Infosys Faces DOJ Investigation Over H-1B Visa Filing Practices

Infosys disclosed a DOJ investigation into its H-1B visa filings, centered on how it classified certain employees working for a client in immigration documents submitted to U.S. authorities.

The company repeated the disclosure in its quarterly filing for the period ended June 30, 2026. The same matter appeared in its 2026 filing, which said the company cannot predict the outcome.

The investigation remains active. The filings concern employee classifications, not a reported finding that the company violated immigration law.

A separate federal action also names the company. On October 8, 2026, Vice President JD Vance and federal officials announced a suspension of PERM labor-certification processing for eight employers.

The PERM pause covers eight employers, not the visa system

The administration’s action targets the named employers, rather than stopping labor certifications nationwide. It does not end the H-1B or J-1 programs, and does not itself cancel existing visas or green cards.

The Friday Times reported that the probes began in July 2026 after whistleblower complaints, then expanded through field checks and subpoenas. It also reported employee complaints that the company was not processing their H-1B extensions.

A certified PERM can still support an I-140 petition

The immediate distinction for affected employees is whether the Department of Labor has certified their labor application. A certification already granted should remain intact and can support a later I-140 petition.

An approved immigrant petition is generally not undone automatically by an employer’s suspension, though employer decisions or specific fraud findings could affect a case. If PERM has not been filed or certified, that route is paused for the suspension’s duration.

A worker who remains in valid H-1B status generally keeps that status. Travel, visa stamping and extensions may require careful, current advice because scrutiny could rise.

The pause mainly affects employees with green-card applications underway or planned. The named technology companies employ many Indian IT professionals in the United States on H-1B visas who later seek employer-sponsored permanent residence.

Officials cited investigations but disclosed no company-specific findings

Labor Secretary Keith Sonderling announced the suspension, citing ongoing criminal and federal investigations. He did not disclose company-specific findings or details of alleged violations.

Sonderling said the work included Department of Labor Inspector General Anthony DiEsposito. He said Microsoft and Adobe were included because they faced multiple active federal investigations.

Since 2009, the eight companies collectively requested almost three million foreign workers, received more than 230,000 H-1B visa approvals and secured over 100,000 permanent labor certifications, Sonderling said.

“That's hundreds of thousands of jobs that were taken from American workers.”

Attorney General Todd Blanche said the Justice Department was investigating companies suspected of favoring foreign workers over American employees. He said enforcement could include criminal prosecutions and civil lawsuits.

Vance accused employers of using H-1B to replace American workers with lower-paid foreign employees. He said the program should bring skilled overseas professionals into jobs American workers could not fill.

He singled out Microsoft, accusing it of laying off 6,000 American workers while benefiting from 6,300 H-1B visas and nearly 3,000 green cards.

“You're a great American company, but you've got to hire great American workers. You cannot lay off American workers and then replace them with foreign indentured servants.”

Vance also said, “If you do the math, for every worker that Microsoft laid off, they replaced that worker with one and a half foreign indentured servants.” He said the suspension would continue “for as long as necessary” and urged Congress to reform the H-1B system.

The administration said it wanted the companies to change hiring practices rather than leave the U.S. market. Vance said it had options to extend the suspension indefinitely. The named employers have not been found to have violated the law; the investigations remain unresolved.

Microsoft and NASSCOM defended their hiring and mobility practices

Microsoft said it files H-1B petitions only for workers who meet the category’s rigorous standards and pays wages among the highest in the technology sector. It said its H-1B employees receive comparable compensation to colleagues doing similar work.

“We pay our H-1B employees the same as any other employees doing comparable work.”

The company said it builds its workforce by hiring Americans and attracting talent from around the world. It pledged to give the administration more information about its migration initiatives.

NASSCOM, India’s technology industry body, said immigration and skilled-talent mobility should be considered separately. It said Indian technology companies had reduced reliance on H-1B visas while increasing local hiring and building U.S. workforces.

The group said its members work with a majority of the US fortune 500 companies, support innovation and growth, and generate local jobs. It characterized the number of employees moving from H-1B status to permanent residency through PERM as relatively limited.

Indian minister of state Vardhan Singh said last year that “skilled talent mobility has long played a significant role in promoting technology advancement, innovation, economic growth, and wealth creation in both India and the United States.” Microsoft CEO Satya Nadella previously held an H-1B visa. Microsoft has fired over 20,000 staff since early 2025.

The current probe comes amid a separate history of immigration enforcement. In an earlier Eastern District of Texas case, the government alleged the company knowingly used B-1 visa holders to perform skilled work that otherwise would have gone to U.S. citizens or H-1B workers.

The government said the alleged conduct aimed to increase profits, reduce visa costs, allow greater employee mobility, gain a competitive advantage and avoid tax liabilities. A settlement required the company to pay $34 million, described as the largest payment ever levied in an immigration case.

The agreement also required additional I-9 auditing, reporting on B-1 use, detailed invitation letters and corporate discipline for employees who violated U.S. immigration law. Former Eastern District of Texas prosecutor Shamoil T. Shipchandler led the investigative team.

Then-DHS Secretary Jeh Charles Johnson recognized Shipchandler with the Secretary’s Meritorious Service Award, Silver Medal, on October 21, 2014, in Washington, D.C. U.S. Attorney John M. Bales announced the recognition. The Justice Department’s announcement covered the award.

A separate False Claims Act case ended in dismissal. In United States of America, ex rel. Gregory Handloser v. Infosys Limited, Civil No. 4:20-CV-275-SDJ, E.D. Tex., Sherman Division, District Judge Sean D. Jordan granted the company’s motion to dismiss on July 21, 2025.

The relator, Gregory Handloser, worked as a sales manager from August 2004 until his termination in December 2012. He alleged the company underpaid H-1B workers to reduce federal tax obligations and obtained cheaper L-1 visas for H-1B employees to cut application fees.

The court held that the allegations failed to state a claim. It ruled the company had no False Claims Act obligation to pay higher payroll taxes on wages it never paid or fees for applications it never filed.