OpenAI to Pay $3.2M After DOJ Says It Favored Foreign Visa Holders Over US Workers: 'It Is Illegal'

OpenAI has agreed to pay $3.2 million to settle allegations by the US Department of Justice that it discriminated against American job seekers by favouring foreign workers on temporary employment visas during parts of its hiring process. While the ChatGPT maker denied violating the law, the case swiftly became a high-profile enforcement action targeting hiring practices linked with America's employment-based immigration system.

'It is illegal to discriminate against US workers by preferring temporary visa holders for jobs,' said Assistant Attorney General Harmeet Dhillon of the DOJ's Civil Rights division.

'This substantial settlement ensures that OpenAI redresses harm and changes its recruitment practices so that US workers receive a fair opportunity for highly sought-after technology positions,' the DOJ had added.

The Case Was About PERM Hiring, Not General Recruitment

One detail overlooked in many reports is that the DOJ's allegations centred on the Permanent Labor Certification (PERM) process rather than OpenAI's overall hiring.

PERM is a legal requirement for many employers seeking to sponsor foreign employees for US permanent residency. Before sponsoring a worker, employers must demonstrate that qualified US workers were given a genuine opportunity to apply for the role.

According to the DOJ, OpenAI and its subsidiary Statsig allegedly failed that test by using recruitment methods that discouraged American applicants. Officials said some PERM positions were not posted on the company's public careers website, applicants were required to submit paper applications via mail instead of online, and certain vacancies were advertised on late-night radio broadcasts, making them less visible to potential US candidates.

A Break Down of the $3.2 Million Settlement

The financial settlement comprises $1.2 million in civil penalties payable to the federal government and a $2 million back-pay fund intended to compensate eligible US workers who may have been affected by the hiring practices.

More significant than the payment itself are the operational changes OpenAI must implement.

The company agreed to publicly advertise future PERM positions on its careers website, accept electronic job applications, revise its recruitment policies, train employees on US anti-discrimination requirements, and submit to government monitoring designed to ensure future compliance.

OpenAI reiterated that it disagrees with the DOJ's findings and said the PERM programme remains essential for supporting employees who require immigration sponsorship. Note that the settlement does not constitute an admission of wrongdoing.

Why This Matters Beyond OpenAI

The case is also notable because it forms part of a broader DOJ initiative relaunched last year to investigate whether employers improperly favour temporary visa holders over US workers.

According to the Justice Department, 13 employers have now settled similar allegations since the initiative resumed. However, OpenAI is by far the most prominent AI company to reach such an agreement, suggesting that federal enforcement is expanding beyond traditional technology firms into the rapidly growing AI sector.

The action also aligns with wider efforts by the Trump administration to tighten oversight of employment-based immigration. Recent proposals have included hiking fees for H-1B visas and considering new costs for international graduates seeking work authorisation in the US. Although some of those proposals have faced challenges, the OpenAI settlement demonstrates that enforcement of existing employment laws is becoming a central policy tool.