New H-1B Executive Order: Why Employer Layoffs Now Draw Closer Federal Scrutiny

A new executive order signed on September 18, 2026 directs federal agencies to weigh an H-1B sponsoring employer's recent or planned layoffs of U.S. workers when reviewing that employer's H-1B petitions and labor condition applications, and it separately extends the $100,000 supplemental H-1B fee requirement through September 2027, although that fee remains blocked in federal court and is not currently being collected.

If your employer sponsors your H-1B status, or if your company sponsors H-1B workers, this order is worth understanding now, even though most of its real-world effects will unfold over the coming months as agencies write the guidance and rules the order calls for.

What the New H-1B Executive Order Actually Does

The order, titled "Enhancing Program Integrity and Interagency Coordination in the Administration of the H-1B Nonimmigrant Visa Program," directs the Departments of State, Labor, and Homeland Security to coordinate more closely with each other, and to consult with the Departments of Commerce and Education and the Small Business Administration, when processing H-1B petitions, labor condition applications, and visas. These agencies are directed to share wage data, workforce information, and industry data with one another.

The most significant practical change is this: agencies adjudicating H-1B matters must now consider whether a sponsoring employer has directly or indirectly engaged in layoffs within the past year, or plans layoffs in the near future, that affect U.S. workers in positions comparable to the one the H-1B worker would fill. An employer with a recent reduction in force, in other words, may face additional scrutiny on its next H-1B filing.

The order also directs the Department of Labor's Wage and Hour Division to conduct a retrospective review of previously submitted labor condition applications by October 18, 2026, to determine whether enforcement action is warranted under INA § 212(n)(2)(G), the provision that allows the government to investigate and penalize employers for LCA violations.

It is important to understand what this order does not do. It does not, by itself, rewrite the H-1B regulations or create a new legal standard that USCIS officers must apply today. Instead, it directs the relevant agencies to develop implementing regulations, policy memoranda, and operational guidance over the coming weeks and months. Exactly how "layoff activity" will be defined, measured, and weighed against other factors in a given case has not yet been spelled out.

Does This Change Whether My H-1B Petition Will Be Approved?

Not automatically, and not yet in any formal sense. But employers and workers should expect the practical effects to show up gradually as agencies begin implementing the order: more requests for evidence, longer processing times, and closer review of petitions filed by companies that have had recent workforce reductions.

For H-1B workers, the concern is less about a sudden denial and more about delay and added documentation demands, particularly if your employer has had visible layoffs in the past year. For employers, the order is a signal to keep clear, well-organized records showing that any reduction in force was unrelated to a decision to hire or retain H-1B workers, and that recruitment and retention of U.S. workers in comparable roles followed ordinary business practice.

What About the $100,000 H-1B Fee?

The same set of executive actions also extended, through September 21, 2027, a separate $100,000 supplemental fee requirement that applies to certain H-1B petitions for workers who are outside the United States at the time of filing. It is easy to conflate this fee with the new layoff-scrutiny provisions, but they are different policies bundled into the same news cycle.

As of this writing, that fee remains blocked by ongoing federal court litigation and is not being collected. Employers should not assume the fee is currently in effect, but should also not assume it will stay blocked indefinitely. This is an area where the legal landscape could shift quickly, and employers planning H-1B filings for workers abroad should get current advice before assuming either outcome.

What Employers and H-1B Workers Should Do Now

For employers, the most useful step right now is documentation, not panic. If your company has had layoffs in the past year, be prepared to explain, in concrete and well-documented terms, why those layoffs are unrelated to your H-1B hiring, and how positions were selected for elimination. If you are planning layoffs and also have pending or upcoming H-1B filings, the timing and framing of both matters more than it did a month ago.

For H-1B workers, especially those whose employers have had recent workforce reductions, this is a good time to ask your employer's immigration counsel what the company is doing to prepare, and to build in extra time before visa stamping travel, extension filings, or change of employer petitions, since processing may slow down as agencies adjust to the new coordination requirements.

Frequently Asked Questions

Does the executive order stop employers from filing new H-1B petitions? No. Employers can still file H-1B petitions and labor condition applications as before. The order adds a new factor, an employer's layoff history, that agencies are now directed to weigh, but it does not suspend or halt the filing process itself.

Will my currently pending H-1B petition be affected? It's possible, particularly if your employer has had recent, visible layoffs, but the order does not retroactively change the standard your petition is judged against. Expect implementation to roll out gradually as agencies issue guidance.

Is the $100,000 H-1B fee actually being charged right now? No. It remains blocked by federal court litigation as of this writing, even though the order extended the timeframe during which it would apply if the litigation is ultimately resolved in the government's favor.

What exactly counts as a "layoff" that could trigger scrutiny under the order? The order does not yet define this precisely. It refers broadly to direct or indirect layoffs affecting workers in positions comparable to the sponsored role, but the details of how this will be measured are expected to come through future agency guidance.

When will we know how this is actually going to be implemented? Not yet. The Department of Labor's review of past labor condition applications, due by October 18, 2026, is one early marker to watch, but broader implementing guidance from USCIS and the State Department is still to come.

This post is general information about a recent policy development and is not legal advice about your specific situation. If you have questions about how this executive order might affect an H-1B petition, a labor condition application, or your company's hiring plans, contact KA Immigration Law to talk through your circumstances.