H-1B visa issue: Trump administration proposes scrapping 60-day grace period, Indian techies to be affected

The Donald Trump administration has proposed a new rule for all H-1B visa holders in the US. If passed, the government would eliminate a 60-day grace period that allows certain foreign workers on H-1B visas, including skilled workers, to remain in the US and look for a new sponsor in case of job loss. The government posted a notice regarding the new proposal online on Thursday.

Proposal to end 60-day grace period for H-1B visas

Under the proposed rule, published in the Federal Register by the US Department of Homeland Security (DHS), H-1B and holders of certain other temporary work visas would have to leave the country following the termination of their employment. The move could disrupt major US technology companies that rely heavily on foreign workers, including workers from India.

In this case, if someone is laid off, as it has become common practice amid rising AI-led layoffs, workers, including techies from India, will have to head back to their countries without the two-month cushion. Typically, the grace period can be utilised by the H-1B visa holders to secure another job or leave the country.

This proposal is the latest step by the US President to restrict legal migration since his return to office in January 2025. His administration has hiked the visa fees for skilled workers and recently paused immigrant visa appointments at US missions worldwide as it implements a new training programme.

Who will be impacted?

DHS acknowledged that several companies might be impacted if the new proposed rule takes effect. However, it also argued that the affected positions could be filled by US workers instead of foreigners. In some cases, foreign workers who leave the country could reapply if their employers file a new petition on their behalf.

“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 notice said, as per Reuters.

The 60-day grace period was introduced in 2017. It gives foreign workers time to find another job in the US or make arrangements to leave the country. This can include selling a home, moving belongings or withdrawing children from school.

H-1B visas were established by Congress in 1990. It remains particularly important to US technology companies that recruit skilled workers from countries such as India and China. The visa programme allows companies to hire foreign workers for specialised roles where they may face a shortage of qualified US workers.

Consultancy firms such as Deloitte, PwC and Ernst & Young, as well as outsourcing companies including Tata Consultancy Services, Infosys, HCLTech and LTIMindtree, are among the major H-1B sponsors.

Lawyers at Berardi Immigration Law, which specialises in business-related immigration, told Reuters that the proposed change would “sharply compress the timeline HR teams have to manage layoffs and offboarding for foreign national employees.”

Who else will be covered under this rule?

If implemented, the change would also cover E-1 international trader visa holders, E-2 commercial vehicle operators, L-1 visa holders working as executives or managers for international companies, O-1 visa holders with extraordinary ability in fields including science, sports or the arts, and TN professional workers.

The proposal would also affect H-1B1 skilled workers from Singapore and Chile and E-3 speciality workers from Australia.

The proposed rule is subject to a two-month public comment period before being finalised by the administration.

(with inputs from Reuters)