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On September 8, 2026, Department of Labor Inspector General Anthony D'Esposito announced on X that his office had suspended new PERM labor-certification filings for two technology employers, Cognizant and Cloudera. It's one of the first concrete enforcement steps out of the nationwide H-1B and PERM fraud investigation DOL OIG launched July 8, 2026, and no criminal charges had been filed as of the September Mayer Brown alert tracking the enforcement wave.
Update, October 8, 2026. Labor Secretary Keith Sonderling widened the suspension to eight companies (Cognizant, Infosys, Tata Consultancy Services, Wipro, HCL Technologies, Capgemini, Microsoft, and Adobe), and it now covers pending PERM applications as well as new ones. Our October PERM suspension guide covers what changed and why H-1B workers near the six-year limit are the first to feel it. The I-9 guidance below hasn't changed.
A DOL PERM freeze doesn't change anyone's Form I-9 today, and it doesn't make a current H-1B worker unauthorized. Immigration counsel is still getting the question, partly because ICE Notices of Inspection go after I-9 records and not a sponsor's PERM file, and partly because the company that sponsors an H-1B workforce and the client company that uses those workers on site have different obligations under 8 CFR § 274a. They're two separate employers for I-9 purposes, and neither one has to touch a Form I-9 because of the freeze. This is the third piece in a September series on DHS and DOL activity affecting the same workers, alongside our coverage of the proposed elimination of the 60-day grace period and the proposed $103,265 H-1B cap-subject fee.
The July 8 announcement described "widespread schemes" involving fraudulent applications, wage kickbacks, and benching, and asked workers and other insiders to report what they know to DOL OIG, with the White House Task Force to Eliminate Fraud taking part. The PERM suspensions came two months of subpoenas later, on September 8. DOL is relying on 20 CFR § 656.31, which allows PERM applications to be held "until completion of any investigation." No DOL press release followed, and the Inspector General's post is the only public disclosure of the freeze.
Several outlets described the action as "visa filings" being suspended or "H-1B processing" being halted, which isn't what the record shows. PERM is the DOL labor-certification step that comes before an employer-sponsored green-card petition, and the freeze covers new PERM applications filed by the two named employers. Existing H-1B status is untouched, already approved or previously filed PERM cases aren't automatically canceled, and extensions and amendments filed with USCIS move on their own USCIS timeline.
| Field | Detail |
|---|---|
| Action | Administrative hold on new PERM labor-certification filings |
| Announced | September 8, 2026, by DOL OIG Inspector General Anthony D'Esposito on X |
| Authority cited | 20 CFR § 656.31 (PERM filings may be suspended until an investigation completes) |
| Underlying investigation | DOL OIG nationwide H-1B and PERM fraud probe launched July 8, 2026 |
| Employers named | Cognizant (IT services) and Cloudera (data software) |
| Not affected | Current H-1B status. Already-filed or approved PERM cases. H-1B extensions and amendments. Any employer's Form I-9 or E-Verify obligations. |
| Formal charges | None as of the September 2026 Mayer Brown alert |
| Duration | Not published |
That's the whole event, and every I-9 question after it comes from the fact that the workers involved also sit on somebody's payroll, which is where the Form I-9 lives.
The confusion is almost always about who owns which file. A large IT-services vendor like Cognizant sponsors its own H-1B workforce and runs its own I-9s, E-Verify cases, and reverification calendar, and its client companies don't complete I-9s for those workers. M-274 §2.0 is direct about it, saying you don't complete a Form I-9 for someone "employed by a contractor providing contract services (such as employee leasing or temporary agencies) and are providing labor to you."
The sentence right after that exemption is the one client-company counsel keeps in mind, which says "You may not use a contract, subcontract, or exchange to obtain the labor or services of an employee you know is unauthorized to work," and INA §274A(a)(4) puts the same rule into the statute. A public investigation of a vendor doesn't give you that knowledge, and neither does a frozen PERM queue. Knowledge of unauthorized status means knowing a specific worker's specific status, and the good-faith I-9 defense at M-274 FAQ 14 Q3 turns on whether the government can prove you had it.
| Role | Completes the Form I-9? | What the freeze does to that file |
|---|---|---|
| H-1B and PERM sponsor (the vendor) | Yes, for its own employees | Nothing changes today. The clock is still the expiration date recorded in Section 1 and Section 2. Supplement B runs when that date hits. |
| Client company using vendor contractors on site | No | Nothing changes, unless the client acquires actual knowledge that a specific worker is unauthorized. A PERM freeze is not that knowledge. |
| Client that hires the worker directly onto its own payroll | Yes | Treat it the way you treat any H-1B hire. Run the expiration date, reverify on Supplement B, do not reopen E-Verify at reverification. |
The freeze isn't one of the triggers that move Section 2 or require Supplement B, and that list hasn't changed. Reverification runs off the expiration date the employee wrote in Section 1 and, where it applies, the List A document date recorded in Section 2. It's never required when a U.S. passport, U.S. passport card, Permanent Resident Card, or List B document expires, and never for U.S. citizens or noncitizen nationals. Our reverification facts piece walks through everything else in detail.
Two mechanics keep sponsors out of trouble when a specific H-1B worker's approval is running down. The first is the 240-day rule at 8 CFR § 274a.12(b)(20), under which an extension of stay filed with USCIS before the current period expires carries continued work authorization for up to 240 days while the petition is pending. That rule lives with USCIS on the H-1B side, so a PERM freeze at DOL doesn't touch it. The second is Supplement B itself, which you fill in when the recorded expiration date hits, using whatever List A or List C document the employee chooses.
