The Trump administration’s halt on permanent labor certifications for the IT major threatens to deepen the green card backlog for thousands of Indian techies and trigger wider scrutiny across Indian IT exporters.
In a move sending shockwaves through India’s $250-billion IT sector and the vast Indian diaspora in the United States, federal authorities have temporarily suspended IT services giant Cognizant from submitting new permanent labor certification applications. The aggressive enforcement action, targeting the first essential step toward acquiring an employment-based green card, threatens to freeze the long-term career prospects of thousands of Indian tech professionals.
The crackdown was executed by the US Department of Labor in tandem with the White House Fraud Task Force. Announcing the measure, US Labor Department Inspector General Anthony D’Esposito signaled zero tolerance for corporate visa infractions. "Fighting fraud is a TEAM SPORT... @Cognizant’s PERM filings are suspended," D'Esposito posted on social media, adding a stark warning: "Threats to American workers will NOT be tolerated... Handcuffs await." Cloud software firm Cloudera was also hit with a similar suspension under the ongoing nationwide probe into alleged H-1B and green card abuse.
A direct blow to Indian tech talent
The suspension halts all fresh applications under the Program Electronic Review Management (PERM) system. Under US immigration rules, PERM requires employers to demonstrate that no qualified American worker is available for a position before sponsoring a foreign national for permanent residency.
For Indian professionals—who face a massive structural backlog exceeding one million applicants due to country-specific green card caps—any disruption at the PERM stage is devastating. The administrative freeze means Indian engineers at Cognizant cannot initiate their green card process, leaving many stuck on temporary H-1B visas subject to strict renewal deadlines.
Though headquartered in Teaneck, New Jersey, Cognizant was founded in Chennai in 1994 and maintains the vast majority of its workforce in India. While the firm’s reliance on H-1B visas has slowed—securing 3,510 H-1B petition approvals through mid-2026 compared to 9,413 in 2020—it remains one of the top corporate sponsors for Indian tech talent in the US.
Spillover risks for Indian IT giants
The penal action stems from a broad investigation launched by the Trump administration to root out wage manipulation and application fraud within employment-based visa programs. The development comes alongside existing legal challenges for Cognizant, including a federal jury finding that the company discriminated against non-Indian workers.
Industry analysts in India warn that this regulatory freeze could serve as a precursor to heightened enforcement across the entire offshore IT ecosystem. Major domestic tech exporters—including Tata Consultancy Services (TCS), Infosys, Wipro, and HCLTech—rely on identical H-1B and PERM frameworks to deploy and retain skilled talent in their largest market. If federal agencies expand these filing suspensions to other top sponsors, it could disrupt delivery models and trigger unprecedented operational uncertainty for India’s IT export engine.
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