Yes, it can be illegal. Employers may sponsor visa workers. They may not fire, refuse to hire or mistreat U.S. citizens because they are U.S. citizens or American. A 2024 federal appeals ruling and a wave of 2026 federal settlements make these claims stronger in California than ever.
What employers cannot do
- Fire or lay off U.S. citizens because they prefer visa workers.
- Reserve jobs for visa holders, or make it hard for U.S. workers to apply.
- Pay, promote or assign U.S. workers worse because of their citizenship.
- Favor workers of one national origin over American workers.
Three laws that protect you
- 42 U.S.C. §1981. Covers discrimination because you are a U.S. citizen, in hiring, firing and job terms. You file a lawsuit in federal or state court. Deadline: 4 years for firing; 2 years for refusal to hire.
- Immigration and Nationality Act, 8 U.S.C. §1324b. Covers citizenship status discrimination by employers with 4 or more employees, including preferring temporary visa workers. You file a charge with the DOJ Immigrant and Employee Rights Section. Deadline: 180 days.
- California FEHA. Covers national origin and ancestry discrimination, including against Americans, by employers with 5 or more employees. You file with the California Civil Rights Department. Deadline: 3 years to file, then 1 year to sue after the right-to-sue notice.
- Federal Title VII. Covers national origin discrimination by employers with 15 or more employees. You file with the EEOC. Deadline: 300 days to file, then 90 days to sue after the right-to-sue notice.
In California, a firing driven by a FEHA violation can also support a claim for wrongful termination in violation of public policy, usually due within 2 years. The §1324b protections cover U.S. citizens and nationals, refugees, asylees and recent permanent residents.
The ruling that matters in California
In Rajaram v. Meta Platforms, Inc., 105 F.4th 1179 (9th Cir. 2024), a naturalized U.S. citizen alleged Meta refused to hire him because it preferred H-1B workers it could pay less. The Ninth Circuit, the federal appeals court over California, held that §1981 "prohibits discrimination in hiring against United States citizens on the basis of their citizenship" and revived his case. Section 1981 also covers firing and the terms of your job.
Federal enforcement in 2026
- Instacart (San Francisco). October 20, 2026: $5 million settlement with the DOJ and EEOC over alleged discrimination against U.S. workers in favor of visa workers.
- Cloudera (Santa Clara). Sued April 28, 2026 over an alleged separate hiring process that kept U.S. workers out of high-paying tech jobs. Settled October 16, 2026: $600,000 penalty, $1.4 million back pay for U.S. workers, 24-month PERM ban.
- OpenAI (San Francisco) and Statsig. August 4, 2026: $3.2 million settlement over alleged discrimination against U.S. workers in green card (PERM) recruiting.
None of the companies admitted wrongdoing. The pattern is the point: the federal government is treating discrimination against U.S. workers as a priority, and Bay Area tech companies are the focus.
Signs to watch for
- Your team is replaced by visa workers or an outside staffing firm.
- Layoffs fall mostly on U.S. citizens while visa holders keep their jobs.
- A manager favors people from his or her own country.
- Jobs are posted only in hard-to-find places, or applications must be mailed.
- You trained your replacement before being let go.
What to do now
- Write down dates, names and who replaced you.
- Keep your own records: offer letter, reviews, layoff notice, pay stubs. Do not take confidential company files.
- Do not sign a severance agreement before talking to a lawyer. It may waive these claims.
- Move fast. The DOJ charge deadline is 180 days.
- Call (510) 856-4421 for a free consultation.
Is it legal for my company to hire H-1B workers?
Yes. What is illegal is preferring them over U.S. workers because of citizenship or national origin.
I'm a naturalized citizen. Am I protected?
Yes. The plaintiff in Rajaram was a naturalized U.S. citizen.
Do I need proof of a policy?
No. Patterns, timing, comments and who replaced you can all be evidence. A lawyer can help you see what you have.
Can I file with the government and also sue?
Often yes. The right order depends on your facts and deadlines.
Related pages
Replaced by visa workers? Call (510) 856-4421. Free, confidential consultation. Hablamos español.
Reviewed by Daniel Weltin, attorney at law. Updated November 2026. This guide is general information, not legal advice for your case. Prior results do not guarantee a similar outcome.
