H-1B New Rules and Restrictions

The U.S. government has announced a dramatic change to the H-1B skilled-worker visa program: a new one-time payment of $100,000 tied to new H-1B petitions submitted after the effective date. This move is intended to reduce reliance on foreign skilled workers and encourage employers to hire more U.S. workers — but it also creates immediate uncertainty for tech firms, staffing companies, and prospective migrants.

What is the H-1B visa?

The H-1B is a nonimmigrant U.S. work visa used mainly by employers to hire foreign workers in “specialty occupations” that require technical or highly skilled knowledge — think software engineers, scientists, doctors in certain roles, and other specialized professionals. Employers file a petition on behalf of a foreign national; if approved, that person can work for the sponsoring employer in the U.S. for a limited period under H-1B status.

Most H-1B beneficiaries in recent years have been citizens of India — media and government data report roughly 70–71% of recent approvals — so any major change to the program disproportionately affects Indian nationals and Indian tech firms that supply talent to U.S. employers. The announcement produced immediate market and policy reactions from companies and governments.

 

Summary of the new rules

• A presidential proclamation requires a $100,000 payment to accompany new H-1B petitions filed on or after 12:01 a.m. Eastern on September 21, 2025. The proclamation directs agencies to restrict decisions on petitions not accompanied by the payment.
• The proclamation and subsequent agency guidance indicate this fee applies to new H-1B petitions (new beneficiaries outside the U.S.) and does not retroactively charge existing H-1B holders for entry or renewal. Multiple government and reporting sources clarified the fee is aimed at new petitions.
• The Administration also signaled higher wage standards and coordination between Departments (DHS, State, DOL) to implement the policy — meaning employers will likely face both higher upfront costs and potentially stricter wage requirements for H-1B hires.
• The policy’s practical details (how payment is collected, whether it replaces or is in addition to existing filing fees, exemptions, and national-interest waivers) are being clarified by agencies; litigation and administrative guidance are likely.

Who is affected?

(1) employers who sponsor new H-1B hires from abroad;

(2) prospective applicants outside the U.S. seeking an initial H-1B petition or lottery slot;

(3) industries heavily reliant on H-1B talent (tech, higher education, some health care roles, consulting).

Large firms may be better able to absorb the cost; smaller firms and startups face much greater relative burden.

Who might pay the $100,000 fee

Below is a practical table listing common payment permutations (real-world possibilities), who would pay in each case, and short notes on legality or likely practice. This table is a guide to likely arrangements — actual legal responsibility depends on employer policy, contracts, and agency guidance.

Scenario	Who pays the $100,000?	Notes & practical considerations
Standard employer-sponsored H-1B (employer files for candidate)	Employer (company sponsoring the petition)	Most straightforward: employer is listed on petition and is billed/required to submit payment per proclamation. Large companies likely to absorb cost; small firms may pass some cost to clients or rethink hiring.
Employee personally wants the job and asks employer to sponsor	Employer, but employee may negotiate compensation adjustments	By law many filing fees are employer responsibilities; passing this entire $100k to employee would be unusual and may face legal/market resistance. Contracts could include compensation changes.
Consulting / body-shopping model (third party client uses consultant via vendor)	Usually the sponsoring vendor employer, but cost could be distributed (vendor, client, or shared)	Agreements between vendor and client may shift costs; small vendors may raise rates or move work offshore. Practical outcome: higher client billing or reshaped contracting.
Startups hiring a foreign engineer on H-1B	Startup employer (may need external funding or pass cost via equity compensation)	For early-stage firms the $100k is substantial; some startups may opt for remote hires abroad or delay hiring until funding increases.
Universities, research nonprofits (cap-exempt employers)	Employer, but some cap-exempt categories may face exemptions or different treatment	Certain nonprofit or research institutions historically have cap-exempt status for H-1B caps; proclamations and guidance will determine whether fee applies to cap-exempt petitions. Agency guidance is needed to confirm exemptions.
Employee transfers (change of employer) for existing H-1B holders	Generally employer filing the transfer; existing H-1B holders likely exempt based on initial clarifications	White House/USCIS clarification indicated the fee targets new petitions and should not retroactively charge existing H-1B holders returning for reentry. Exact treatment of transfers will depend on agency rules.
Employer pays partially; employee paid via bonus / salary adjustment	Shared: employer + employee (negotiated)	Possible in practice if employer tries to reduce net cost; could raise legal and recruitment issues. Market pressure may determine acceptability.
Government or national-interest exemption (rare)	May be exempt or receive waiver	Proclamations allow national interest exceptions in limited circumstances; such exemptions are case-by-case and not a broad waiver.

 

If enforced as written for new petitions, the $100k fee will make sponsoring an H-1B far more expensive. Large corporations may absorb the cost, but many smaller employers, staffing firms, and startups will face heavy pressure to change hiring plans — shifting more work offshore, paying larger salaries to domestic hires, automating tasks, or substituting different visa categories. The policy also raises diplomatic tensions with key partner countries that supply much of this talent.

Top FAQs — Massive fee hike for H-1B visa

Q: Does the $100,000 fee apply to current H-1B holders?

A: Government statements and reporting say the fee applies to new petitions filed after the effective date; existing H-1B holders are not being retroactively charged for re-entry or renewal based on early clarifications. Expect more agency guidance.

Q: Who legally must pay the fee — the employer or the employee?

A: The proclamation and agency guidance treat the payment as tied to the petition (i.e., the employer filing the petition). Practically, employers may negotiate cost sharing, but many filing fees are customarily employer-paid. Expect contractual negotiations in some sectors.

Q: Will this stop people from coming to work in the U.S.?

A: It will likely reduce the number of new H-1B entries because the upfront cost is very large for many employers. Some firms may pay it; others will change hiring strategies (offshore work, automation, or hiring local talent). The long-term effect depends on enforcement, legal challenges, and subsequent agency rules.

Q: Are there exemptions (students, researchers, hospitals)?

A: The proclamation allows for agency coordination and potential exceptions (e.g., national interest), but definitive lists of exemptions require further agency rulemaking or guidance. Universities and certain nonprofit/research employers historically have special treatments for cap purposes — whether the fee applies the same way is being clarified.

Q: What should employers and applicants do now?

Employers should consult immigration counsel, review hiring plans, and monitor agency guidance closely. Prospective applicants should stay in touch with sponsors, legal counsel, and official agency updates because the situation is fluid and subject to administrative clarifications and possible litigation.

 

The sudden $100,000 fee for new H-1B petitions marks a sweeping shift in U.S. immigration policy toward skilled workers. It is designed to reshape employer incentives, but it also introduces near-term disruption for companies, prospective migrants, and countries that supply significant numbers of H-1B professionals. Expect further agency guidance, legal challenges, and market adjustments as the policy is implemented.