Compliance Round Up – A Court Voids the $100,000 H-1B Fee, the Third Circuit Narrows FLSA Overtime Claims, and New Jersey Clears the Way for Cannabis Bias Suits (June 2026)

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Written By
Jennifer Kiesewetter
Published On: June 15, 2026

Jenny Kiesewetter is a practicing ERISA and employee benefits attorney who partners with HR teams on a wide range of workplace compliance matters — from benefit-plan obligations to day-to-day HR policies and regulatory requirements. Her guidance helps employers spot risks early, navigate regulatory change, and make informed decisions that support both employees and the organization.

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Federal courts in early June 2026 invalidated the $100,000 H-1B fee and vacated USCIS processing-hold policies, while the Third Circuit narrowed FLSA overtime gap-time claims and New Jersey expanded cannabis-discrimination exposure. Oregon, Colorado, and New Jersey advanced immigrant-worker protections, demographic reporting, and cannabis litigation. Here are the six developments HR teams should track now.

Federal News

Effective Date: June 8, 2026, date of ruling (State of California vs. Markwayne Mullin, U.S. District Court for the District of Massachusetts)

What’s Changing:

On June 8, 2026, a federal judge in Massachusetts invalidated the $100,000 fee for new H-1B visas, ruling that the President lacked the authority to impose it. The fee came from a September 19, 2025, White House proclamation, and a coalition of 20 states challenged it in court.

The court also found the administration violated the Administrative Procedure Act (APA) by skipping notice-and-comment rulemaking and ruled the policy arbitrary and capricious. The administration has signaled it will appeal and seek a stay, which could reinstate the fee and put employers back in limbo.

What This Means for HR:

  • Pause payment of the $100,000 fee on new H-1B petitions for now, but plan for a possible stay that reinstates it.
  • Track every pending and planned H-1B filing, and document any fees already paid in case reimbursement becomes available.
  • Coordinate timing with immigration counsel before filing, because an appeal could change the rules quickly.

Effective Date: June 5, 2026, date of ruling (v. USCIS, Dorcas International Institute of Rhode Island U.S. District Court for the District of Rhode Island)

What’s Changing?

On June 5, 2026, a federal court in Rhode Island vacated a U.S. Citizenship and Immigration Services (USCIS) freeze on adjudicating immigration benefit requests, including green cards, Employment Authorization Documents (EADs), and nonimmigrant petitions, for applicants from 39 countries the government had designated as high risk, along with foreign nationals holding Palestinian Authority documents. The court also struck a global asylum hold, a re-review policy for previously approved benefits, and a country-specific factors policy.

In Dorcas International Institute of Rhode Island v. USCIS, Chief Judge John J. McConnell, Jr. found that the policies violated the Administrative Procedure Act and were arbitrary and capricious. The ruling should allow USCIS to resume adjudicating stalled Form I-129, Form I-485, and Form I-765 cases, though the government may appeal or seek a stay.

What This Means for HR:

  • Identify sponsored employees from the affected countries whose Form I-129, I-485, or I-765 cases have stalled, and prepare for adjudications to resume.
  • Monitor any government stay or appeal that could re-freeze those cases.
  • Update work-authorization tracking so resumed approvals do not create avoidable gaps.

Trending State News

Effective Date: Signed June 4, 2026 (House Bill 26-1207); reporting begins July 1, 2027

What’s Changing?

Colorado Governor Jared Polis signed House Bill 26-1207 on June 4, 2026, requiring employers meeting the statutory threshold to provide EEO-1 demographic data to the Colorado Secretary of State as part of periodic reporting beginning July 1, 2027. The law states that the obligation applies even if the federal EEO-1 reporting requirement goes away.

The measure responds directly to the U.S. Equal Employment Opportunity Commission’s pending proposal to eliminate EEO-1 reporting. Colorado’s approach may signal a broader state-level push to preserve demographic-reporting obligations, since Massachusetts, Illinois, and California already rely on EEO-1 data.

