The US department of homeland security (DHS) on Thursday released a draft proposal to eliminate the 60-day grace period, currently available to certain non-immigrant workers (such as H-1B and L-1 visa holders) following termination of employment. While the proposal covers several employment-based non-immigrant visa categories, from the perspective of the Indian diaspora, the most significant impact would be on H-1B visa holders, L-1 visa holders (those on intra-company transfers) and O-1 visa holders (this visa is given to those who are recognised for extraordinary ability).Under the existing framework, following a layoff or other termination of employment, these visa holders are typically granted a discretionary grace period of up to 60-days, or until the end of their authorised stay, whichever comes first. The grace period can provide valuable time to find another employer, seek a change of status (say transition to a B-visitor visa) or make arrangements to leave the US.The proposal marks a significant reversal of a policy DHS itself introduced in 2016. At the time, the agency recognised that the abrupt loss of employment was not necessarily the worker’s fault and that allowing highly skilled workers time to find new employment could benefit both foreign workers and US employers.The proposed rule now argues that the 60-day provision goes against the employment-linked nature of these immigration classifications. DHS states: “The up to 60-day discretionary grace period disconnects the alien’s lawful status from the very basis of eligibility under these employment-based non-immigrant classifications.” The agency also says the earlier rule “did not sufficiently consider the negative impacts of the grace period provision.”Notably, DHS acknowledges that scrapping the grace period would carry human and economic costs. The department says some affected workers could suffer monetarily because they would have to leave the US and subsequently seek readmission rather than remain in the country while looking for new employment. It also acknowledges that some workers could receive Notices to Appear (NTAs) and potentially enter removal proceedings.DHS further recognises the extent to which foreign workers and their families may have put down roots in the US. In the proposal, it notes that such workers and their dependents may have “purchased houses, paid taxes, and may have otherwise invested in the local community in reliance on the alien’s continued stay in the US.” They may also have made career and personal plans on the assumption that they could remain in legal status for up to 60 days after their employment ended while seeking a new status.Despite such acknowledgement DHS concludes that the costs of retaining the grace period are outweighed by what it describes as the need to restore the employment-linked nature of the non-immigrant classifications and reduce the administrative burden on US Citizenship and Immigration Services (USCIS).The proposed rule is open for public comments and the entire process up to issue of a final rule could take several months.Cyrus D. Mehta, a US immigration attorney, states “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 US immediately, unless 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.”The potential impact on Indians is significant. According to the latest USCIS data for fiscal year ended Sept 30, 2025, 57,747 India-born beneficiaries accounted for 50.3 percent of the 1,14,806 H-1B petitions approved for initial employment. The concentration was substantially higher among continuing employment cases: 2,26,359 India-born beneficiaries accounted for 77.6 percent of the 2,91,542 H-1B petitions approved for continuing employment.Immigration attorneys point out that the Trump administration had already begun tightening the net around laid-off foreign workers in recent months. Workers using the 60-day period to seek a change to B-1/B-2 visitor status allowing them to remain lawfully in the US while looking for new employment, have increasingly faced Requests for Evidence (RFEs) and, in some cases, Notices of Intent to Deny (NOIDs).Thus, while currently the 60-day grace period currently remains until a final rule is introduced, transiting to a new visa status remains challenging.
