Several recent enforcement actions by the U.S. Department of Justice (DOJ) and the U.S. Department of Labor (DOL) show they are aggressively targeting the technology sector’s permanent labor certification (“PERM”) recruitment practices. In just the past year, the DOJ’s Civil Rights Division, Immigrant and Employee Rights Section (IER) has brought or resolved enforcement actions against multiple prominent tech employers, and DOL announced in early October 2026 the suspension of PERM processing for eight major technology companies. These actions send an unambiguous signal: the current administration prioritizes protecting U.S. workers, and both DOJ and DOL are scrutinizing whether tech employers’ PERM processes operate as genuine labor market tests.
A PERM certification issued by the DOL allows an employer to hire a foreign worker to work permanently in the United States. Employers typically file PERM applications for current employees holding temporary visas, most commonly an H-1B (Specialty Occupation) visa.
The PERM recruitment process is a labor market test required to show that no minimally qualified U.S. workers are available to accept the job opportunity before an employer can sponsor a foreign national for the position to work permanently in the United States. The process is designed to protect U.S. workers, that is, individuals who have indefinite work authorization not tied to a specific employer; this includes U.S. citizens, non-citizen nationals, all lawful permanent residents, and those granted refugee or asylum status. 20 C.F.R. § 656.3. DOL will approve an employer’s PERM application only if DOL determines that there are no minimally qualified and available U.S. workers for the offered position. Employers cannot sponsor a foreign worker if a qualified U.S. worker is available. DOL has made clear that employers conducting PERM recruitment must engage in a good-faith search resembling the employer’s normal recruiting process for non-PERM positions.
The Immigration and Nationality Act (INA) prohibits employment discrimination because of a worker’s citizenship status or national origin in hiring, firing, or referral or recruitment for a fee. 8 U.S.C. § 1324b. Under §§ 1324b(a)(1) and (a)(3), U.S. citizens and non-U.S. citizens whose work authorization does not expire are protected from such discrimination; under the statute, these individuals are referred to as “protected individuals.” The exceptions to the prohibition are narrow: for example, employers may take citizenship or immigration status into account where required by law, regulation, executive order, or government contract. See 8 U.S.C. § 1324b(a)(2)(C).
Compliance risks arise when a company’s PERM recruitment process, intentionally or unintentionally, appears to favor foreign workers or discourage U.S. workers from applying.
Across recent enforcement actions, a common fact pattern has emerged: companies maintain separate, more burdensome application channels for PERM-related positions, whether through separate submission requirements or failure to post PERM roles on the employer’s standard career page. Even if unintentional, this can be treated by DOJ and DOL as evidence of citizenship status discrimination. Therefore, the use of separate recruiting tracks should serve as a red flag for any employer engaged in PERM sponsorship.
DOJ is not the only federal agency enforcing these rules. On October 8, 2026, at a White House Fraud Task Force event, Secretary of Labor Keith Sonderling announced that the DOL was suspending new and pending PERM applications filed by eight major technology and IT services companies. The DOL stated it would not accept new PERM applications from any of the eight companies and would not continue processing their applications already pending, citing active federal investigations into alleged fraud, willful misrepresentation, and misuse of employment-based immigration programs. These PERM suspensions can be disruptive for companies, both internally with their workplace, and externally with customers, investors, and directors.
In addition to these enforcement actions, DOL is in the process of finalizing new PERM regulations that are expected to further tighten recruitment requirements and compliance obligations. The first change was noticed in March 2026 and updates the prevailing wage process by increasing the salaries that have to be offered for PERM positions. This change is likely intended to attract greater interest from U.S. workers for these positions.
The second proposed rule was noticed more recently in July 2026 but has not yet been published for public comment. From the abstract, the amendments would “modernize” the PERM application process. Employers should anticipate that any new PERM rulemaking will codify the enforcement expectations already being applied in practice, including requirements that PERM recruitment mirror the employer’s standard hiring processes.
The consequences of noncompliance are substantial and escalating. The statutory penalties for violating 8 U.S.C. § 1324b vary depending on the nature of a violation and whether it is a defendant’s first offense. For example, 8 U.S.C. § 1324b(g)(2)(B) requires first-time defendants to pay a civil penalty of $250–$2,000 for each individual discriminated against. These figures are then adjusted for inflation, more than doubling companies’ exposure under current calculations. As a result, for companies with large job applicant pools, statutory penalties can add up quickly.
In addition to statutory damages, defendants may also be required to pay up to two years of backpay to individuals allegedly discriminated against. This could include individuals who applied to PERM positions but who were not adequately considered, or even broadly, to those who were deterred from applying in one way or another. Given the high compensation packages available in the tech industry, the obligation to pay backpay can add a significant financial cost to any settlement.
Under the current Administration’s Protecting U.S. Workers Initiative, DOJ has increased enforcement actions, with 15 settlements in the last year alone involving alleged citizenship status discrimination in hiring and recruitment under 8 U.S.C. § 1324b. Since the original launch of the Initiative during President Trump’s first administration, DOJ has secured over $34 million in back pay for U.S. workers and obtained over $16 million in civil penalties from employers. The Equal Employment Opportunity Commission and the Department of Labor have also increased enforcement efforts, often collaborating with DOJ under their own regulatory frameworks. In addition to financial loss, these settlements can also result in reputational harm, compliance monitoring, PERM suspensions, training mandates, revised recruitment protocols, and anxiety for a company’s employees, customers, and investors—all of which underscore the urgency of proactive compliance.
MoFo regularly represents technology companies and other employers facing DOJ and DOL scrutiny of their H-1B and PERM practices and recently successfully negotiated a first-of-kind joint settlement with the DOJ and DOL. Our team is available to conduct privileged audits of clients’ PERM recruitment workflows, review and strengthen internal policies to ensure alignment with 8 U.S.C. § 1324b and DOL regulations, and defend employers in IER investigations and enforcement proceedings. Given the pace of enforcement activity and the anticipated regulatory changes, employers sponsoring workers through the H-1B and PERM processes should review their current practices without delay. For more information, please contact Adam Braverman, ABraverman@mofo.com, Leif Dautch, LDautch@mofo.com, or Eric Akira Tate, ETate@mofo.com.