What This Means for HR:

  • Prepare to report EEO-1-style demographic data to the Colorado Secretary of State starting July 1, 2027, regardless of what happens at the federal level.
  • Continue collecting and preserving EEO-1 demographic data even if the federal obligation ends; multiple states still depend on it.
  • Watch for other states to follow Colorado by locking in state-level demographic reporting.

Effective Date: June 5, 2026 (House Bill 4111)

What’s Changing?

Oregon House Bill 4111 took effect June 5, 2026, barring employers from taking adverse action against employees who update their personal information after a lawful change in work-authorization status. The law treats such updates as protected activity and folds these protections into the state’s employment-discrimination framework under Oregon Revised Statutes (ORS) Chapter 659A, opening the door to compensatory and punitive damages, attorney fees, and jury trials.

The law also limits when an immigration status may be admitted into evidence in civil litigation. Courts generally must exclude that information unless it is essential to a claim or defense, and they must conduct a confidential review by the judge first. As a result, routine onboarding, reverification, and recordkeeping now carry a risk of discrimination and retaliation if HR handles them inconsistently.

What This Means for HR:

  • Administer onboarding, reverification, and personnel-record updates neutrally and consistently; an employee correcting a name or Social Security number after a status change is now protected.
  • Review honesty and document-fraud policies, which should not penalize an employee who corrects records after a lawful status change.
  • Train HR on handling immigration-status information, since Oregon now sharply limits its use in litigation.

Around the Courts

Effective Date: May 26, 2026 (Sanders v. Levari Group, LLC, New Jersey Appellate Division)

What’s Changing:

In Sanders v. Levari Group, LLC, decided May 26, 2026, the New Jersey Appellate Division held that the Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA) lets individuals, including job applicants, sue employers for cannabis-related employment discrimination. CREAMMA, enacted in 2021, bars adverse action based solely on lawful off-duty cannabis use or a positive test for cannabis metabolites. 

Although the statute does not expressly create a private right of action, the decision recognizes one implicitly. This diverges from prior federal authority that found no such right. The court revived the plaintiff’s claim over a rescinded job offer and allowed related negligence, privacy, and breach-of-contract theories to proceed.

What This Means for HR:

  • Expect direct lawsuits from New Jersey applicants and employees over cannabis-related decisions, including claims for back pay, emotional distress, and punitive damages.
  • Reassess drug-testing and hiring protocols, and tie any cannabis-related decision to a documented, legitimate reason such as impairment, safety risk, or a federal requirement.
  • Account for the state-versus-federal split, which makes forum selection and removal strategy important in these cases.

Effective Date: June 3, 2026, date of decision (Secretary U.S. Department of Labor v. Comprehensive Healthcare Management Services LLC, U.S. Court of Appeals for the Third Circuit)

What’s Changing:

In Secretary U.S. Department of Labor v. Comprehensive Healthcare Management Services LLC, the U.S. Court of Appeals for the Third Circuit held that the Fair Labor Standards Act (FLSA) does not allow recovery of “overtime gap time,” meaning unpaid straight-time hours in weeks when an employee also worked overtime. The case grew out of a U.S. Department of Labor enforcement action against Pennsylvania healthcare facilities, where a district court had awarded more than $35 million, including gap-time damages.

Writing for the majority, Chief Judge Chagares held that the FLSA requires only minimum wage and overtime premiums and does not provide a cause of action for overtime gap time. This rejects the Labor Department’s longstanding position. The ruling deepens a circuit split: the Third Circuit now joins the Second Circuit in rejecting these claims, while the Fourth Circuit continues to defer to the agency. Employees can still pursue unpaid straight-time wages under state law or contract theories.

What This Means for HR:

  • Recognize that employees in the Third Circuit, which covers Delaware, New Jersey, and Pennsylvania, along with the U.S. Virgin Islands territory, cannot recover unpaid non-overtime hours under the FLSA as long as all hours are paid at least the minimum wage.
  • Check state wage laws and contract obligations, because those claims remain available even when the FLSA claim fails.
  • Maintain accurate timekeeping and include all required pay in the regular rate; unreliable records still drive wage-and-hour liability.

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