Overview
A recent enforcement action led by Texas Attorney General Ken Paxton targeting multiple Texas-based companies signals a meaningful shift in how H-1B compliance risk is evolving in 2026.
While federal agencies have historically driven oversight of the H-1B program, this development introduces an additional layer of scrutiny at the state level. For employers, particularly those operating in high-growth or distributed workforce environments, this expands both the scope and complexity of compliance risk.
The investigation centers on allegations that certain companies misrepresented business operations and employee worksites, including the use of so-called “ghost offices” to support H-1B petitions. Authorities have requested extensive documentation, including employee records, operational details, financials, and internal communications.
For HR and global mobility leaders, the significance lies less in the individual companies involved and more in what this signals: a broader enforcement posture that directly intersects with workforce strategy, vendor management, and operational oversight.
Why This Matters for Your Business
1. Compliance Risk Is No Longer Limited to Federal Oversight
The expansion of enforcement activity beyond federal agencies introduces a more fragmented and potentially more aggressive compliance landscape. Employers should anticipate:
- Increased audit activity
- Greater documentation scrutiny
- Parallel inquiries across jurisdictions
2. Workforce Strategy Is Now Tied to Immigration Risk
H-1B employees are often embedded in critical functions. Any disruption tied to compliance issues can impact:
- Product delivery timelines
- Client commitments
- Talent retention strategies
Impacts on business functions have already been felt by employers affected by global consular processing delays.
3. Third-Party Relationships Are a Growing Exposure Point
Organizations leveraging IT consulting firms or staffing vendors may inherit risk if those partners are not maintaining compliant practices. In this environment:
- Vendor compliance is effectively an extension of your own
- Lack of visibility into vendor operations can create blind spots
What Are Ghost Offices?
A “ghost office” is described by the Attorney General as “as a scheme in which businesses falsely represent active operations in order to sponsor foreign workers”. The concept of a “ghost office” reflects a broader issue: misalignment between what is filed and how work is actually performed.
For HR leaders, this risk often arises not from intentional misconduct, but from operational drift:
- Remote or hybrid employees working from unreported locations
- Office expansions or consolidations not reflected in filings
- Inconsistent documentation of supervision and reporting structures
- Use of flexible or shared workspaces without proper immigration alignment
As workforce models become more distributed, maintaining this alignment becomes significantly more complex—and more critical.
Immediate Areas for Internal Review
1. Worksite and Role Alignment
- Are all H-1B employee work sites accurately reflected in LCAs and petitions?
- Do job descriptions align with current responsibilities?
- Have remote or hybrid arrangements been formally documented and updated where required?
2. Documentation and Audit Readiness
- Can the organization clearly demonstrate supervision and control for each H-1B employee?
- Are internal records consistent across HR, legal, and operational teams?
3. Vendor and Partner Oversight
- Do third-party vendors provide transparency into their H-1B compliance practices?
- Are contractual safeguards in place to mitigate risk exposure?
- Can vendors produce supporting documentation if audited?
The Strategic Role of Legal Counsel
In the current environment, immigration counsel plays a critical role beyond petition filing.
Forward-looking organizations are leveraging legal partners to:
- Conduct proactive compliance audits aligned with current enforcement trends
- Identify gaps between HR operations and immigration requirements
- Assess third-party relationships for potential exposure
- Develop defensible documentation frameworks across worksites and roles
- Guide response strategies in the event of audits, RFEs, or investigative actions
As enforcement becomes more complex, the ability to anticipate and mitigate risk before it escalates is increasingly tied to how closely HR and legal functions are aligned.
Work With Us
Organizations that treat immigration compliance as part of their broader operational strategy—rather than a transactional requirement—will be better positioned to maintain workforce continuity and avoid disruption as enforcement activity continues to evolve.