Temporary visa workers over Americans? Why US companies are facing scrutiny over foreign-worker hiring practices

The US Department of Justice is intensifying its scrutiny of companies that prioritize foreign workers over American employees, particularly in the realm of green-card sponsorship. Technology and IT service firms are under increasing focus from the Justice Department's Immigrant and Employee Rights Section (IER) regarding their recruitment practices for PERM (Permanent Employment Authorization) sponsorship.

This enforcement drive follows the Trump administration's heightened emphasis on safeguarding American workers and investigating potential advantages granted to temporary visa holders during the hiring process. A notable recent case involves OpenAI, which has reached a $3.2 million settlement to resolve claims that its recruitment methods placed US workers at a disadvantage in relation to the PERM process.

This settlement is the largest of its kind issued by the DOJ in this specific area since Apple paid $25 million in 2023 to settle similar allegations of discrimination against US citizens in its PERM recruitment process. The Department of Justice's interest in PERM, a critical step for foreign workers seeking employment-based green cards, centers on how employers conduct their recruitment efforts to demonstrate that qualified US workers are not available for the position.

The DOJ's concerns have been directed towards employers' recruitment practices, with a recent investigation revealing that OpenAI and its subsidiary Statsig required external applicants for PERM-related positions to submit their applications by mail, while candidates for other roles could apply via an online system. This disparity in application methods made it more challenging for US workers to compete for the positions.

Similar allegations have been made against Meta Platforms and Apple in the past. Immigration attorneys note that these cases highlight a broader trend in DOJ enforcement, where companies can adhere to Labor Department PERM regulations but still face scrutiny if their recruitment practices are deemed to hinder US workers from applying.

Compliance with Labor Department PERM requirements alone does not serve as a defense in the DOJ's antidiscrimination context. OpenAI is now obligated to submit biannual reports detailing its PERM procedures for the next three years. Assistant Attorney General Harmeet K. Dhillon of the DOJ's Civil Rights Division explained that the settlement ensures OpenAI will modify its recruitment practices to provide a fair chance for US workers.

The DOJ has ramped up both independent and complaint-driven investigations into companies accused of unlawfully favoring temporary visa holders over US workers. The department has reached 13 settlements involving alleged hiring bias over the past 18 months as part of the Trump administration's Protecting US Workers Initiative, according to Bloomberg Law.

Beyond settlements, the DOJ has also initiated an administrative complaint against Cloudera, leading the Labor Department to prohibit the company from submitting new PERM filings—a rare enforcement action. This enforcement campaign has put the recruitment process under close examination, including how job postings are made and how applicants are permitted to submit their applications.

The ongoing regulatory overhaul by the Labor Department aims to address the challenges companies face in effectively recruiting US workers. These changes reflect a growing emphasis on ensuring that job advertisements and application processes reflect contemporary hiring practices. The OpenAI settlement also includes a provision allowing it to be reassessed if a revised Labor Department rule conflicts with its current requirements.

Immigration lawyers believe that the regulatory changes may alter how employers conduct PERM recruitment, but they do not anticipate the DOJ's focus on alleged bias against US workers to diminish anytime soon. Companies sponsoring foreign workers are now being urged to demonstrate that their recruitment process offers a genuine and comparable opportunity for US workers to compete for the same positions, beyond merely meeting PERM's technical requirements.