US Proposes New Rule To Scrap 60-Day Grace Period For H-1B Workers After Job Loss

Washington : The US has proposed a new rule to scrap the 60-day grace period available to certain foreign workers, including skilled workers on H-1B visas, to find a new job after losing employment.

The move will significantly impact Indian technology workers hired by tech companies and others on H-1B visas.

The H-1B visa is a non-immigrant visa that allows US companies to employ foreign workers in speciality occupations that require theoretical or technical expertise.

The new rule titled “Eliminating the Discretionary 60-day Grace Period” will be published in the Federal Register on Friday, and the Department of Homeland Security (DHS) has invited comments from the public within the next 60 days.

If the rule is finalised, foreign workers facing job loss before the expiry of their visas would need to leave the United States immediately, unless they have separate authorisation to remain.

Under the proposal, the DHS would eliminate the discretionary, maximum 60-day grace period currently accorded to E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1 and TN nonimmigrants, and their dependents, whose employment ceases.

The grace period was added under Obama-era regulations to allow workers to more easily change employers by letting them remain in the US to pursue new job offers.

In its proposal, DHS acknowledges that if the grace period regulation is eliminated, some affected foreign nationals could be issued Notices to Appear (NTA), the government’s first step in initiating removal (deportation) proceedings, Fragomen, an immigration attorney firm, said.

The prospect of NTA issuance may be likelier for those in nonimmigrant categories that require an employer to immediately notify the government when employment of the foreign national has ceased, including H-1B, O-1, and P.

DHS created the up to 60-day grace period rule in 2016 with an aim to enhance job portability, stability, and flexibility for high-skilled workers, and to make it easier for US employers to hire and transition nonimmigrant talent.

It allowed affected individuals to seek other employment in the same nonimmigrant category or change status without the need to depart the United States, or to prepare for departure. The grace period applies whether the employment cessation is voluntary or involuntary.

According to DHS estimates, primary beneficiaries who experienced either cessation of employment or voluntarily changed employers are 65,752 in 2025, with a high of 80,034 in FY 2023 and a low of 40,959 in FY 2021.

From FY 2021 through FY 2025, 5.77 per cent of 328,758 primary beneficiaries who either lost their job or changed employers had a new petition for nonimmigrant workers submitted on their behalf by a new employer.

If the proposal is finalised, workers facing job loss would have to leave the country and reapply at an American embassy or consulate after receiving an offer from another US employer.

The US law allows for 65,000 H-1B visas annually, with another 20,000 reserved for people who hold advanced degrees from American higher education institutions.

It is the latest step by US President Donald Trump to limit legal migration since returning to office in January 2025. (Agencies)