- Cap-exempt employers can file H-1B petitions year-round without entering the annual 85,000-visa lottery.
- Eligible organizations include universities and research nonprofits providing faster hiring for academic and medical roles.
- Recent Texas public-sector hiring freezes might limit new filings at state-funded institutions despite federal law.
(TEXAS) — Cap-exempt H-1B employers can file year-round, avoid the annual lottery, and often move faster than private employers that must wait for cap season.
For FY 2027, that difference matters. Cap-subject employers used the March 2026 registration window for an October 1, 2026 start date. Cap-exempt employers, by contrast, may file at any time if the job and employer qualify.
That makes cap-exempt H-1Bs especially important in Texas, where public universities, medical centers, and research institutions have long sponsored large numbers of workers. It also matters for employees comparing offers from universities and hospital systems against private employers like Cognizant Technology Solutions, Infosys Limited, or Tesla Inc.
Which employers are cap-exempt
An H-1B petition is usually cap-exempt if the employer is one of these:
- An institution of higher education
- A nonprofit entity related to or affiliated with an institution of higher education
- A nonprofit research organization
- A governmental research organization
These employers do not use one of the 85,000 annual cap numbers.
Public and nonprofit universities in Texas often qualify directly. Research hospitals and medical schools may also qualify. Some nonprofit entities qualify through a formal relationship with a university.
📅 Key Date: Cap-subject FY 2027 registrations were tied to the March 2026 cap season. Cap-exempt employers may still file now for eligible positions.
Texas institutions that often appear in H-1B sponsorship data
Texas sponsorship data shows that public and institutional employers remain active, even though private companies dominate total volume.
From 2020 to 2025, Cognizant Technology Solutions led Texas H-1B sponsorship with 50,666 approvals. Infosys Limited followed with 45,323 approvals. Other large sponsors included Oracle America Inc with 11,603, Tesla Inc with 5,307, and KPMG LLP with 2,677.
Public institutions also appeared among major Texas sponsors. Examples included:
- UT Southwestern Medical Center: 1,379
- Dallas Independent School District: 1,290
- Texas A&M University: 1,087
- The University of Texas at Austin: 893
Not all public employers are cap-exempt in every case. School districts, for example, are not automatically cap-exempt. The employer must fit the legal category.
What “related to” or “affiliated with” means
Many filing problems start here. A nonprofit is not cap-exempt just because it works with a university.
USCIS generally looks for a formal relationship. The nonprofit usually must show one of these:
- The university owns or controls it
- It is operated by the university
- It is attached to the university as a member, branch, cooperative, or subsidiary
- There is a written affiliation agreement, and the nonprofit’s primary purpose is to support the university’s education or research mission
A teaching hospital may qualify if it has a documented affiliation with a medical school. A private contractor serving a campus usually does not qualify.
⚠️ Employer Alert: Cap-exempt status follows the petitioning employer, not the worker. A beneficiary does not become permanently cap-exempt.
Why cap-exempt petitions are attractive
The biggest advantage is timing. A cap-exempt employer can usually file when ready, instead of waiting for March registration and an October start.
Other advantages include:
- No lottery risk
- Year-round filing
- Faster hiring for urgent academic, medical, or research roles
- Better continuity for F-1 students and researchers
- More flexibility for universities and affiliated hospitals
This matters in Texas industries tied to research and medicine. Baylor College of Medicine, UT Southwestern Medical Center, and Texas Tech University Health Sciences Center have long supported physicians, researchers, and technical staff.
Cap-exempt filing also helps in fields with strong salary growth. Texas sponsors continue to hire for specialty occupations such as software engineering, healthcare informatics, data engineering, and technical research.
Texas industries and salaries still matter in cap-exempt cases
Even when a petition is cap-exempt, the employer must still prove a specialty occupation and comply with prevailing wage rules.
Texas technology and cloud computing employers remain active, especially in Austin and Dallas-Fort Worth. IT consulting firms file at large volume statewide. Semiconductor employers are also expanding.
