Insight Major Immigration Developments Affecting U.S. Employers
By Michelle Williams,
Several significant immigration developments have emerged in recent weeks that may affect employers’ hiring practices, workforce planning, immigration sponsorship strategies, and compliance obligations. Most notably, USCIS has issued new guidance regarding adjustment of status applications that could create additional uncertainty for employers sponsoring foreign national employees for permanent residence.
USCIS Issues New Adjustment of Status Memorandum
On May 21, 2026, USCIS issued Policy Memorandum PM-602-0199, entitled “Adjustment of Status is a Matter of Discretion and Administrative Grace, and an Extraordinary Relief.” The memorandum emphasizes that adjustment of status—the process by which eligible foreign nationals obtain lawful permanent residence from within the United States—is a discretionary benefit rather than an entitlement.
The memorandum instructs USCIS officers to undertake a broader discretionary analysis when adjudicating adjustment applications and suggests that consular processing abroad should be viewed as the ordinary pathway to permanent residence, while adjustment of status should be considered an extraordinary form of relief.
This guidance has generated significant concern throughout the immigration law community because Congress created adjustment of status under Section 245 of the Immigration and Nationality Act specifically to provide eligible individuals already present in the United States with a pathway to obtain permanent residence without departing the country. For decades, adjustment of status has served as the primary mechanism through which employment-based immigrants obtain green cards while continuing to live and work in the United States. Many practitioners have expressed concern that the memorandum’s characterization of adjustment of status as an ‘extraordinary’ benefit is inconsistent with decades of agency practice and congressional intent.
Importantly, DHS and USCIS have recently attempted to clarify and soften some of the concerns raised by the memorandum. Following significant criticism from immigration practitioners, employers, and business organizations, agency officials have indicated that the memorandum should not be interpreted as a wholesale attack on individuals who are lawfully present in the United States or those who entered the country through lawful channels. In particular, DHS has suggested that foreign nationals who have maintained lawful status, including employment-based nonimmigrants and business visa holders, should not be viewed as disfavored simply because they seek to adjust status within the United States. While this clarification provides some reassurance, the memorandum still grants adjudicating officers broad discretion and leaves uncertainty regarding how the policy will be applied in practice.
As a result, employers should continue to expect increased scrutiny of employment-based adjustment of status applications while recognizing that the agency appears to be walking back concerns that lawful status holders would be categorically disadvantaged under the new policy. Nevertheless, until formal guidance is issued or adjudication trends become clearer, employers should proceed cautiously and work closely with immigration counsel when developing permanent residence strategies for sponsored employees.
What This Means for Employers
Although the memorandum does not eliminate employment-based adjustment of status applications, employers should expect increased scrutiny of green card cases, including:
- Additional Requests for Evidence (RFEs);
- More extensive review of an employee’s immigration history and maintenance of status;
- Longer adjudication timelines;
- Greater uncertainty regarding case outcomes;
- Potential disruptions if employees are required to pursue immigrant visa processing abroad.
For employers sponsoring workers through PERM labor certifications and employment-based immigrant petitions, workforce planning may become more challenging as employees face increased uncertainty regarding their path to permanent residence.
Recommended Employer Actions
Employers should:
- Review ongoing green card sponsorship cases;
- Encourage foreign national employees to maintain underlying nonimmigrant status whenever possible;
- Ensure employment records and immigration documentation are accurate and consistent;
- Prepare for increased RFEs and discretionary review;
- Consult immigration counsel regarding pending and future adjustment filings.
While the ultimate impact of the memorandum remains uncertain, and legal challenges are anticipated, employers should be prepared for heightened scrutiny of employment-based adjustment of status applications.
ICE Expands Form I-9 Enforcement and Increases Employer Liability
Employers should also be aware of recent changes to ICE’s Form I-9 enforcement policies. Numerous violations previously classified as technical errors have reportedly been reclassified as substantive violations, exposing employers to immediate monetary penalties that may have previously been avoidable through correction procedures.
As a result, employers should expect increased scrutiny of Form I-9 compliance and a greater risk of penalties arising from paperwork deficiencies.
