Trump targets H-1B employers laying off Americans. What it means for Indians

US President Donald Trump is tightening the American immigration system on multiple fronts. After extending the USD 1,00,000 fee for H-1B visas by another year despite facing legal challenges, Trump has now signed an executive order that will bring employers laying off American workers under greater scrutiny. The order directs federal agencies to scrutinise H-1B visa applications from companies laying off US workers or those planning to cut jobs that could affect "similarly placed" American employees.

Both the moves stand to indirectly impact Indian technology workers, who dominate the H-1B visa program. The visa allows US employers to hire foreign workers in specialised roles. Around three out of every four approved H-1B visas are cornered by Indian nationals, making them the backbone of America's tech sector and some of Silicon Valley's biggest companies.

However, ever since he assumed office last year, Trump has tightened his crackdown on H-1B visas as part of a drive to create more jobs for American citizens.

Last month, Homeland Security proposed a new rule to do away with the 60-day grace period for H-1B and other non-immigrant visa holders after job loss. This essentially will leave affected workers with far less time to secure another lawful avenue to remain in America.

As per the latest order, the US State Department, Labour Department, and Homeland Security have been directed to coordinate more closely while processing H-1B applications. The agencies will look into whether an employer sponsoring H-1B workers has directly or indirectly carried out layoffs, or is planning job cuts that could affect US workers.

The White House said the order, signed on Saturday, was aimed at curbing the misuse of the H-1B program by companies that use foreign workers to replace American employees or reduce labour costs.

In simple terms, a US-based company that has recently fired American workers will now face greater scrutiny when it seeks to hire foreign workers via the H-1B route.

"Many employers have laid off large numbers of highly skilled American workers, only to promptly hire large numbers of H-1B workers who are often lower-skilled and lower-paid," the executive order said.

It further stated that somewhere between 8,00,000 to 1.3 million American employees have been laid off from 2022 through 2026. "Employers have even forced laid-off American workers to train their foreign replacements," the order said.

It also alleged that some outsourcing companies bring H-1B workers to the US before eventually shifting their work overseas.

However, it must be noted that the order does not dissuade or impose a blanket ban on such companies hiring H-1B workers.

Instead, it directs agencies to amplify scrutiny on layoffs and other employment practices when processing labour applications (LCA), visa petitions and H-1B visas. LCA refers to the Labour Condition Application, which has to be filed by the employer with the Labour Department.

The Labour Department has also been given 30 days to start reviewing previously filed LCAs to determine whether any action was needed against any companies.WHY INDIANS COULD BE AFFECTED?

For many Indian technology workers, the H-1B visa is the entry point into a longer career in the US. As mentioned earlier, Indians make up the largest group of H-1B visa holders.

The impact of Trump's order will depend on how US agencies implement it. The US President has directed the US Secretary of State, the Commerce Secretary, the Labour Secretary, and the Homeland Security Secretary to come out with rules and operational guidance to carry out the order.

Companies that have recently laid off American employees are likely to face additional scrutiny when sponsoring H-1B workers for similar positions.

This could make some employers more cautious about hiring H-1B workers after layoffs. It could also lead to additional checks of wages, employment duties and the qualifications of foreign workers.

Since Indian nationals dominate the H-1B visa program, they are most likely to be impacted.

Reacting to the order, the Foundation for India and Indian Diaspora Studies (FIIDS) said jobs that need highly specialised skills cannot always be filled immediately from the available domestic labour pool.

In a statement, the FIIDS underlined that in areas such as AI and cyber security, employers face "real and highly specific skill gaps" that cannot always be filled from the domestic workforce. "The answer is not to pit American workers against high-skilled immigrants," it said.

Hours after Trump signed the executive order, US Labour Department inspector general Anthony D'Esposito warned businesses whose models depend on "gaming our immigration system" of investigations. "A visa is not a license to cheat American workers," D'Esposito tweeted.- EndsPublished By: Abhishek DePublished On: Sep 19, 2026 13:10 IST