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Layoff Impact on Pending PERM: What Employers and Employees Should Know

By July 7, 2025PERM
Cardboard box with “FIRED” sign symbolizing employee layoffs affecting PERM labor certification

How Layoffs Affect the PERM Labor Certification Process

The PERM Labor Certification is the first step in many employment-based green card cases, including those in the EB-2 and EB-3 categories. It requires employers to conduct a strict recruitment process to show that no qualified U.S. workers are available for the position being offered to the foreign national. 

But what happens if a company conducts a layoff during the PERM process? The impact of a layoff on a pending PERM application can be significant, especially when the layoff involves U.S. workers in similar roles. 

The Department of Labor’s Layoff Notification Requirement 

Under 20 CFR § 656.17(k), if an employer has conducted layoffs within six months before filing a PERM application, the employer must take additional steps. Specifically, if the layoffs affected workers in the same or related occupations and in the same area of intended employment, the employer must notify and consider those laid-off workers for the job opportunity before filing the PERM application. 

This rule is designed to protect U.S. workers and ensure fair recruitment practices. If this step is skipped or handled incorrectly, the Department of Labor (DOL) may deny the PERM application, regardless of the foreign national’s qualifications or the employer’s intent. 

What Happens If Layoffs Occur After Filing PERM?

If layoffs happen after the PERM application has been filed, the situation becomes more nuanced. The DOL generally evaluates layoffs before or during the recruitment period. However, layoffs that occur while a PERM is pending may still raise compliance questions if they appear to undermine the employer’s need for the foreign worker or suggest that qualified U.S. workers were displaced. 

In such cases, the DOL may audit the application or issue a Notice of Supervised Recruitment, requiring the employer to repeat the recruitment process under strict government oversight. 

Practical Scenarios 

Here are a few examples to illustrate potential outcomes: 

  • Layoffs in a different department or unrelated roles may not affect the PERM if the positions are not similar to the sponsored role. 
  • Remote layoffs may be relevant if the laid-off employees could have reasonably worked in the location where the PERM job is based. 
  • Voluntary terminations or resignations typically do not count as layoffs under PERM regulations. 

Employers must work with legal counsel to analyze how the layoffs align with the job duties, requirements, and location listed in the PERM application. 

Best Practices for Employers Navigating Layoffs

If you are an employer preparing to file a PERM or already have one pending and anticipate layoffs, it is essential to: 

  • Identify whether any layoffs involved similarly employed U.S. workers 
  • Retain documentation of all recruitment steps and layoff communications 
  • Notify and consider potentially affected U.S. workers before filing 
  • Consult with immigration counsel to avoid regulatory missteps 

The consequences of non-compliance include delays, denials, or loss of priority dates—outcomes that can be costly and difficult to reverse. 

Final Thoughts

Whether you’re an employer managing workforce changes or a foreign national concerned about the impact of a layoff on a pending PERM, the immigration attorneys at Scott Legal, P.C. can help. We provide clear guidance on regulatory compliance and help clients navigate audits, layoffs, and recruitment documentation. 

Schedule a consultation today and protect your green card case from unnecessary risks. 

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