Microsoft Is Suspended From Green Card Program. Vance Accuses Company Of H-1B Abuse.

Microsoft is being suspended from a federal program used by employers seeking green cards for foreign workers, with Vice President JD Vance accusing the company of abusing employment-based immigration rules and displacing American workers.

The action was announced Thursday at a White House news conference, according to AP, which reported that the Trump administration accused Microsoft of fraud in its use of the process.

The suspension concerns permanent labor certification, commonly known as PERM, rather than Microsoft's ability to employ workers through the H-1B visa program generally.

Under the Department of Labor process, companies seeking permanent residency for foreign workers usually must first obtain a labor certification showing that there are not enough qualified U.S. workers available for the job and that hiring the foreign worker will not hurt the wages or working conditions of comparable American employees.

H-1B visas, by contrast, allow companies to temporarily employ foreign workers in specialty occupations. Some H-1B workers later pursue permanent residency through employer-sponsored green card applications that require PERM certification.

Vance said Thursday that Microsoft had laid off American employees while continuing to employ foreign workers.

"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 administration has not publicly detailed the evidence behind that calculation.

Vance said the government's message to large U.S. companies was that they should prioritize hiring American workers.

Microsoft did not immediately respond to AP's request for comment.

The action comes as the administration steps up enforcement across several programs that allow foreign students and workers to live or work in the United States.

In September, President Donald Trump extended restrictions on certain H-1B workers for another year, saying the program had been used by some employers to replace U.S. workers with lower-paid foreign labor.

The White House extended a requirement that certain H-1B petitions for workers outside the United States be accompanied by a $100,000 payment, subject to national-interest exceptions.

A separate White House order directed federal agencies to increase coordination and enforcement around the H-1B system.

The administration said government investigations had identified cases involving displacement of U.S. workers, misrepresentation of job requirements and questionable foreign qualifications. Those findings formed part of the administration's justification for tightening oversight of the program. The Microsoft action involves a different part of the immigration system.

PERM is administered by the Labor Department's Office of Foreign Labor Certification and is generally the first major step for employers seeking employment-based permanent residency for foreign workers.

The Labor Department requires employers to test the U.S. labor market before receiving certification, including conducting recruitment and showing that qualified American workers were not available for the position.

Government enforcement against companies using PERM is not unprecedented. In May, the Department of Labor suspended processing of permanent labor certification applications from data software company Cloudera for 180 days after the Justice Department alleged the company had used a recruitment process that prevented qualified U.S. workers from applying for technology positions.

The administration is also tightening rules affecting international students seeking U.S. work experience.

A Department of Homeland Security proposal published this week would require universities to pay $70,000 when first recommending an international student for Optional Practical Training, or OPT, and $30,000 for subsequent periods of training.

OPT allows students with F-1 visas to temporarily work in jobs connected to their field of study. The proposed fees are not yet in effect and remain subject to the federal rulemaking process. Vance also said that nine universities warranted further investigation over their use of J-1 exchange visas.

Microsoft is one of the biggest U.S. technology companies and has long relied on highly skilled workers in areas including software engineering, cloud computing and artificial intelligence.

The Labor Department processed more than 112,000 PERM applications during the first three quarters of fiscal 2026, including more than 104,000 certifications, according to Department of Labor data. Software developers alone accounted for more than 23,000 of the certifications, or about 23% of the total.

Microsoft shares were little changed Thursday after the announcement. The stock was trading around $529.70, after closing Wednesday at $529.76, and has gained roughly 7.5% over the past month.