Recent comments from senior federal officials, coupled with a new Executive Order and ongoing enforcement activity, signal that the Trump Administration is preparing to significantly increase scrutiny of employers that utilize the H-1B program. While there has been no announcement eliminating or fundamentally restructuring the H-1B category, the government's messaging is noteworthy because it suggests a shift away from simply adjudicating petitions and toward broader investigations of employer compliance, recruitment practices, wage practices, workforce decisions, and potential fraud.

According to recent public statements, the Department of Labor's Office of Inspector General has issued dozens of subpoenas, executed search warrants, and expanded investigations into alleged foreign labor program abuses. Federal officials have indicated that they are specifically examining issues such as alleged visa fraud, sham job opportunities, worker exploitation, and the use of purported "visa mills." In addition, a September 18 Executive Order directs federal agencies to review labor condition applications and consider whether employers seeking H-1B workers have conducted layoffs involving similarly situated U.S. workers.

These developments come on the heels of several other H-1B-related initiatives, including expanded visa vetting, increased social media screening, heightened scrutiny of outsourcing models, and ongoing discussion of a potential future lottery system that would prioritize higher-paid positions.

Although many details remain uncertain, one message is clear: employers should expect a substantially more aggressive compliance environment over the next year.

HR Leadership Checklist: Five Questions to Ask Before the Government Does:

In light of the Administration's recent actions, employers that sponsor foreign nationals should consider evaluating the following areas now.

1. Have We Conducted Layoffs in the Last 24 Months in Any H-1B Job Families?

The Executive Order specifically directs federal agencies to consider whether employers seeking H-1B workers have laid off similarly situated U.S. workers. As a result, employers should review recent reductions in force, restructuring initiatives, hiring freezes, and workforce realignments involving occupations comparable to sponsored positions. Employers may wish to ensure they can clearly document the business rationale supporting continued H-1B hiring and sponsorship where U.S. worker reductions have occurred.

2. Are Our Level I Wage Positions Defensible?

Entry-level wage classifications have long been a focus of government scrutiny, particularly in cases involving professional positions that appear inconsistent with a Level I designation. Given the Administration's stated emphasis on protecting U.S. workers and its previous discussions regarding wage-based prioritization of H-1B visas, employers should evaluate whether their prevailing wage selections accurately reflect the duties, complexity, supervision requirements, and experience levels required for sponsored positions. In fact, we have seen numerous Request for Evidence (RFE) notice and Notices of Intent to Deny (NOID) challenging this specific topic.

3. Are All Worksite Locations Reflected in Approved Petitions?

Remote work, hybrid work arrangements, client-site assignments, and employee relocations have created compliance challenges for many organizations. Employers should verify that all H-1B employees are working at locations properly covered by Labor Condition Applications and, where necessary, approved amended petitions. A review of worksite documentation can help identify issues before they become the subject of an audit, site visit, or government inquiry.

4. Are Our Public Access Files Audit-Ready?

The Public Access File remains one of the most important compliance documents in the H-1B process. Employers should confirm that required documentation is complete, accurate, and readily available, including wage documentation, posting records, benefit information, and Labor Condition Application materials. Given the Executive Order's directive that agencies review previously submitted LCAs, proactive internal audits may be prudent.

5. Do We Have a Protocol for ICE, USCIS, DOL, or FDNS Site Visits?

Government site visits and compliance inspections are likely to become more common if current enforcement trends continue. Employers should ensure that key stakeholders understand how to respond if government officials arrive at a facility. This includes identifying appropriate points of contact, verifying credentials, understanding document retention procedures, determining who is authorized to speak with investigators, and establishing clear procedures for contacting legal counsel.

What Areas Are Most Likely to Receive Increased Scrutiny?

Based on recent government statements and enforcement activity, employers should expect heightened review of several key issues:

• Labor Condition Application compliance;
• Prevailing wage determinations and wage-level selections;
• Layoffs involving similarly situated U.S. workers;
• Third-party placement and consulting arrangements;
• Specialty occupation eligibility;
• Employer-employee relationships;
• Worksite compliance;
• Public Access File maintenance;
• Recruitment and workforce planning practices; and
• Potential indicators of fraud or worker exploitation.

Particular attention is likely to remain focused on staffing companies, consulting organizations, and employers utilizing large numbers of entry-level H-1B workers, although all H-1B employers may face increased oversight in the coming year.

Recommended Next Steps for Employers

Organizations that rely on foreign national talent should consider conducting a comprehensive H-1B compliance assessment that includes:

• Reviewing all active H-1B Public Access Files;
• Confirming worksite compliance;
• Evaluating prevailing wage and wage-level determinations;
• Reviewing workforce actions involving similarly situated U.S. workers;
• Assessing third-party placement documentation;
• Updating site visit response procedures; and
• Ensuring consistency across immigration, payroll, and HR records.

Bottom Line

At this stage, employers should not view these developments as signaling the end of the H-1B program. Rather, they should view them as a warning that federal agencies are preparing to devote substantially greater enforcement resources to identifying perceived abuse and ensuring compliance with existing requirements. The employers best positioned to navigate this environment will be those that take proactive steps now to review their programs, strengthen documentation, and prepare for heightened government scrutiny.

Cozen O'Connor's Immigration Practice will continue monitoring these developments and advising employers on practical strategies to mitigate risk while maintaining access to critical global talent.