That's one smart employer in my opinion... It is partially "legal" and partially not. Namely, it is NOT legal for the employer to ask you to "contribute" money to the "PERM" labor certification process with DOL, usually the first step in the long and arduous "green card" application process. It is, however, "legal" for employer to ask you to contribute money to the ensuing I140 Immigrant visa petition to be filed with USCIS, in the aftermath of the PERM approval (you hope.)
Kindly be advised that the answer above is only general in nature cannot be construed as legal advice, given that not enough facts are known. It is your responsibility to retain a lawyer to analyze the facts specific to your particular situation in order to give you specific advice. Specific answers will require cognizance of all pertinent facts about your case. Any answers offered on Avvo are of a general nature only, and are not meant to create an attorney-client relationship.
Your employer is legally required to pay all expenses incurred in filing a PERM application on your behalf. The fees for the rest of your case are negotiable between your employer and you.
Mr. Shusterman's (former INS Trial Attorney, 1976-82) response to your question is general in nature, as not all the facts are known to him. You should retain an attorney experienced in immigration law to review all the facts in your case in order to receive advice specific to your case. Mr. Shusterman's statement above does not create an attorney/client relationship.