The Implications of the Public Charge Policy for Companies Employing Foreign Nationals Who Are Experiencing Reductions in Force
On July 20, 2026, the U.S. Department of Homeland Security (DHS) announced that it is rescinding the current DHS public charge rule, which has been in effect for adjustment of status applications since 2022. The reversion of the policy guidance is expected to lower the threshold for determining whether an applicant is likely to become a public charge.
“Public charge” is an immigration rule generally used to determine whether an individual will be unable to financially support themselves in the future. While it primarily applies to certain immigrants applying for a green card, it can also apply to those changing, extending, or re-entering under certain immigration statuses. The change raises concerns for employers sponsoring well-compensated individuals for adjustment of status to U.S. lawful permanent residence (or self-sponsored employees) who may be subject to the public charge rule after periods of unemployment from a company reduction-in-force (RIF).
The current rule took effect in 2022 and guides admissibility determinations for cases decided by U.S. Citizenship and Immigration Services (USCIS). The government is withdrawing the current rule, leaving us with the statute (Immigration and Nationality Act) and whatever policy guidance the government may later release on public charge.
Timing of the Change in Public Charge
The final rule applies to applications for adjustment postmarked or electronically submitted on or after September 18, 2026. The announcement also states that it will apply to benefits used after that date. The guidance has been published in the USCIS Policy Manual and instructs adjudicators on applying the public charge ground of inadmissibility. Under this guidance, adjudicators will have broader discretion to determine if an applicant is likely to become a public charge.
Adjudicators will make individualized, fact-specific public charge inadmissibility determinations based on the totality of the circumstances, including the five statutory minimum factors: age, health, family status, financial status, and education/skills. In addition to the preceding factors relevant to the case, officers will assess empirical data relevant to the applicant’s ability to remain financially self-sufficient.
Thus, officers will have broader discretion to examine the public benefits an applicant has received, the duration and extent of that assistance, and the circumstances surrounding its use. A more discretionary inquiry emerges that looks beyond the existence of a job offer and asks a broader question: “Is this individual likely at any time to become a public charge?”
This creates an inherent tension that every employer sponsoring a noncitizen worker for permanent residence should address. Many industries, especially technology, have experienced repeated workforce reductions over the past several years. Layoffs, combined with the public charge policy, may leave a company’s foreign employees more vulnerable. An employee on a work visa who experiences an interruption in employment may find USCIS broadly applying the public charge policy, potentially determining that the employee is at greater risk of becoming a public charge and denying their green card application.
Employment law concerns
Layoffs affect U.S. citizens, lawful permanent residents (LPRs), and visa holders. Layoffs (and hiring) are driven by business conditions, and employers often make such decisions regardless of immigration considerations for foreign national employees.
Those consequences do not alter the fundamental employment-law principles that govern a RIF. Employers should identify the legitimate business reasons for the reduction, whether it be restructuring, declining demand, technological change, cost savings, or shifting strategic priorities, and let those objectives determine which positions are affected.
Objective selection criteria, applied consistently and well documented, help demonstrate that decisions are based on legitimate business needs rather than protected characteristics. Because visa sponsorship often correlates with national origin, employers should not use it as a selection criterion, either to shield a sponsored employee from layoff due to potential immigration consequences or to target an employee for termination.
Employers should also determine early whether federal WARN Act or state “mini-WARN” notice requirements apply, as those obligations may affect the timing of the reduction. When foreign national employees are affected, employers should clearly set termination dates and coordinate the employment and immigration aspects of the separation.
Severance arrangements may trigger additional requirements. In group termination programs involving employees age 40 or older, releases of federal age discrimination claims must comply with the Older Workers Benefit Protection Act (OWBPA), including its disclosure and consideration-period requirements. This further underscores the importance of establishing and documenting defensible selection criteria before implementing the reduction.
The developing public-charge framework introduces another consideration for RIF planning, but it does not alter these fundamental employment-law principles. Employers can plan for potential immigration consequences while continuing to base RIF selection decisions on legitimate, consistently applied business criteria.
Conclusion
Under the “new” public charge policy, USCIS will have greater discretion to assess an employee’s long-term employment prospects when adjudicating permanent residence applications.
Employers will need to consider how they handle RIFs in light of the employment law considerations described above, while managing layoffs that affect their foreign national workers who may be in the process of adjusting their status to lawful permanent residence in the United States.
In the face of recurring layoffs in many industries, employers may determine that the strongest employment-based adjustment filings will show more than eligibility for the position. They will show, if supportable, earning capacity, employability, and financial resilience. Employers may want to review pending adjustment cases with their legal counsel and identify where additional evidence could help tell that story.
Final note: While the rescission and guidance went into effect on September 18, 2026, the changes are not retroactive. The new policy only applies to adjustment of status (I-485) applications postmarked or e-filed on or after September 18, 2026. Additionally, various cities, states, and organizations have sued challenging the new rule. Although now in effect, it is possible that the new policy may be paused or halted by the ongoing litigation.
