US Suspends Infosys, Capgemini, and Other Tech Firms From Permanent Labor Certification Program

The United States Department of Labor has suspended several major technology and IT outsourcing companies, including Infosys Limited (NSE:INFY) and Capgemini SE (EURONEXT:CAP), from the Permanent Labor Certification (PERM) program. US Labor Secretary Keith Sonderling announced the decision amid multiple ongoing federal investigations, stating that the government will halt both new and pending permanent labor certification applications for the affected firms. Other companies named in the suspension include Microsoft, Adobe, Cognizant, Tata, Wipro, and HCL. Additionally, the Department of Homeland Security proposed steep new fees for international students seeking Optional Practical Training.

The suspension has drawn a strong response from the US-India Strategic Partnership Forum, which defended the economic contributions of legal immigration. The group highlighted that legal immigration pathways generated 2.1 trillion dollars in household income in 2022 and contributed billions in taxes. It also pointed out that the Indian American community, despite making up only 1.5 percent of the US population, contributes 6 percent of the nation's gross domestic product and co-founded numerous high-growth startups. Government officials, however, argued the measures are necessary to prevent the exploitation of visa programs and protect domestic workers from discrimination.

Investors and industry observers will be monitoring how these restrictions impact the talent pipelines and operational costs of major technology firms. The Department of Homeland Security is accepting public feedback on its proposed student visa fee hikes from October 8 through November 9. The outcome of the active federal investigations into the suspended companies will also be critical in determining whether these suspensions are temporary or could lead to longer-term hiring constraints.