A proposed rule that could strip critical protections from hundreds of thousands of foreign workers in the United States has cleared a key federal hurdle, moving one step closer to potential publication and public comment.
The Department of Homeland Security (DHS) proposal, titled "Eliminating the Discretionary 60-day Grace Period," completed review by the White House Office of Information and Regulatory Affairs (OIRA) on August 27, 2026.
The proposal, tracked under RIN 1615-AD22, was originally submitted to OIRA for review on August 6, 2026.
The completion of OIRA review clears the way for DHS to publish the proposed rule in the Federal Register.
The next step is publication in the Federal Register for a public comment period, typically 30 or 60 days.
What the Proposal Would Do
If finalized, this would affect H-1B, H-1B1, L-1, O-1, TN, E-1, E-2, and E-3 workers, and it would sharply compress the timeline HR teams have to manage layoffs and offboarding for foreign national employees.
Under current regulations, certain nonimmigrant workers, including those in H-1B status, may receive a discretionary grace period of up to 60 consecutive days after the employment supporting their status ends.
For an H-1B worker who is laid off, this period can provide valuable time to find a new employer, pursue another eligible immigration status, or prepare to leave the United States.
The DHS proposal removes that automatic buffer entirely. Under the new framework, a laid-off H-1B worker needs a new employer petition filed and receipted before the last day of pay. If not, the worker falls out of status the same day employment ends.
History of the Grace Period
The sixty-day grace period was implemented in 2016 by regulation and formally went into effect in 2017. Prior to this regulation, no such grace period existed.
Up until January 17, 2017, whenever workers in nonimmigrant status got terminated, they were immediately considered to be in violation of status. There was also no grace period to depart the United States. Therefore, if a worker got terminated on a Friday, and did not depart on the same day, but only booked the flight home on Sunday, this individual would need to disclose on a future visa application, for all times, that they had violated status.
The grace period was created by a January 2017 DHS rule on retention of high-skilled workers. It has become the standard safety net through tech layoffs since 2022.
The Current Grace Period Remains in Effect — For Now
Immigration attorneys and agencies are emphasizing one critical point: nothing has changed yet for workers on the ground.
This does not mean the 60-day grace period has already ended. The measure is still a proposed rule and must move through additional steps before a change can take effect.
Clearing OIRA review is an important step in the federal rulemaking process, but it does not make the proposal law or immediately change existing immigration regulations.
DHS must first publish the proposed rule in the Federal Register, after which the public will have an opportunity to comment. DHS would then need to consider those comments and issue a final rule before any regulatory change could take effect. Since the proposed rule has not yet been published, its exact provisions and any transition rules are not yet known.
The contents of the proposed rule are not public yet.
This means key details — including any potential transition provisions, exceptions, or alternative timelines — remain unknown.
Broader Policy Context
The proposal is one of a series of Trump administration policy measures disrupting the H-1B program, including a proposal this week for a $103,265 fee for new hires.
The moves form the core of an H-1B crackdown that employers and workers are confronting alongside higher fees, wage-weighted selection and lengthy employment-based green card backlogs.
DHS has the discretion to shorten or refuse the grace period, but rarely did so until recent months, with refusals becoming more common.
Impact on Workers and Families
The proposed elimination is expected to fall disproportionately on certain communities.
Indian nationals accounted for approximately 71% of all approved H-1B petitions in 2024, so the proposed change is expected to fall disproportionately on Indian-American professionals.
Workers may have mortgages, car leases and children enrolled in local schools. Removing the existing window would give families zero time to wind down those obligations, community leaders and immigration experts say.
Immigration attorney Goel noted that the proposal undermines the country's competitive position.
"It cuts against the stated goal of attracting skilled talent to the U.S. economy," he said.
On the other side of the debate,
supporters argue that eliminating the protection would prevent misuse, while critics say it would create immigration cliffs for workers who complied with the rules.
Implications for Employers
The ripple effects extend well beyond individual workers.
Employers with large H-1B, L-1, or TN populations should begin tracking this proposal now, since its eventual finalization would materially compress
the timelines available during layoffs and corporate restructurings.
Employers and individuals should start reviewing offboarding processes and contingency plans now, before any rule takes effect.
For multinational companies accustomed to using the grace period as a bridge during internal transfers or reorganizations, the change would fundamentally alter standard HR operating procedures.
What Workers and Employers Should Do Now
While no immediate action is legally required, immigration practitioners broadly recommend the following steps:
- Stay informed. Monitor the Federal Register for publication of the proposed rule, which could come at any time now that OIRA review is complete.
- Prepare to comment. Once the rule is published, there will be a public comment period — typically 30 to 60 days — during which individuals, employers, and advocacy organizations can submit formal objections or support.
- Review contingency plans. Workers in employment-based visa categories should consider what options they would have if the grace period were eliminated, including H-1B portability, change of status filings, or travel planning.
- Consult legal counsel.
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This article is for informational purposes only and does not constitute legal advice. If you are an H-1B, L-1, O-1, TN, or other employment-based visa holder concerned about how this proposal may affect your status, contact an experienced immigration attorney to discuss your specific circumstances.