Microsoft Faces H-1B Scrutiny Amidst Service Outage and Visa Concerns

The Trump administration has recently intensified its scrutiny of Microsoft’s use of the H-1B visa program, coinciding with a major service outage that affected millions of users. Labor Department Inspector General Anthony D’Esposito publicly criticized Microsoft on November 13, 2026, following disruptions to services like Outlook and Teams. This criticism comes after the administration previously questioned the company’s visa practices. While the service outage caused widespread inconvenience, the administration’s actions regarding visa programs are separate and have distinct implications for employees and the company.

H-1B Applications Under Scrutiny Following Service Outage

The recent public criticism of Microsoft’s H-1B application volume by Labor Department Inspector General Anthony D’Esposito occurred shortly after a significant outage impacted the company’s core services. The outage, which began on November 12, 2026, affected Outlook, Teams, Copilot, SharePoint Online, and OneDrive. Microsoft attributed the disruption to an overwhelmed core process on affected servers, emphasizing that there was no indication of malicious activity or a cyberattack. While most services were restored by the morning of November 13, the timing of D’Esposito’s comments, stating “Microsoft can process 6,000 H-1B applications, but processing your inbox is apparently a tougher assignment,” drew a direct parallel between the company’s operational issues and its immigration filings.

Administration’s Concerns About Microsoft’s Visa Use

Vice President JD Vance had previously accused Microsoft of using visa and green-card programs to replace American workers. In October 2026, Vance cited figures of 6,000 American workers laid off, 6,300 H-1B visas obtained, and nearly 3,000 green cards as evidence of this alleged replacement. Microsoft has contested this narrative, stating that approximately 80% of its roughly 6,000 H-1B applications in the last fiscal year were for existing employees seeking extensions or changes in status, not for new hires. The company also noted that applications for new employees generally involved individuals already legally present in the United States. U.S. Citizenship and Immigration Services data indicates that Microsoft received 6,258 H-1B approvals in fiscal year 2025, though this total may include renewals for current visa holders and is not solely a count of new hires. Microsoft President Brad Smith has called the replacement claim “off base,” reiterating that most visa and green-card applications pertain to individuals already employed by the company.

PERM Suspension and Its Impact on Green Card Processes

The administration’s actions also include a PERM suspension, announced on October 8, 2026, which affects eight employers, including Microsoft, Adobe, Cognizant, Infosys, TCS, Wipro, HCLTech, and Capgemini. The PERM (Program Electronic Review Management) process is a critical labor-certification step required for many employer-sponsored green-card applications. This suspension halts the filing of new PERM applications and the progression of pending cases for the named companies. However, it is important to note that previously certified PERMs and approved I-140 petitions are not automatically revoked by this pause.

Crucially, the PERM suspension does not affect current H-1B status or employment. Workers holding H-1B visas retain their status and their jobs remain unaffected by this pause. Individuals can also pursue an H-1B transfer to an employer not included in the suspended group. The uncertainty arises for employees nearing the six-year limit on their H-1B status, as some extensions are contingent on the timing of labor-certification filings or immigrant petitions. The Labor Department has not provided a specific end date for the PERM suspension, advising affected workers to monitor official updates.

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