor-condition applications for possible violations.

Microsoft's case may therefore become an early test of how aggressively that policy will be enforced.

Vance went even further, arguing that employer-sponsored visa workers can become unusually dependent on the companies sponsoring them because losing employment may also jeopardize their immigration status. That dependency, he argued, can weaken workers' bargaining power and suppress wages.

White House border czar Tom Homan has made a similar wage argument more broadly about employers seeking foreign labor, saying employers can be motivated by the ability to work people harder and pay them less.

For American technology workers, the Microsoft investigation is bigger than one corporation.

The administration is effectively asking whether a company should be allowed to tell the federal government it needs foreign labor while simultaneously eliminating American jobs — and whether the existing system has enough safeguards to determine when those two events are genuinely connected.

For Microsoft, the government's allegation is serious.

But the investigation still has to prove the connection.

About the Author

Samuel López is a reporter and news correspondent for USA Herald with more than two decades of experience working in the legal sector. His background includes analyzing state and federal litigation, regulatory issues, insurance matters and complex legal disputes. That experience informs his reporting on government investigations, employment law, regulatory enforcement and the legal consequences facing corporations accused of violating federal programs.

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