US plans to end H-1B 60-day grace period after job loss: What will be its impact on Indians?

The United States has proposed doing away with the discretionary 60-day grace period that currently gives certain foreign workers time to look for a new job after their employment ends. The proposal could have major implications for skilled foreign professionals, including thousands of Indian workers employed in the US on . Under the proposed rule, foreign nationals whose employment comes to an end could lose the additional time currently available to find another employer or make arrangements to leave the country. If the proposal is eventually implemented, workers whose visas remain valid but whose qualifying employment has ended may have to leave the US immediately unless they have another independent legal basis to stay.

The Department of Homeland Security (DHS) has proposed a rule, “Eliminating the Discretionary 60-day Grace Period.” The proposal will be published in the Federal Register Friday, and members of the public will have 60 days to submit their comments.

Under the proposed change, some nonimmigrant workers and their dependents would no longer have the discretionary maximum of 60 days after the end of their employment. Categories include E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1, and TN visa holders.

“The proposed change is designed to reestablish a closer link between the immigration status of a foreign national and the employment or activity for which the person was admitted to the U.S.,” DHS said. "“The proposal reinstates a direct link between an alien’s nonimmigrant status and the specific employment or activity that served as the basis for admission or grant of status in the United States and decreases administrative burdens,” the DHS said.

H-1B is a program that allows American companies to hire foreign workers in specialized jobs requiring theoretical or technical expertise. The program is heavily used by tech companies to recruit talented workers from countries like India and China.

For an H-1B worker who loses a job unexpectedly, the current grace period can provide critical time to find another qualifying job, file the required paperwork or arrange to leave the country.

The agency’s proposed rule could change that equation in a big way. Without the grace period, a job loss could mean the worker has to leave the US without the extra window that currently allows them to look for another employer from within the country.

The 60-day provision currently allows an affected worker time to seek employment with another company, change their immigration status where eligible or prepare to leave the United States.The grace period applies to voluntary termination of employment and also to involuntary termination of the worker.

If the proposed rule is finalized, a worker who loses employment would generally have to leave the US unless they have another valid authorization permitting them to remain. If they later find a job with another American firm they may have to go through the appropriate visa process outside the country, including, where necessary, applying at a US embassy or consulate.

The grace-period provision was added in 2016 during the Obama administration. It said its purpose was to give highly skilled foreign workers more job mobility, stability and flexibility.The provision also was intended to make it easier for American employers to hire and transition foreign professionals, giving affected workers some limited time between jobs without having to leave the country immediately.The Trump administration’s latest proposal would reverse that policy for the categories covered by the rule.

That has been another possible effect of the abolition of the grace period, according to immigration law firm Fragomen. Some foreign nationals affected by the change, the firm says, may receive Notices to Appear, or NTAs.An NTA is the government’s first step in initiating formal removal proceedings against an individual.

It may be more significant for some nonimmigrant categories for which employers must notify the government when a foreign worker is no longer employed. Specifically, Fragomen cited H-1B, O-1 and P categories in this regard.That means the proposed change could have implications beyond just shortening the time someone has to find another job.

DHS estimates that in 2025 there were 65,752 primary beneficiaries who either stopped working or changed employers voluntarily. The figure peaked at 80,034 in fiscal year 2023 and bottomed out at 40,959 in fiscal year 2021.During fiscal years 2021 through 2025, 5.77 percent of the 328,758 primary beneficiaries who either lost a job or changed employers filed a new petition for nonimmigrant workers with a new employer.

The US immigration system currently allows for 65,000 H-1B visas per year under the regular cap. There are 20,000 other visas reserved for foreign nationals who have earned advanced degrees from US institutions of higher education. This program is particularly important for the technology sector which relies heavily on overseas workers for specialist positions. Therefore, Indian professionals face a direct impact on their job security and ability to stay in the US after an unforeseen termination due to any modifications in the H-1B employment rules.