The Trump administration has officially proposed eliminating the 60-day grace period that currently allows certain immigrants, including skilled workers on H-1B visas, to stay in the United States and find a new sponsor after losing their job. According to the latest notice published Friday in the Federal Register by the U.S. Department of Homeland Security (DHS), the proposal would remove regulation 8 CFR 214.1(l)(2) that has been in place since 2017. The current rule allows eligible workers to remain in the US for up to 60 days after losing or leaving a job, or until their authorized stay expires, whichever comes first. The proposed change would require affected workers to leave the United States immediately unless they have another legal basis to stay, as reported by Reuters. Under the proposed framework, the end of the employment or activity that supports the visa status would once again have a more direct impact on the worker's lawful status, restoring the earlier policy under which an individual's nonimmigrant status was directly tied to the employment or activity that formed the basis for their admission. The Department of Homeland Security (DHS) has invited comments from the public within the next 60 days before the proposal can be finalized.
The proposed change could significantly impact Indian technology professionals who make up a major share of H-1B visa holders and are employed across the US technology and services sector. H-1B visas are particularly important to the US technology industry, which relies heavily on skilled workers from India and China. Indian IT companies including Tata Consultancy Services, Infosys, HCLTech and LTIMindtree are among major H-1B sponsors, alongside consultancy firms such as Deloitte, PwC and Ernst & Young. For Indian professionals working in the US, the proposed change could sharply reduce the time available to secure a new employer after a layoff. Lawyers at Berardi Immigration Law said the move would 'sharply compress the timeline HR teams have to manage layoffs and offboarding for foreign national employees', according to Reuters. The proposed rule would extend beyond H-1B holders to cover E-1 international traders, E-2 commercial vehicle operators, L-1 workers who are executives or managers at international companies, O-1 visa holders with extraordinary ability in fields including science, sports or the arts, and TN professional workers. Additionally, H-1B1 skilled workers from Singapore and Chile and E-3 speciality workers from Australia would also be affected by the proposed changes, as well as their eligible dependants.
During the period covered by the data, 18,975 beneficiaries had a new Form I-129 petition filed on their behalf within the 60-day period, representing 5.77% of affected workers. Around 99% of the beneficiaries in the data belonged to the H-1B category, as reported by Reuters. In fiscal 2025, 5,178 beneficiaries had a new employer file a Form I-129 petition for them within the grace period, with DHS estimating that 2,886 employers had filed such petitions that year. The proposal notes that employers may face additional costs because they could have to pay for a worker's return transportation after termination. Workers who lose their jobs could have to leave the country before finding a new employer or completing immigration paperwork, and their dependants could also lose their status because it is tied to the principal worker's status. DHS estimates that the rule could affect employers as well, with about 2,886 unique entities submitting Form I-129 change-of-employer petitions for approximately 5,178 workers whose previous petitions had been revoked after employment ended in fiscal 2025. Of those entities, 1,852 were classified as small businesses.
The rule change would apply to multiple visa categories beyond H-1B, as reported by Reuters. It would impact E-1 international trader visa holders; E-2 commercial vehicle operator visa holders; L-1 short-term work for executives or managers with international companies; O-1 visas for people with extraordinary ability in science, sports or the arts; and TN professional workers from Canada and Mexico. Additionally, it would affect H-1B1 skilled worker visa holders from Singapore and Chile and E-3 specialty worker visa holders from Australia. The Department of Homeland Security stated that 'DHS presumes that they will either offer the same jobs to equally qualified U.S. workers or go through the I-129 petition process depending on their workforce requirement'. The proposal would also make a technical change to remove a cross-reference to the 60-day grace-period provision from the regulations governing employment-based immigrant petitions. The Department acknowledged that 'removal of the up to 60-day discretionary grace period' would better align the regulations with the statutory basis of the employment-based classifications and reduce administrative burden.
The proposal could have more serious immigration consequences for affected workers, as reported by Business Standard. Immigration law firm Fragomen said the removal of the grace-period regulation could result in some affected foreign nationals receiving a Notice to Appear, which is the government's first formal step towards starting removal proceedings. The risk could be higher for visa categories where employers are required to promptly notify the government when a foreign worker's employment ends. For an H-1B professional, this means that losing a job could become an immigration issue much more quickly than under the existing system. The current grace-period framework was introduced in 2016 during the Barack Obama administration with the objective of providing greater job portability and flexibility to highly skilled foreign workers and making it easier for US employers to retain or hire such workers. However, DHS estimates that the number of primary beneficiaries who either experienced a cessation of employment or voluntarily changed employers was 65,752 in 2025, with the figure as high as 80,034 in fiscal year 2023 and falling to 40,959 in fiscal year 2021.