Examples from Texas sponsorship trends include:
- Software engineers: $110,000 to $165,000
- Data scientists: $115,000 to $170,000
- Cloud engineers or architects: $125,000 to $180,000
- AI or machine learning engineers: $130,000 to $190,000
- Cybersecurity engineers: $115,000 to $165,000
Outliers exist. A Rippling staff security engineer role in Austin reached $302,000. An Intel silicon development program manager role in Austin was about $218,059.
Employers must pay at least the higher of the actual wage or prevailing wage. Wage level still matters.
| Prevailing Wage Level | Typical Experience | USCIS Risk |
|---|---|---|
| Level I | 0-2 years | Higher scrutiny |
| Level II | 2-4 years | Moderate |
| Level III | 4-6 years | Lower if duties fit |
| Level IV | 6+ years | Lower if duties fit |
Level I wages often draw more questions, especially for broad job titles or client-site roles.
Cap-exempt vs. cap-subject H-1B
| Factor | Cap-Exempt | Cap-Subject |
|---|---|---|
| Annual limit | None | 85,000 |
| Lottery required | No | Yes |
| Filing timing | Year-round | Seasonal |
| Typical start date | After approval or status change rules | Usually October 1 |
| Employer type | Universities, qualifying nonprofits, research organizations | Most private employers |
For FY 2027, cap-subject employers followed the standard cycle. Cap-exempt employers did not need to.
What happens if the worker moves to a cap-subject employer
This is where employees get surprised.
If someone works in cap-exempt H-1B status and later moves to a cap-subject private employer, the new employer usually must obtain a cap number first. That often means entering the next lottery.
For example, a researcher at a university may hold valid H-1B status. If that person later accepts a role with Tesla Inc, Cognizant Technology Solutions, or Infosys Limited, the private employer usually cannot just file a standard transfer unless the worker was already counted against the cap.
There are limited exceptions. Each case needs a close review.
💼 Employee Tip: Ask one question before changing jobs: “Have I already been counted against the H-1B cap?” The answer affects start dates and transfer options.
Texas public-sector issue: Abbott’s freeze
Texas employers should also track state policy.
In late 2025, Governor Greg Abbott ordered a statewide freeze on new H-1B petitions across Texas agencies and public universities. That directly affected institutions such as Texas A&M University, UT Southwestern Medical Center, and The University of Texas at Austin.
This does not change federal cap-exempt law. But it may limit whether a Texas public institution is currently filing new cases.
Employees should confirm that the institution is still sponsoring new H-1B petitions before relying on an offer.
Fees and compliance points
Even cap-exempt cases carry filing costs and compliance duties.
| Fee | Amount | Required |
|---|---|---|
| I-129 Filing | $780 | Yes |
| ACWIA | $750-$1,500 | Often exempt for some nonprofits |
| Fraud Prevention | $500 | Depends on filing type |
| Premium Processing | $2,805 | No |
The employer must also file a valid Labor Condition Application and post notice as required.
⏰ Deadline: Cap-exempt employers can file year-round, but LCAs still require preparation time. Start wage review and job classification before filing.
How to verify cap-exempt status before filing
Employers should gather proof before submitting the petition. Employees should ask to see the basics.
Verification steps include:
- Confirm the employer’s legal category.
- Review nonprofit status documents, if relevant.
- Check any university affiliation agreement.
- Confirm the job supports the qualifying institution’s mission.
- Match the role to a proper SOC code.
- Confirm the offered wage meets the prevailing wage.
Employers should document the relationship clearly. Employees should not assume a hospital or contractor is cap-exempt without proof.
For Texas employers, that review is especially important where a public institution, medical center, or affiliate is involved. It is also important when moving from a university role to a private employer.
Employers should confirm cap-exempt eligibility, prepare the LCA, and review whether any Texas public-sector filing freeze applies. Employees should verify whether they have ever been counted against the cap, confirm the employer’s legal basis for cap exemption, and check that the offered salary meets the proper prevailing wage level. For FY 2027, private cap-subject filings were tied to the March 2026 season and October 1, 2026 start dates, but qualifying cap-exempt employers may still file now.
📋 Official Resources:
– H-1B Program: uscis.gov/h-1b-specialty-occupations
– Cap Season: uscis.gov/h-1b-cap-season
– Prevailing Wages: flcdatacenter.com
