H-1B shock? US may end 60-day job-loss grace period for foreign workers

H-1B Workers Could Lose 60-Day Safety Net Under New US Proposal

The Trump administration is moving to eliminate a 60-day grace period that has, since 2017, given certain foreign workers a crucial window to find a new job or change immigration status after losing employment in the United States. If finalised, the move could significantly tighten the rules for H-1B workers—and Indian professionals could be among the largest groups affected.

 

The Department of Homeland Security (DHS) has proposed eliminating the discretionary 60-day grace period available to certain employment-based nonimmigrants when their employment ends before their authorised stay expires.

 

The proposal, formally titled “Eliminating the Discretionary 60-day Grace Period”, cleared review by the White House Office of Information and Regulatory Affairs (OIRA) on August 27. The official regulatory database lists it as a proposed rule and said the review concluded with changes.

  

But nothing has changed yet for H-1B workers.

 

"The next step in the regulatory process is for the proposed rule to be published in the Federal Register for a public comment period, typically a period of 30 or 60 days.

 

Details of the proposal will not be known with specificity until publication. If the discretionary 60-day grace period is eliminated, foreign nationals whose employment ceases prematurely (and their dependents) would no longer be maintaining status and would generally be required to depart the United States immediately, unless U.S. Citizenship and Immigration Services (USCIS) exercises its separate discretion to forgive the lapse in status and allow the foreign national to change status or change employers within the country," said immigration law firm Fragomen in a note.

 

What is the 60-day grace period?

 

The provision was created through a 2016 DHS regulation that took effect in 2017. It was designed to give certain highly skilled foreign workers some flexibility if their employment unexpectedly ended before their authorised period of stay.

 

Under the current system, eligible workers can receive up to 60 consecutive days—or until their authorised validity period expires, whichever comes first. The worker cannot work during the grace period, but can use the time to find another sponsoring employer, seek a change of status or prepare to leave the US.

 

The provision covers several categories, including:

 

• H-1B
• H-1B1
• L-1
• O-1
• E-1
• E-2
• E-3
• TN

 

Dependants can also be affected because their status is generally tied to that of the principal worker. Immigration lawyers say the proposed change could therefore have consequences not only for employees but also for their families.

 

What happens if the grace period disappears?

 

This is where the proposed change could become significant.

 

Today, an H-1B worker who is laid off can use the grace period to find another employer willing to sponsor them. The new employer can file an H-1B petition, allowing the worker to transition to the new job without first having to leave the country, assuming the applicable requirements are met.

 

If the grace period is eliminated, the loss of employment could create immediate status consequences rather than giving the worker a defined 60-day cushion.

 

Sarah Schroeder, an immigration attorney at DiRaimondo & Schroeder, said that if the proposal is ultimately finalised, workers and their dependants could face significantly less ability to remain in the US while pursuing a new employer or another immigration option.

 

Klasko Immigration Law Partners similarly warned that eliminating the grace period would leave affected workers with little time to respond to an unexpected job loss.

 

There is an important caveat: the exact mechanics are not yet known because DHS has not published the actual proposed regulatory text. Immigration lawyers therefore cautioned against assuming precisely what the final regime would look like.

 

Why the change matters for Indian professionals

 

The proposal is particularly significant for Indian technology and other skilled professionals because Indians account for a large share of H-1B workers. In FY2024, 71% of approved H-1B petitions were for people born in India. That means any change that makes it harder for H-1B workers to transition between employers could disproportionately affect Indian professionals working in the US.

 

The issue also comes at a time when the administration is pursuing several other changes to the H-1B system. The Trump administration has proposed a $103,265 fee for new cap-subject H-1B petitions, while the programme is also facing enhanced scrutiny and other regulatory changes.

 

For workers, the combination could mean that losing a job becomes considerably more consequential: the worker could have less time to secure another sponsor at a time when employers are themselves facing higher costs for hiring new H-1B talent.

 

Why was the 60-day window created in the first place?

 

The grace period was explicitly intended to improve job portability and stability for highly skilled foreign workers.

 

When DHS introduced the provision in 2016, it said the 60-day period would give qualifying workers facing termination flexibility to remain in the US without violating their status while seeking a new job or pursuing another immigration option.

 

USCIS itself has previously acknowledged the importance of the provision.

 

In a 2023 response concerning technology-sector layoffs, USCIS said it understood the impact of job loss on employment-based nonimmigrant workers and noted that the grace period gives workers time to find new employment or explore options such as changing to another nonimmigrant status.

 

That history is important because the proposed elimination would effectively reverse a mechanism originally introduced to make the skilled-worker immigration system more flexible.

 

What immigration lawyers are telling workers now

 

The immediate advice from immigration practitioners is not to panic or act as though the grace period has already been abolished.

 

The existing rules remain in force.

 

Sarah Schroeder of DiRaimondo & Schroeder specifically noted that clearing OIRA review does not itself change the law. The proposal still has to be published, opened to public comment and subsequently finalised before any regulatory change takes effect.

 

"Nevertheless, employers should be aware that, if finalized, the proposal could materially affect immigration planning surrounding terminations, reductions in force, voluntary departures, and employee transitions between employers. Foreign nationals contemplating a change in employment should likewise seek immigration advice promptly rather than relying on the availability of the full 60-day period," said Schroeder.

 

Goel & Anderson likewise said there is no immediate change for employers or foreign workers and that the current 60-day period remains fully available.

 

But lawyers recommended that employers and workers closely monitor the process because the final rule could materially alter the options available after a termination.

 

What could a laid-off H-1B worker do today?

 

Under the current rules, an eligible worker who loses employment may generally use the grace period to:

 

Find another employer: A prospective employer can file a qualifying H-1B petition.

 

Change immigration status: Depending on the individual's circumstances, a worker may seek to change to another nonimmigrant status.

 

Prepare to leave the US: The grace period can also provide time to organise departure rather than requiring an immediate exit.