H-1B Immigration Crackdown: Unprepared Companies At Risk

DOL H-1B Visa Investigations have entered an unprecedented phase, signaling a dramatic reset in how the United States handles high-skilled immigration oversight. The Department of Labor (DOL) has launched up to 200 active investigations targeting H-1B employers, marking the most aggressive enforcement push in decades and reasserting its statutory authority after years in which U.S. Citizenship and Immigration Services (USCIS) took the lead.

Announced through Operation Firewall, the crackdown is designed to ensure compliance with federal wage rules and push back against what officials describe as “growing vulnerabilities” in the H-1B program. For companies heavily dependent on global talent—especially in artificial intelligence—this renewed scrutiny represents both a legal wake-up call and a seismic shift in oversight politics.

A New Power Center in H-1B Enforcement

The DOL initiative represents more than just a surge in audits. It’s a structural rebalancing of federal power.

Attorneys say that by aggressively reasserting its investigative prerogative, the Labor Department is effectively reclaiming a role that had been overshadowed by USCIS actions many experts considered beyond its statutory boundaries. For the first time in over 25 years, even the Secretary of Labor has personally certified investigations, a rarely used but potent legal authority.

While USCIS manages H-1B adjudications, DOL controls wage enforcement and workplace compliance. And those wage rules are at the center of the latest enforcement drive.

Why This Crackdown Matters

H-1B visas are the primary gateway for high-skilled global talent to work long-term in the United States. Employers must pay the higher of the actual or prevailing wage, a requirement designed to prevent undercutting U.S. workers.

But this year the stakes are particularly high. Top tech companies—including Amazon, Meta, Microsoft, Google, and Apple—continue to dominate H-1B hiring as they race to build America’s AI infrastructure. According to NFAP data, these firms topped the charts for new petitions in FY 2025, while Indian IT giants—once major users of the program—have nearly disappeared from the rankings.

With global competition for AI talent intensifying, the limited H-1B cap of 65,000 regular visas and 20,000 master’s exemptions covers barely 0.05% of the U.S. labor force.

That mismatch between demand and availability is shaping corporate hiring—and federal enforcement.

H-1B: Operation Firewall – The DOL’s Largest Modern Crackdown

Launched in September, Operation Firewall is the Labor Department’s most visible enforcement drive since the H-1B program was created.

Described as an effort to “safeguard the rights and wages of U.S. workers,” the initiative has triggered:

• 175 to 200 active investigations

• New audits targeting wage violations

• Expanded scrutiny of H-1B placement at customer sites

• A forthcoming rule to raise prevailing wages

Bloomberg Law places the investigation count at 200, while Fox Digital News reports 175—either way, analysts say the scale is unprecedented.

How Companies Get Caught: The Hidden Triggers

Most violations aren’t rooted in intentional fraud—they stem from misunderstanding complex rules, according to immigration attorneys.

1. Deducting Licensing or Training Fees

A deduction that is legal for U.S. workers can become illegal for H-1B employees if it pushes pay below the wage listed on the Labor Condition Application (LCA).

2. Counting Bonuses as Base Wages

Because non-guaranteed bonuses can’t be used to meet the required wage, H-1B salaries structured like American compensation packages often fall short.

3. “Benching” Workers Without Pay

U.S. employees can go unpaid when there is no work.
H-1B workers must be paid—even during unproductive time.

4. Improper Terminations

A legal H-1B termination requires three steps:

1. Fire the employee

2. Notify USCIS

3. Offer return transportation

Miss one, and back wages may be owed.

The Return of DOL Authority Shapes Legal Strategy

The crackdown is directly tied to the administration’s move to impose a $100,000 visa fee on employers—an action widely criticized as punitive. On the same day that fee was announced, DOL launched Operation Firewall, signaling a coordinated policy effort.

In Global Nurse Force v. Trump, plaintiffs argued that DOL data contradict claims of widespread H-1B abuse—only eight companies have been banned from the program in recent years, despite tens of thousands of employers using it annually.

Legal scholars say this mismatch is now driving more targeted enforcement instead of broad rhetoric.

The “Entry-Level Salary” Myth Returns

Critics frequently label H-1B holders as “ordinary workers” because many are paid Level I or Level II wages. But immigration attorneys argue the wage levels reflect labor-market experience, not talent.

A newly minted PhD in machine learning may be “Level I” in wage terms—yet in reality, among the most coveted professionals in the world.

Like rookie athletes earning “entry-level” salaries, workers often deliver far more value than their wage classification suggests.

Notably, 63% of H-1B workers hold a master’s degree or higher, according to USCIS data, and the average salary in computer fields already exceeds $136,000.

H-1B: AI Investments and Visa Oversight Collide

America’s biggest tech companies are betting billions on artificial intelligence, and international students—who represent 70% of full-time graduate enrollments in AI-aligned fields—remain central to that ecosystem.

Yet the DHS proposal to restructure the lottery in favor of higher salaries may reduce opportunities for recent graduates, a move experts warn could undermine the U.S. talent pipeline.

No competing nation prioritizes older managers over emerging researchers—except the new U.S. proposal.