What Exactly Is a PERM Suspension?
PERM, which stands for Program Electronic Review Management, is the process through which a US employer must prove to the Department of Labor (DOL) that no qualified and willing American workers are available for a specific job before it can sponsor a foreign
worker for permanent residency, or a green card. On September 8, 2026, the DOL's Inspector General, Anthony D'Esposito, announced that Cognizant's ability to submit new PERM applications had been suspended. This action effectively freezes the start of the green card process for any new cases the company intended to file, pending the outcome of a federal investigation. The suspension itself does not cancel an employee's existing H-1B visa status or a previously approved green card.
The Allegations Behind the Action
The suspension stems from an ongoing investigation into alleged fraud within Cognizant's H-1B and PERM visa programs. While the DOL has not released specific details about the allegations against the company, the probe was reportedly initiated following whistleblower complaints. The Inspector General linked the action to a broader initiative by a White House Fraud Task Force aimed at protecting American workers and eliminating fraud in employment-based immigration programs. Officials have mentioned investigating issues like fraudulent visa applications and illegal wage arrangements, though they have not publicly tied these specific claims to Cognizant. It is important to note that no criminal charges have been filed against the company.
The Immediate Impact on Employees
For Cognizant employees waiting for the company to begin their green card process, the suspension creates significant uncertainty and delay. The company cannot file new PERM applications, which means these employees cannot secure a priority date—the crucial marker that determines their place in the long green card queue. This is particularly concerning for Indian professionals, who already face decade-long backlogs for employment-based green cards. The suspension does not directly affect employees whose PERM applications have already been certified or who have already filed their I-140 petitions. However, the freeze on new filings introduces a major roadblock for those in the initial stages of their permanent residency journey, potentially creating a talent retention risk for Cognizant as employees may consider moving to other companies to avoid a stalled process.
Is This an Isolated Incident?
Cognizant is not alone. The DOL Inspector General also announced a PERM suspension for software company Cloudera. The action against Cloudera, which began earlier in May 2026, followed allegations from the Department of Justice that the company used a recruitment process that discriminated against US workers. While the specific reasons for Cognizant's suspension remain undisclosed, the dual actions suggest heightened scrutiny on tech companies' hiring and immigration practices. Industry experts believe this could signal a wider trend, extending regulatory focus beyond the H-1B program to the entire green card sponsorship pathway, which could have ripple effects for other major IT services firms that rely on foreign talent.
What Happens Next?
The duration of Cognizant's PERM suspension remains unknown. The investigation is ongoing, and key details—such as the number of employees affected and the specific compliance issues under review—have not been made public. As of early September, Cognizant had not issued a formal public response to the suspension. The key developments to watch will be any formal enforcement notice from the DOL, which might clarify the scope and length of the suspension, and the ultimate findings of the federal investigation. Until then, a significant part of the company's immigration pipeline for new green card sponsorships remains at a standstill.
