Mint Explainer | What a green card freeze means for H-1B workers

Summary

The suspension of green card processing for Microsoft, Adobe, Infosys, TCS, Wipro, HCLTech, Cognizant and Capgemini may complicate talent retention and hiring. Companies could rely more on temporary visas, US-based hiring and offshore delivery while investigations continue.

The US administration has suspended green card processing for Microsoft Corp., Adobe Inc., Infosys Ltd, Tata Consultancy Services Ltd (TCS), Wipro Ltd, HCL Technologies Ltd (HCLTech), Cognizant Technology Solutions Corp. and Capgemini SE while it investigates alleged misuse of employment-based immigration programmes. The move could reshape hiring, mobility and offshore delivery models. Mint decodes:

What is the US administration's order for information technology (IT) workers?

On 8 October, the US Department of Labor suspended new and pending applications under Program Electronic Review Management (PERM), commonly called Permanent Labor Certification, for eight companies: Microsoft, Adobe, Infosys, TCS, Wipro, HCLTech, Cognizant and Capgemini.

PERM is the first step to convert H1-B work visas into employer-sponsored green cards. A green card is an identity document that permits non-American citizens to live, work and study permanently in the US. US vice-president JD Vance characterized H1-B workers as "foreign indentured servants." India's external affairs ministry termed the statement as "unwarranted and deeply offensive."

The US administration action to suspend green card processing is linked to investigations into alleged abuse of H-1B and green card processes amid concerns around displacement of American workers.

How will this impact companies and workers?

The immediate impact falls on workers whose green card and subsequently American citizenship depend on PERM sponsorship from the affected employers. H-1B holders can continue working. The order does not automatically revoke existing visas or green cards. However, employees awaiting PERM approval may face delays and greater uncertainty about permanent residency. For companies, the measure complicates talent retention because the promise of a green card is a major incentive for skilled workers. Companies may need to rely more heavily on temporary visa extensions, alternative visa categories, local hiring or overseas staffing models until the investigations into abuse of H1-B are resolved.

Will it lead to more work going offshore?

Potentially, yes. Indian IT services firms built their operating model around a mix of onsite client-facing staff and large offshore delivery teams. Even global capability centers (GCCs) are scaling up work in India. If green cards become tougher, companies may reduce the number of employees sent to the US, and expand work done from India and other global delivery centers. The likely outcome is a stronger emphasis on remote delivery where feasible, combined with increased local hiring in the US for roles that require physical presence.

How important is it for IT workers to be onsite now?

The pandemic proved that a significant share of IT work can be delivered remotely, but onsite staff remain important in several areas. These include client consulting, analytics, project governance, change management, cybersecurity operations involving restricted systems, regulatory compliance, executive stakeholder engagement and large-scale digital transformation projects. IT workers are also often needed onsite during initial project discovery, architecture design, crisis remediation and major software deployments. Cloud platforms, artificial intelligence (AI) tools and collaboration technologies have reduced the need for physical presence, yet customer-facing roles and strategic decision-making functions require proximity to clients. Therefore, demand for onsite talent has declined, but not disappeared.

Can all the work be done in remote locations offshore?

Routine software development, testing, maintenance, application support, analytics and many back-office technology functions can often be performed offshore. However, some activities remain difficult to relocate completely. These include work that involves sensitive government systems, regulated industries such as defence, healthcare and banks; projects requiring access to secure facilities and assignments that need continuous interaction with client teams. Cultural context, time-zone alignment and rapid problem resolution are also factors that favor onsite teams.

Most global work is delivered through hybrid models, where architecture, consulting and client management may be local while engineering execution is distributed across offshore centers. Complete offshore delivery is rare.

How does this benefit the US and American jobs, if at all?

The administration argues that stricter scrutiny of PERM and H-1B use protects American workers. It ensures companies first recruit qualified US candidates and discourages the use of foreign labour to reduce costs. Officials contend that some companies relied excessively on visa programs while conducting layoffs or restructuring. If the policy succeeds, it could encourage greater domestic hiring, higher wages in some skill categories and increased investment in workforce training. However, highly skilled immigration helps address talent shortages, supports innovation and strengthens US competitiveness.

The ultimate impact will depend on whether employers substitute American workers for foreign talent or simply shift more work overseas.