Two moves don't help anyone. E-Verify isn't a reverification tool, and rerunning cases on existing workers because their vendor is under investigation creates a discrimination record without answering any compliance question. A client company that completes "backup" I-9s on vendor contractors also builds a paper trail suggesting it treated those workers as its own employees, and that binder tends to end up as the government's exhibit.
The freeze doesn't end anyone's employment, though a separate wave of changes might. A client company that drops the vendor contract, or a vendor that rebalances an engagement and lays workers off, moves the I-9 conversation from reverification to offboarding. Today's rule at 8 CFR 214.1(l)(2) still gives most employment-based nonimmigrants (E, H-1B, H-1B1, L-1, O-1, TN, and their dependents) up to 60 days after their job ends to be picked up by a new sponsor or leave. The DHS Notice of Proposed Rulemaking published September 11 would eliminate that bridge, with comments closing November 10, 2026. Nothing changes until DHS publishes a final rule with an effective date, but the planning calendar has already moved.
For the sponsor, the practical takeaway is that the reverification calendar and the offboarding calendar need to be read together now. A worker whose H-1B job ends because the project ended is in a different spot from a worker whose H-1B runs out on the I-94 date. The first gets up to 60 days under 8 CFR 214.1(l)(2), the second gets the 10 days after the validity period under 214.1(l)(1), and neither can work during that time unless something else authorizes it. The proposal goes after the 60-day bridge.
Constructive knowledge at 8 CFR § 274a.1(l) trips employers up in two opposite directions after a public enforcement action against a sponsor. The first is overreading, where a DOL investigation into a sponsor's PERM recruitment gets treated as constructive knowledge that specific contracted workers are unauthorized, and then used to justify pulling contractors off site or demanding new documents from the vendor. The regulation's own examples are about facts tied to a particular worker, like an I-9 the employer failed to complete properly or information in hand showing that person isn't authorized to work. An investigation into a company's PERM recruitment process isn't information about any one worker's employment authorization.
The second is overcorrecting, like running a "special audit" of workers by national origin or singling out the vendor's badges for a new document request, both of which run into the anti-discrimination rules enforced by DOJ's Immigrant and Employee Rights Section (IER). The employee still chooses which List A document or List B and C combination to present, and the employer still can't demand a specific document. National origin, citizenship status, and immigration status all sit inside the same prohibition at INA §274B, and a public investigation of an employer doesn't lift any of it.
The last piece of confusion is about jurisdiction, because DOL OIG isn't ICE. A DOL subpoena for PERM recruitment records is part of a labor-certification investigation, while an ICE Notice of Inspection is an I-9 audit run by a different agency under a different statute against a different file. Both can happen at the same employer in the same year, and neither one previews the other.
The playbook for an NOI is the one we've already published. Lock down the I-9 files, call counsel, and produce the I-9s within the three-business-day window (or whatever extension counsel negotiates), organized to match what the NOI asks for. Don't backdate a correction, white out an old entry, or refile a form that was never signed on time. The line between substantive and technical violations moved in March 2026, and paperwork corrections that used to be safe now show up in the findings letter. Paperwork violations currently run $288 to $2,861 per Form I-9, and knowing hires run $716 to $28,619 per worker, under the January 2025 Federal Register adjustments (see I-9 Penalties 2026).
The audit-ready answer to the vendor question is a list of names and dates. Our compliance team can pull the H-1B, H-4 EAD, and other expiring List A populations out of your I-9 book, sort them by classification and upcoming reverification date, and show you which ones are your obligation and which belong to your vendor. Schedule a free compliance call, or request an I-9 audit if the book has grown through acquisitions or an HRIS switch.
The freeze is a DOL enforcement story, and the most useful thing counsel can do is keep the client from building an I-9 story on top of it.
"The employer-of-record split does the work. If those workers were never your employees, their I-9s were never your records to keep. What we pull for the client is the H-1B and H-4 EAD populations they actually hired, sorted by the reverification date the I-9 already carries. That list existed before any enforcement action. An enforcement action against a sponsor is a reason to open it," says Patricia Duarte, Director of Compliance at i9 Intelligence.
No. The freeze holds new PERM labor certifications at DOL, and PERM is the recruitment-based step that comes before an employment-based green-card petition. It doesn't revoke H-1B status, cancel a filed or approved PERM case, or affect any I-9 or E-Verify obligation.
No. M-274 §2.0 says you don't complete Form I-9 for employees of a contractor providing contract services or labor to you, because the vendor completes those. Creating "backup" I-9s on vendor contractors suggests you treated them as your employees, which is the opposite of the argument you want on file.
Only if you know a specific worker is unauthorized and keep using that labor through the contract. INA §274A(a)(4) treats that as a hire in violation of §274A(a)(1)(A), and a public investigation of the vendor isn't the same as knowledge about any specific worker.
No. E-Verify runs at hire, and for federal contractors covered by FAR clause 52.222-54 it can also cover some existing employees. It isn't a reverification tool or a legally supported response to a DOL OIG action, and rerunning cases on selected workers because a vendor made the news creates a discrimination record.
PERM is the green-card step, and the H-1B extension is a separate USCIS filing. A timely-filed H-1B extension still carries continued work authorization for up to 240 days while it's pending under 8 CFR § 274a.12(b)(20), and you reverify on Supplement B based on the expiration date recorded on the I-9.
Produce your own I-9s within three business days, in the form the NOI asks for, and don't edit any record before it goes out. A DOL OIG investigation into a vendor's PERM filings is a separate case at a separate agency. Our ICE audit walkthrough covers the production and findings-letter steps in detail.
Reach the i9 Intelligence compliance team Monday through Friday, 8am to 5pm CT.