H-1B Workers Could Lose 60-Day Grace Period Under DHS Proposal

On Aug. 6, 2026, DHS submitted a proposed rule, “Eliminating the Discretionary 60-day Grace Period,” to the Office of Management and Budget (OMB) that seeks to eliminate the 60-day grace period available to H-1B workers and certain other employment-based visa holders following a job loss. The full regulatory text has not yet been released publicly. If the rule is finalized, eliminating the 60-day grace period could have far-reaching consequences for skilled foreign workers, employers, and the broader U.S. talent market.

Since 2017, eligible H-1B workers who lose their jobs have generally been granted up to 60 days, or until the end of their authorized stay, whichever comes first, to find a new sponsoring employer, change immigration status, or depart the United States. The policy was introduced to provide workers with a reasonable period to address an unexpected employment termination without immediately falling out of status. The grace period applies to several employment-based visa categories, including H-1B, H-1B1, L-1, O-1, TN, E-1, E-2, and E-3 visas. Dependents whose status is tied to the principal visa holder are also impacted by the provision.

The proposed rule’s objective is to remove the existing grace period that allows affected foreign workers time to recover from job loss without immediately jeopardizing their immigration status.

The current 60-day grace period remains in effect while the rule undergoes the federal review and rulemaking process.

Why This Matters

For many H-1B professionals, a layoff does not simply mean unemployment; rather, it can trigger a race against the clock involving immigration status, family stability, housing obligations, and future career prospects.

The existing 60-day grace period allows highly skilled workers time to secure a new sponsor, complete transfer filings, or arrange to leave the country in an orderly manner. Without that protection, a terminated worker could face immediate immigration consequences, significantly reducing their ability to pursue new employment opportunities within the United States.

What Happens Next?

Additional steps, including potential public comment periods and further regulatory review, are expected before any change becomes effective. Until then, existing regulations remain unchanged.

The proposed elimination of the 60-day grace period marks a potentially significant shift in how the United States manages employment-based immigration. It serves as a reminder that immigration policy can change rapidly and affected individuals and employers should stay informed as DHS’s rulemaking process continues.

Immigration attorneys and advocacy groups are closely monitoring developments, as the proposal could represent one of the most consequential changes to employment-based immigration policy in recent years.

Jackson Lewis attorneys are available to assist employers and answer questions about how the proposed elimination of the grace period may affect your immigration program.