Recommended Employer Actions
- Conduct internal Form I-9 audits and make necessary corrections now;
- Review electronic I-9 systems;
- Train HR personnel responsible for onboarding and verification procedures;
- Address existing compliance concerns proactively.
Increased Worksite Enforcement Activity
Federal agencies continue to prioritize worksite enforcement initiatives, resulting in increased scrutiny of employers’ compliance with immigration and employment laws. Notably, many investigations are being initiated based on anonymous tips submitted by members of the public, underscoring the importance of maintaining thorough compliance practices and internal employment verification procedures. Employers in industries such as construction, manufacturing, agriculture, hospitality, transportation, and food processing should anticipate increased enforcement activity, including:
- Notices of Inspection (NOIs);
- Administrative subpoenas;
- Worksite investigations;
- Employee document audits.
Employers should have a response plan in place before receiving a government inquiry.
Recommended Employer Actions
- Establish an ICE audit response protocol;
- Identify company representatives responsible for interacting with government officers;
- Train managers and HR personnel regarding proper response procedures.
Updated Form I-9 and E-Verify Requirements
USCIS has implemented updates to Form I-9 and corresponding E-Verify procedures. Employers should ensure that they are utilizing the correct version of Form I-9 and that all onboarding systems have been updated accordingly.
Employers should also remember that the alternative procedure permitting remote examination of Form I-9 documents is available only to employers that are enrolled in and actively participating in E-Verify. Employers utilizing the remote document review option must comply with all E-Verify requirements and follow the specific procedures established by DHS and USCIS, including retaining clear copies of the employee’s identity and work authorization documents.
Employers that are not enrolled in E-Verify must continue to physically examine an employee’s Form I-9 documents in the employee’s physical presence or utilize an authorized representative to complete the in-person document review on the employer’s behalf.
As remote hiring continues to become more common, employers should carefully review their onboarding procedures to ensure compliance with these requirements, as improper remote verification practices remain a common source of Form I-9 violations during government audits.
Recommended Employer Actions
- Confirm use of the current Form I-9;
- Verify electronic onboarding systems are compliant;
- Review E-Verify procedures and employee training materials;
- Confirm that any remote Form I-9 verification procedures comply with DHS requirements;
- Consider whether enrollment in E-Verify would benefit the organization’s hiring and onboarding practices.
Increased Scrutiny of Employment Authorization Programs
Federal agencies have also increased scrutiny of various employment authorization programs utilized by foreign national workers.
Employers relying on F-1 students participating in Optional Practical Training (OPT) or STEM OPT programs should ensure that all reporting, supervision, and training obligations are being satisfied. Employers sponsoring H-1B workers should likewise verify compliance with wage obligations, Labor Condition Applications, and worksite requirements.
Recommended Employer Actions
- Review foreign national employee records;
- Confirm compliance with OPT and STEM OPT requirements;
- Audit H-1B public access files and worksite locations;
- Ensure immigration records remain current and accurate.
What Employers Should Do Now
Given the current enforcement environment, immigration compliance should be viewed as a critical business risk management function.
Employers should consider:
- Conducting a privileged Form I-9 audit;
- Reviewing onboarding and employment verification procedures;
- Auditing foreign national employee sponsorship programs;
- Evaluating green card sponsorship strategies;
- Implementing a written ICE audit response plan;
- Training HR personnel and managers regarding immigration compliance obligations.
How We Can Help
Our firm regularly assists employers with Form I-9 compliance audits, E-Verify compliance, worksite enforcement preparedness, employment-based immigration sponsorship, and workforce compliance strategies.
If you have questions regarding your organization’s immigration needs or would like to schedule a proactive compliance review, please contact our office.
This blog is provided by Hawley Troxell Ennis & Hawley LLP for educational and information purposes only. It is intended to notify our clients and friends of certain events or issues. It is not intended to be, nor should it be, used as a substitute for legal advice regarding specific factual circumstances. © Hawley Troxell Ennis & Hawley LLP all rights reserved.
