US Vice President JD Vance announced on Thursday, 8 October 2026, that the Trump administration was suspending Microsoft from a key employment-based green card programme, accusing the company of abusing immigration rules while laying off American workers.
Hours later, President Donald Trump awarded Microsoft CEO Satya Nadella the National Medal of Technology and Innovation, praising his leadership without mentioning the immigration dispute.
The contrasting announcements highlighted a tension within the administration: restricting employment-based immigration while celebrating technology executives driving American innovation.
Microsoft challenged Vance's interpretation of its visa figures, saying most of its H-1B applications concerned existing employees rather than new hires.
Vance Points to 6,000 Layoffs and Thousands of Visas
Vance said Microsoft would be suspended from the Permanent Labor Certification programme, known as PERM.
The process is required for most employment-based green cards and requires employers to demonstrate, among other conditions, that hiring a foreign worker will not adversely affect US workers' wages or employment.
Labor Secretary Keith Sonderling said the government would stop accepting new permanent labour certification applications involving Microsoft and stop processing pending ones.
The action affects Microsoft's ability to use the PERM process to sponsor workers for permanent residency. It does not itself revoke existing H-1B visas.
According to the Associated Press, Vance said Microsoft had laid off 6,000 US workers while obtaining 6,300 H-1B visas and almost 3,000 green cards. He accused the company of abusing the immigration system and replacing American workers with foreign employees.
However, the administration did not publicly establish that the workers represented by those immigration figures directly replaced employees who lost their jobs. H-1B approvals, green cards and layoffs measure different activities and do not, by themselves, establish unlawful hiring practices.
Microsoft Pushes Back on Vance's Numbers
Microsoft challenged the suggestion that thousands of its H-1B applications represented new overseas workers brought in to replace Americans.
The company said about 80% of the roughly 6,000 H-1B applications it filed during the previous fiscal year were 'to extend or change the status of existing Microsoft employees'. It said: 'These were not to hire new people.'
Microsoft said the remaining applications for new employees involved people already legally living in the United States. Those filings represented about 1% of its US workforce, according to the company. It also said H-1B petitions were filed only for employees who met the visa programme's requirements.
Microsoft further said it pays H-1B employees the same as other employees performing comparable work.
Its response challenged Vance's interpretation of the figures, although the longer-term impact of the PERM suspension on affected Microsoft employees remains unclear.
Trump Honours Nadella Hours Later
The administration struck a markedly different tone later that day when Trump presented Nadella with the National Medal of Technology and Innovation during the Science: A New Golden Age summit in Washington.
The White House said Nadella was recognised for his 'transformative leadership' of Microsoft, its rejuvenation during the cloud-computing era and his role in building infrastructure that enabled advanced artificial intelligence.
Trump also praised Nadella's more than three decades at Microsoft and his role in the company's transformation. He did not publicly criticise Microsoft's immigration practices while presenting the award.
Nadella, who immigrated from India, was among six technology leaders honoured that day. Five of the six were immigrants.
Asked earlier about the apparent contradiction, Vance said: 'We're going to continue to support Microsoft and have a great relationship with Microsoft.'
The medal did not reverse the PERM suspension, but the timing highlighted the administration's sharply contrasting messages about one of America's biggest technology companies.
Microsoft Is Not the Only Company Targeted
Microsoft was one of eight companies affected by the crackdown.
Reuters reported that Adobe, Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies and Capgemini were also suspended from the PERM programme.
Sonderling said the companies had collectively sought nearly three million foreign workers since 2009 and received more than 230,000 H-1B visa approvals and more than 100,000 permanent labour certifications. Those historical figures do not, by themselves, establish immigration fraud.
The action forms part of Trump's major crackdown on employment-based immigration.
Supporters of tighter restrictions argue that foreign-worker visa programmes can be exploited to disadvantage American workers. Supporters of the programmes say they allow US companies to recruit specialised talent and fill important skills gaps.
Restricting access to permanent residency could also leave some foreign workers dependent on temporary employer-sponsored status for longer. Vance said the suspensions would last 'as long as it needs to', leaving their duration and other consequences uncertain.
