‘Indian IT firms comply with local laws’: Nasscom defends industry after US PERM freeze

What did the US Department of Labor suspend, and which major Indian and US technology companies were affected?

The US Department of Labor temporarily suspended several major technology companies from filing new applications under the Permanent Labor Certification, or PERM, programme. PERM is used in employment-based green-card cases, so the decision affects a specific permanent-residency pathway rather than every immigration route.

The companies named include Indian technology and outsourcing firms Cognizant, Infosys, Tata, Wipro, HCL and Capgemini. US technology companies Microsoft and Adobe were also suspended. The Labour Department described the affected firms as some of the largest IT outsourcing and technology companies.

The suspension followed multiple active federal investigations. US officials also alleged that foreign-worker programmes had been abused to replace American workers. Nasscom said Indian technology companies would continue following applicable US regulations, while stressing that immigration and skilled-talent mobility should not be treated as the same issue.

What is PERM, and how does it fit into the process of getting an employment-based US green card?

PERM, or Permanent Labor Certification, is a Department of Labor process used in the employment-based green-card pathway. It does not itself grant permanent residency. Instead, it is a required labour-certification step that lets an employer move forward with an immigration petition.

The employer advertises the position, considers applicants and records why qualified US workers were not selected. It must also show that hiring a foreign worker will not harm wages or working conditions. If the Department of Labor certifies the application, the employer can proceed with the immigration petition.

The suspension matters because affected employers cannot file new PERM applications during the temporary restriction. That may delay or create uncertainty around workers whose employers are sponsoring permanent residency. It does not automatically cancel an existing employee’s ability to work, according to the related reporting described in the article.

How is PERM different from the H-1B visa, and why does Nasscom say immigration and skilled-talent mobility are separate issues?

H-1B and PERM serve different purposes. H-1B is a temporary work visa for eligible foreign workers. PERM is a labour-certification step in the employment-based green-card process. One concerns temporary work authorization, while the other supports an employer’s effort to pursue permanent residency for a worker.

For example, a technology company may use H-1B workers to address short-term skill gaps. Separately, it may begin a PERM case by advertising a job, reviewing applicants and showing that hiring a foreign worker will not weaken wages or working conditions. Certification allows the employer to proceed with an immigration petition.

Nasscom says the issues should not be viewed through one lens. It says Indian technology companies have significantly reduced H-1B reliance, expanded local hiring and built a strong US workforce. It also says relatively few employees transition from H-1B visas to permanent residency through PERM.

What happens to workers who already have jobs or H-1B visas when their employer can no longer file a new PERM application?

A temporary suspension of new PERM filings does not automatically terminate an employee’s existing ability to work. The article distinguishes the blocked green-card step from the separate arrangements that allow someone already to hold a job or work visa.

The practical concern is for workers whose employers are sponsoring permanent residency. Their employer may be unable to start a new PERM application while the suspension remains in place. The usual PERM process requires job advertising, applicant review and documentation showing that qualified US workers were not selected.

That can create uncertainty and delay in the permanent-residency process, even though the worker’s existing job or H-1B situation is not automatically ended by the suspension. The article does not state how long the suspension will last or describe the outcome for each individual case. Nasscom said the industry would continue complying with US regulations.

How large is the Indian technology industry’s US presence, in terms of local hiring, work with Fortune 500 companies, and operations in more than 80 countries?

The article presents Indian technology companies as deeply established in the United States. Nasscom says they have steadily expanded local hiring and built a strong domestic workforce there. It does not provide a specific employee total, but it describes local hiring as a central part of their US presence.

Nasscom also says Indian technology companies work with a majority of Fortune 500 companies in the United States. Those relationships help US businesses innovate and grow, while generating more local jobs. This is the industry’s example of economic activity extending beyond foreign-worker visas.

The companies’ global reach is also broad. Nasscom says Indian technology companies operate in more than 80 countries and consistently commit to local laws and regulatory requirements. It says their H-1B dependence has fallen over time. The article gives no precise US hiring figure, so the scale is described qualitatively rather than by headcount.

Why did US officials suspend these companies from the PERM programme, and what allegations or investigations did they cite?

The US Labour Department said the suspension was linked to multiple active federal investigations. It applied to several large IT outsourcing firms and also to US technology companies Microsoft and Adobe. The department did not, in the supplied article, detail the findings of those investigations.

US officials also alleged that companies had abused foreign-worker programmes to replace American workers. At a press conference on fighting visa fraud, the US Vice President specifically criticised the H-1B programme. He said it was intended for positions impossible to fill with American workers but had become rife with fraud.

The allegations explain the government’s scrutiny, but they are not presented as final findings against every named company. Nasscom responded that Indian technology companies follow applicable US regulations and would continue doing so. The industry body also stressed that immigration and skilled-talent mobility are distinct issues.

Why do governments require employers to show that hiring a foreign worker will not displace qualified local workers or weaken wages and working conditions?

The labour-certification requirement makes employers examine the US labour market before sponsoring a foreign worker through PERM. It matters because the process is designed to show that the position cannot simply be filled by a qualified US worker who was unfairly bypassed.

The employer advertises the job, considers applicants and documents why qualified US workers were not selected. It must also show that hiring the foreign worker will not harm wages or working conditions. These steps give the Department of Labor a basis for deciding whether to certify the application.

If certification is granted, the employer may proceed with an immigration petition. The article presents this as the mechanism for protecting both local employment opportunities and labour standards. The suspension means affected employers cannot file new applications through this pathway, while investigations examine alleged misuse of foreign-worker programmes.

Key Facts:

📌 The suspension targeted new PERM applications.

📌 Cognizant, Infosys, Tata, Wipro, HCL and Capgemini were named.

📌 Microsoft and Adobe were also suspended.

📌 PERM is a labour-certification step in employment-based green-card cases.

📌 PERM itself does not grant permanent residency.

📌 Employers must document why qualified US workers were not selected.

📌 H-1B is a temporary work visa.