DHS Overhauls H-1B Process to Protect American Workers

A sweeping change to the H-1B program in the United States 🇺🇸 is set to hit employers and visa applicants in two waves, starting with a September 19, 2025, Presidential Proclamation that conditions many new H-1B cases on a $100,000 payment, followed by a planned shift away from the traditional random lottery toward a wage- and skill-weighted selection system for the next cap cycle.

What the proclamation does and when it takes effect

The proclamation, issued on September 19 and titled “Restriction on Entry of Certain Nonimmigrant Workers,” takes effect September 21, 2025. It sharply raises the price of bringing certain H-1B workers to the country through visa processing abroad. The administration framed the move as targeting alleged abuse of the program — claiming some employers use H-1B hiring to replace U.S. workers at lower pay and push down wages in STEM jobs, with both economic and national security implications.

Under the proclamation:
– H-1B visa issuance for specialty occupations is restricted unless the petition is accompanied by a $100,000 payment per petition, subject to exemptions described below.
– The measure is time-limited, set to expire 12 months from the effective date — on September 21, 2026, at 12:01 a.m. EDT, unless extended.

Which filings trigger the $100,000 payment

The payment primarily targets filings that involve consular processing or other overseas visa issuance steps rather than cases completed entirely inside the U.S. According to DHS/USCIS, it applies to new H-1B petitions filed after September 21, 2025 that request:
– consular notification, or
– port-of-entry notification, or
– pre-flight inspection.

It can also apply when a change or extension of status is rejected, leaving the worker to seek an H-1B visa abroad. For global workers outside the U.S. who do not already hold H-1B status, the proclamation functions less like an administrative tweak and more like a new price of entry.

Key exemptions to the payment

USCIS clarified that the $100,000 payment is not universal. Exemptions include:
– Beneficiaries who already hold a valid H-1B visa or status.
– Petitions filed before September 21, 2025.
– Approved changes, extensions, or amendments of status, even if filed after that date (including cases where the worker later travels for visa stamping abroad).
– Discretionary exemptions where the DHS Secretary may allow national-interest cases that “do not threaten U.S. security or welfare.”

These carve-outs create two practical tracks:
– Workers already inside the U.S. in H-1B status (processing via extensions/amendments in-country) often avoid the fee.
– First-time H-1B hires abroad, or workers forced into consular processing after a status denial, may become much more expensive to hire.

Administration rationale and example cited

DHS, through USCIS, says the proclamation is intended to curb “program abuse” and “better protect American workers.” The agency highlighted an example to illustrate the behavior it seeks to deter:
– An IT firm approved for 1,700 H-1B workers in FY 2025 laid off 2,400 American workers in Oregon in July 2025.

That anecdote has become a focal point in debates over whether the H-1B system enables cost-cutting labor strategies rather than truly specialized hiring.

Second wave: wage- and skill-weighted selection system (February 27, 2026)

The proclamation is only the first wave. The second is planned for February 27, 2026, when DHS intends to replace the random H-1B lottery with a “weighted system” for the FY 2027 cap season.

Cap totals remain unchanged:
– 65,000 H-1Bs for the regular cap
– 20,000 for U.S. advanced degree holders

What changes is how winners are chosen when demand exceeds supply. Under the proposed approach:
– Selection would be weighted so that petitions offering wages at or above the median for the relevant skill level (based on Occupational Employment Statistics) receive a higher probability of selection.
– The goal is to select the “best of the best”, boost U.S. competitiveness, and discourage lower-wage hiring that the agency argues can undercut U.S. workers.

USCIS spokesman Matthew Tragesser summarized the logic: the weighted approach “counters exploitation of [the] random lottery,” reflecting the view that a blind draw can reward employers offering the lowest permissible pay just as readily as those making high-end offers.

Practical impacts for employers and workers

For employers, the combined effect of a possible six-figure charge on many overseas-processed cases and the wage-weighted selection mechanism alters risk pricing:

• Companies that relied on volume and randomness (many registrations hoping a lottery hit) may now face:
  • Fewer selections if offers cluster at lower wage levels.
  • Much higher costs when the worker requires consular issuance.
• Firms that recruit heavily overseas — including large outsourcing firms — are widely seen as especially exposed.
• The source material specifically notes Indian IT firms face higher costs and lower odds under the combined changes.

For workers:
– A higher wage offer is not only better for pay but could increase the chance of selection.
– Policy shifts can result in canceled start dates, broken leases, delayed family plans, or withdrawn job offers when employers tighten budgets.

Criticisms, supporters, and wider context

Supporters claim the changes better align the H-1B program with its original purpose — serving specialty occupations and protecting U.S. workers.

Critics (employers, industry groups) warn:
– Steep charges and wage-tied selection rules could squeeze startups, university partners, and businesses in lower-cost regions, even when jobs are genuinely specialized.
– The source material does not include direct quotes from critics or a point-by-point DHS rebuttal, but such concerns are expected as implementation details are finalized.

The proclamation arrives amid “America First” framing under President Trump, and as of December 2025 no extension or reversal has been reported. Timing matters for hiring plans: the proclamation’s fee applies based on filing dates and processing types, while the weighted selection is tied to the cap season beginning in late February 2026. Employers recruiting on annual cycles may need to consider accelerating filings, redesigning wage offers, or shifting focus to workers processable via in-country extensions/amendments.

Possible further changes and related legislation

DHS signaled additional tightening could follow. The source material mentions potential moves such as:
– Higher prevailing wages
– Stricter specialty occupation definitions

It also references ideas from the proposed H-1B and L-1 Visa Reform Act of 2025, including:
– Tiered approvals based on education and wage
– Longer non-displacement windows
– Job posting periods and audits
– Higher penalties

These are described as related proposals, not enacted measures, and no dates or final texts were provided.

Practical guidance and next steps

DHS’s clearest practical advice: keep checking official updates. There has been no USCIS/DHS rulemaking yet on the proclamation because the fee is implemented directly through the proclamation’s authority. DHS/USCIS points readers to agency postings and guidance on the H-1B program at USCIS.

According to analysis by VisaVerge.com, the combination of a short-fuse fee rule and a later weighted selection shift is designed to change employer behavior quickly — especially for high-volume filers that rely on lower-cost labor strategies — while leaving cap numbers unchanged.

Key takeaway: the new mix of a Presidential Proclamation and a wage-weighted selection system will make wage level and worker location (inside vs. outside the U.S.) more decisive than ever in who gets selected and what it costs to bring them to the U.S.

If you rely on H-1B hiring, consider:
1. Reviewing whether hires can be processed via in-country extensions/amendments to avoid the fee.
2. Re-evaluating wage offers to improve weighted-selection odds.
3. Monitoring USCIS/DHS announcements closely for implementation guidance and any extensions or changes.