Microsoft responds to White House immigration crackdown as Trump honors Nadella

The Trump administration suspended Microsoft from the federal program the company uses to help foreign workers stay in the U.S. permanently, accusing the tech giant of abusing the system.
The announcement by Vice President JD Vance, during a news conference Thursday morning at the White House, came hours before President Trump gave Microsoft CEO Satya Nadella the National Medal of Technology and Innovation in a ceremony honoring Elon Musk and other tech leaders.
Vance said Microsoft laid off 6,000 American workers last year while getting 6,300 H-1B visas and nearly 3,000 green cards, which he said amounted to replacing U.S. employees with lower-paid foreign workers.
βThere has been no company in the United States, unfortunately, that has abused the system more than Microsoft,β Vance said at the news conference, while adding, βOur message to Microsoft is youβre a great American company, but youβve got to hire great American workers.β
Microsoftβs response: In a statement, the company said 80% of the roughly 6,000 H-1B applications it filed last fiscal year were to extend or change the status of people who already work for the company. The rest were for new hires who were already living in the U.S. legally, a group equal to about 1% of its U.S. workforce.
βThey are not new arrivals to our country,β the company said.
Microsoft said it pays H-1B employees βthe same as any other employees doing comparable work,β that its wages are βamong the highest of all H-1B filings,β and that the vast majority of its U.S. employees are Americans.
The statement didnβt mention the suspension, but the company said it looks forward to βproviding the Administration with additional information.β
Details of the penalty: The suspension covers the Labor Departmentβs Permanent Labor Certification program, known as PERM. Itβs usually the first step when a company sponsors a foreign employee to live and work in the U.S. permanently. To get approved, the employer has to advertise the job and show the government that no qualified American worker was available.
Labor Secretary Keith Sonderling said the department wonβt accept new applications from Microsoft or process the ones it already has pending. The move doesnβt stop Microsoft from applying for H-1B visas, the temporary work visas that many PERM applicants hold.
The department also suspended Adobe and six IT outsourcing firms: Cognizant, Infosys, Tata, Wipro, HCL and Capgemini.
Trump didnβt mention the suspension at the ceremony. Introducing Nadella, he credited him with making Microsoft βan early leader in superintelligenceβ and said, βSatya, we are honored to give you the National Medal of Technology and Innovation. It is so well deserved.β
The official citation honored Nadella βfor his transformative leadership of a critical American technology companyβ and for building the βhyperscale infrastructure that enabled the training and global deployment of American superintelligence.β
Tech industry reaction: The announcement drew pushback in Seattleβs tech community.
βThere has been a continuous, nonstop deluge of immigration-related news leading up to the midterms,β said Xiao Wang, co-founder and CEO of Boundless, a Seattle startup that helps people navigate the U.S. immigration process.
Wang pushed back on Vanceβs characterization of H-1B workers as βforeign indentured servants,β noting there are wage requirements to prevent underpayment of employees. He emphasized the economic benefits of educating and employing the students and workers who seek these visas β and what happens if theyβre discouraged or prevented from coming to the U.S.
βWhat I have been trying to warn folks about is the long-term chilling effects that would be detrimental to the long-term prosperity and competitiveness of the United States,β he said.
Wang said the idea that the layoffs and recruitment of foreign-born workers are linked doesnβt make sense. βLayoffs and hiring are not one for ones of each other, especially at giant companies like Microsoft,β he said.
Someone laid off from a gaming division at Microsoft isnβt interchangeable, for example, with an H-1B employee whoβs an expert in agentic AI for a Copilot role, he said.
Priyanka Kulkarni, founder and CEO of the immigration technology companyΒ Casium, previously worked at Microsoft for more than a decade building enterprise AI technology. She personally navigated H-1B status before becoming a permanent resident.
βI worked alongside people from around the world whose expertise helped build technology used by American businesses every day,β she said, adding, βAmerica wants to lead in AI. That requires attracting and retaining exceptional people, and giving them confidence that they can build a future here.β
Kulkarni called the phrase βforeign indentured servantsβ troubling, and said it exposes a contradiction in the administrationβs action.
βIf the concern is that workers depend too heavily on their employers, blocking their path to permanent residency could deepen that dependence,β she said. βPermanent residency gives people more freedom to change jobs, negotiate pay, and start businesses.β