Stories
US Freezes PERM Applications: Why Indian IT Giants Will Likely Escape Major Impact
- •The US Department of Labor has suspended new and pending PERM labor certification applications involving six major Indian IT firms including TCS and Infosys.
- •A report by Kotak Institutional Equities indicates that operations and earnings will not face significant impact due to increased local hiring in recent years.
- •Visa-dependent employees represent a declining share of the US workforce for these IT firms, mitigating immediate operational risks.
- •Prolonged suspension could create challenges for employees seeking H-1B visa extensions beyond the standard six-year limit.
- •Risks would only escalate if US restrictions extended to existing work authorizations, client-site deployments, or broader outsourcing arrangements.
Key Questions Answered
Kotak Institutional Equities reports that Indian IT companies have significantly increased local hiring in the US over recent years, making visa-dependent employees a small and declining share of their workforce. This localized delivery model helps limit the immediate financial and operational risks from the suspension.
The US Department of Labor has halted new and pending PERM applications involving major Indian IT firms including Tata Consultancy Services (TCS), Infosys, HCLTech, Wipro, Cognizant, and Capgemini, alongside global tech companies Microsoft and Adobe.
The suspension may complicate immigration planning for workers seeking H-1B visa extensions beyond the standard six-year limit, as qualifying PERM or I-140 filings are typically used to secure these extensions. However, the measure does not directly revoke existing H-1B approvals or impact workers who already have approved I-140 petitions.
