This two-part article offers a clear and timely look at the forces reshaping today’s labor market. Part I examines the shifting regulatory expectations that are redefining employers’ compliance obligations, while Part II explores the free-market pressures that continue to drive companies toward global and outsourced talent. Together, these insights provide a comprehensive view of how policy changes and economic realities are transforming hiring strategies across the country.
PART I — The New Domestic Hiring Landscape: Policy Shifts Shaping Employer Obligations
The United States is entering a pivotal moment in how it regulates outsourcing, immigration, and domestic hiring. A series of federal actions, most notably the proposed Halting International Relocation of Employment (HIRE) Act, the EEOC’s initiative to combat anti-American bias, and the new $100,000 H-1B visa fee reflect a strong national push to rebalance the labor market in favor of American workers.
These policies collectively represent one of the most significant shifts in labor and compliance policy in recent years, signaling greater scrutiny of outsourcing and increased protection for U.S. citizens in the workforce.
The HIRE Act: Penalizing Labor Offshoring
Proposed by Senator Bernie Moreno (R-OH), the HIRE Act is designed to reduce outsourcing by making it more expensive for companies to send work abroad. It would:
- Impose a 25% excise tax on payments to foreign entities for services used by U.S. consumers.
- Prohibit companies from deducting this tax, making the financial impact even greater.
- Require outsourcing disclosures, with penalties of 50% of unreported amounts per month.
Revenue from the tax would fund domestic workforce initiatives, signaling an attempt to rebuild American talent pipelines.
EEOC Enforcement: Addressing “Anti-American Bias”
In February 2025, the EEOC launched a new enforcement initiative targeting discrimination against U.S. citizens, an expansion of traditional national origin protections under Title VII. Employers or staffing firms who overly favor foreign workers, intentionally or unintentionally, now risk investigation.
This shift makes it clear that compliance requires neutrality: efforts to diversify workforces cannot exclude equally qualified American candidates.
The $100,000 H-1B Fee: Reassessing Global Hiring
President Trump’s proclamation imposing a $100,000 fee on new and renewal H-1B petitions significantly raises the cost of hiring foreign skilled workers. For industries that rely on global technical talent—technology, engineering, healthcare, and analytics—this shift requires rethinking offshore and international hiring strategies.
A Changing Risk Landscape
These policies create new financial, compliance, and reputational risks:
- Outsourcing may become cost-prohibitive if the HIRE Act passes.
- EEOC’s focus on national origin discrimination could expose well-intended DEI or staffing practices to legal scrutiny.
- Global hiring strategies will now need to account for dramatically higher H-1B costs.
The message is clear: federal expectations are shifting, and employers must adapt accordingly.
Best Practices for Employers
- Review hiring policies for compliance with national origin protections.
- Audit outsourcing contracts for potential HIRE Act exposure.
- Reevaluate DEI initiatives to ensure neutrality toward U.S. workers.
- Train HR and recruiters on EEOC’s updated enforcement priorities.
- Analyze global labor cost models in light of the H-1B fee increases.
- Invest in domestic workforce development through apprenticeships, veterans hiring, and partnerships with U.S. institutions.
At HR Unlimited Inc., we help federal contractors and employers navigate complex compliance requirements while building stronger, more inclusive workplaces. If you’re ready to strengthen your compliance and equity efforts, contact us today to learn how we can support your EEO and non-discrimination goals.