The United States’ H-1B visa and green-card programs were created to attract highly skilled foreign workers and keep the country at the forefront of technology. One well-known success story is Satya Nadella, who arrived from India, first on a green card and later on an H-1B visa before becoming a U.S. citizen and Microsoft’s chief executive.
Trump and Vance allege abuse
Earlier this month, Donald Trump announced a suspension of the PERM labor-certification process for several firms, including Microsoft and Adobe. He said the companies were exploiting the system that helps H-1B holders obtain green cards.
Vice President Mike Vance added that Microsoft had laid off roughly 6,000 American employees in the past year and replaced them with cheaper foreign workers on H-1B visas and green cards. He described the foreign hires as “indentured servants.”
The PERM program is a key step for an employer to sponsor an H-1B worker for permanent residency. An H-1B visa allows a skilled worker to stay for up to six years, while a green card grants permanent residence and eventually citizenship.
Since taking office, the Trump administration has repeatedly targeted the H-1B system. Last year it imposed a $100,000 fee on each H-1B petition, a rule a federal judge later struck down as illegal. The administration is appealing that decision.
Microsoft refutes the accusations
The company responded by saying it filed about 6,000 H-1B applications in the last fiscal year, and 80% of those were extensions or status changes for existing staff. It emphasized that these were not new hires.
For the remaining applications, the firm noted the candidates were already legally present in the United States and chose to join the organization. It argued that its hiring practices complied with immigration law.
While the H-1B program has been criticized for allowing some firms to replace U.S. workers with lower-paid foreign labor, the evidence varies by company. For example, the tech giant reported sponsoring roughly 1,200 green-card applications in fiscal 2023, mainly for senior engineers and research staff.
Critics of the program point to cases like Disney in 2014, when the entertainment giant shifted several hundred IT positions to overseas workers who received lower wages and required on-the-job training from departing Americans.
The Biden administration has introduced rules aimed at curbing abuses of the H-1B system, targeting firms that hire foreign workers for roles that do not require specialized skills.
The agency’s latest proposal would set the fee at $103,265 per H-1B worker, a figure that could significantly raise the cost of hiring foreign talent.
In addition to targeting large technology firms, the suspension extended to several major outsourcing companies that rely heavily on foreign specialists. Those firms now face barriers to moving temporary visa employees toward permanent residency.
