A September 18 executive order directs federal agencies administering the H-1B program to consider whether a sponsoring employer has engaged in layoffs during the previous year or plans future layoffs that negatively affect similarly situated U.S. workers when processing H-1B labor condition applications, petitions, visas and entry.
For Indian professionals, this is potentially significant because it places employer workforce decisions more explicitly inside coordinated H-1B scrutiny. But the order does not say that every employer that conducted layoffs is automatically barred from sponsoring H-1B workers.
What does the order require?
The order directs State, Labor and DHS to coordinate with Commerce, Education and the Small Business Administration when administering H-1B cases. Those agencies are instructed to consider relevant wage, employment, academic and economic information.
Most importantly, agencies must take into account whether the sponsor directly or indirectly conducted layoffs within the prior year or plans layoffs negatively affecting similarly situated U.S. workers.
Does a layoff automatically mean denial?
The text does not establish a simple rule saying “layoff equals H-1B denial.” Instead, it directs agencies to take layoffs into account within existing statutory administration.
How agencies operationalize that instruction what documentation they request, which layoffs are considered sufficiently connected to an H-1B position and what consequences follow may become clearer through rules, policy memoranda or adjudications.
DOL gets a separate assignment
Within 30 days, the Labor Secretary, through the Wage and Hour Division, must begin reviewing data related to previously submitted LCAs to determine whether further action against sponsoring employers is warranted under the INA. That provision could matter to employers well beyond new cap cases because the review concerns previously submitted LCAs.
What claims does the administration make?
The order states that certain employers, third-party placement businesses and outsourcing firms have used H-1B workers to undercut or displace U.S. labor and alleges various wage, job-description and credential abuses. Those are the administration’s stated findings and rationale. They should not be treated as a finding that all outsourcing firms or all H-1B employers violate the law.
What should employers review now?
Employers contemplating H-1B sponsorship should document the business rationale for the position, job duties, wage level and relationship between any recent layoffs and the sponsored role.
White House – H-1B program-integrity executive order
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