US Plans to Eliminate 60-Day Grace Period for Work Visa Termination

The Department of Homeland Security has announced proposed rules in the Federal Register to eliminate the discretionary 60-day grace period for non-immigrant workers after termination. This affects H-1B, H-1B1, L-1, O-1, E-1, E-2, E-3, and TN primary applicants and their families. The rules are not yet in effect, and the current grace period remains applicable, pending about two months of public comment before finalization.

The proposed text will remove 8 CFR 214.1(l)(2). According to the draft, employment or activity termination will be considered as not maintaining status the day after termination, requiring immediate departure unless there is another basis for lawful stay, or the immigration agency exercises discretion to allow a change of status or employer. The Department of Homeland Security states that this move restores the "direct relationship between status and the job on which it is based," presuming that employers will offer the same position to equally qualified U.S. workers or refile the I-129 application.

The current grace period stems from a regulation established during the Obama administration in 2016, effective early 2017, lasting for a continuous 60 days or the shorter of the remaining validity period of the I-94, usable once per authorized period. The department could shorten it on a case-by-case basis, but this was rarely utilized. During this window, individuals could find a new employer to submit an I-129, change status, or arrange for departure. The draft is signed by Secretary Markwayne Mullin, case number USCIS-2026-0364, RIN 1615-AD22; the White House Office of Management and Budget has completed its review.

The department estimates that about 3,795 workers use this grace period annually to find new jobs, mostly H-1B holders; over 208,000 spouses and children are affected. From FY 2018 to May 20, 2026, over 1.9 million applications may require the immigration agency to determine if the grace period applies. In FY 2024, Indian nationals received about 71% of H-1B visas. H-1B1 corresponds to Chile and Singapore, E-3 corresponds to Australia, and TN corresponds to professionals from Canada and Mexico.

Before the rules take effect, mandatory departure the day after termination does not automatically occur. After finalization, the time for changing employers within the U.S. will be compressed to before the termination date, with insufficient postage. The immigration agency can still forgive status interruptions on a case-by-case basis, but the draft changes the default from "up to 60 days still counts as maintaining status" to "status is lost the next day."

In market mechanisms, this rule is expected to change labor friction, not an immediate wave of deportations. The buyers are tech and consulting employers relying on H-1B/L-1, who must compress layoffs, handovers, and submissions to before the termination date; the sellers are employees and their families holding such visas. The flow of funds shifts to urgent lawyers, outbound tickets, and offshore resubmissions, rather than domestic job-hopping intermediaries within 60 days. Beneficiaries are employers who can prepare multiple I-129s in advance and candidates available to start immediately in the U.S.; under pressure are foreign employees who need to sell homes, transfer schools, and find new jobs after being laid off. The event is driven by the proposed rules, and transactions and layoffs will be expedited, rather than waiting for the official law to take effect.

On a supplementary level, the grace period remains in effect until the end of the comment period. The final text, exceptions, and implementation date will be subject to the finalization in the Federal Register, and the draft cannot be treated as an effective law.

Source: Public Information