An Executive orderA directive from the President to federal agencies and officials about how to run the executive branch and carry out the law. Executive orders are numbered and published in the Federal Register, and they generally bind the executive branch.See it in the glossary signed September 18 directs the State, Labor and Homeland Security departments to weigh an employer’s layoffs when they handle Cap-subject and cap-exempt (H-1B)The H-1B category has an annual limit of 65,000 new visas or statuses per fiscal year, plus 20,000 more for people with a U.S. master's degree or higher. Petitions counted toward that limit are cap-subject. Petitions from higher education institutions, their related or affiliated nonprofits, and nonprofit or governmental research organizations are cap-exempt.See it in the glossary filings. Executive Order 14431 covers Labor Condition Application (LCA)A Department of Labor form, ETA-9035, that an employer files before petitioning for an H-1B, H-1B1 or E-3 worker. In it the employer attests to standards on wages, working conditions, labor disputes and notice to workers. A certified LCA is then used to support the petition filed with USCIS.See it in the glossary, petitions, visas and entry. It also orders the Labor Department to begin reviewing past applications within 30 days, which falls on October 18.
What the H-1B layoffs order requires
Section 3 tells the three departments to take into account whether an employer sponsor “directly or indirectly” laid off workers within the previous year, or plans future layoffs, that negatively affect similarly situated U.S. workers. The order applies that factor to each stage: the labor condition application, the petition, the visa and the entry of H-1B workers.
Section 2 adds a coordination step. State, Labor and Homeland Security must consult the Commerce and Education secretaries and the Small Business Administration, which are to supply wage, employment, academic and other economic information.
The Labor Department’s 30-day review
Within 30 days of the order, the Labor Department’s Wage and Hour Division must begin reviewing data on previously submitted labor condition applications. The goal is to decide whether further action against sponsoring employers is warranted under the existing enforcement provision of the Immigration and Nationality Act.
The order also delegates to the four cabinet-level departments the President’s authority under section 215(a) of that law, to the extent needed to carry it out. That includes issuing rules, policies or operational guidance.
What the order says about why
The order’s findings say the H-1B program has been “widely abused” by some employers, third-party placement groups and outsourcing firms. It cites estimates of a wage gap between H-1B workers and comparable U.S.-born workers of $9,000 to $20,000 in H-1B-reliant industries, and says technology employers laid off 800,000 to 1.3 million U.S. employees from 2022 through 2026. These figures come from the order and the White House fact sheet. We have not independently verified them.
What the order does not do
The order does not say a layoff blocks an H-1B petition or sets a threshold for how many layoffs matter. It leaves terms such as “similarly situated” and “negatively affect” undefined and does not say how the departments will weigh the factor. Section 4 says it is to be carried out consistent with applicable law and creates no rights enforceable against the government.
Further detail would come from agency guidance or rules, and none had been issued as of October 2. The order was published in the Federal RegisterThe daily journal of the U.S. government where proposed and final rules, notices and executive orders are published.See it in the glossary on September 23.
How this fits with other H-1B actions
The order came the same day the administration extended the $100,000 H-1B entry payment, which courts are also reviewing in a second ruling against the fee. For the existing rules on workers who lose jobs, see what happens after a layoff on a work visa, and for the sponsorship steps employers follow, see our H-1B sponsorship guide.