(UNITED STATES) The White House has proposed a sweeping set of new limits on the H-1B program, moving quickly after unveiling a $100,000 fee on many new petitions filed for workers outside the country starting September 21, 2025. Filed under a draft rule titled “Reforming the H-1B Nonimmigrant Visa Classification Program,” the plan would tighten who qualifies for H-1B, narrow exemptions, and increase scrutiny of companies that place workers at client sites.
The combined moves mark the most aggressive H-1B reform push in years and could reshape how high-skilled foreign talent enters the United States. Indian professionals and U.S. tech employers are among the groups likely to be most affected.
Stricter “Specialty Occupation” Definition
At the center of the proposal is a stricter definition of “specialty occupation.” Under current practice, H-1B roles can be approved when there is a broad link between the job and the worker’s degree. The new rule would require that the degree field be directly and specifically tied to the job duties.
- Jobs that rely on flexible or interdisciplinary degrees may no longer qualify.
- Positions blending multiple fields (e.g., computer science with business, or data analysis with biology) risk being excluded under the tighter test.
Cap Exemptions Revisited
The Department of Homeland Security also wants to revisit cap exemptions long used by universities, nonprofit research bodies, and certain healthcare and government research organizations.
- These institutions can often sponsor H-1B workers outside the annual cap and lottery (65,000 regular slots plus 20,000 for U.S. master’s degree holders).
- The proposal signals fewer institutions may qualify for cap-exempt status, potentially pushing some schools and research labs into the crowded H-1B lottery.
Consequences:
– Some universities and research hospitals could face greater hiring unpredictability.
– Institutions may pivot toward internal transfers (L-1) or slow international hiring.
Third-Party Placements and Oversight
A major change targets third-party placements—commonly used by consulting and IT firms that place H-1B workers at client sites.
- The draft rule would tighten oversight of these arrangements and could limit or disallow some subcontracting setups.
- Employers should expect more audits, documentation requests, and site visits if they rely on client-site placements.
Recommended employer actions:
– Rework contracts to clarify supervision and control.
– Increase in-house staffing or consider offshoring to reduce compliance risk.
Enhanced Compliance and Enforcement
The administration is seeking tougher compliance checks.
- Companies with past wage or labor violations could face heightened review, extra penalties, or even disqualification from sponsoring.
- Even employers with clean records are advised to strengthen internal controls, ensure accurate wage levels, and keep thorough records, especially for roles with travel or complex reporting lines.
Constraints on Alternative Pathways
The draft signals a desire to restrict routes sometimes used to work around H-1B limits, such as O-1A (extraordinary ability) or green card routes like the National Interest Waiver.
- While these routes remain lawful, the policy intent is to reduce backdoor strategies and push more high-skilled hiring into a tighter H-1B framework.
The $100,000 Fee: Key Details
The fee change is the most eye-catching single item.
- The $100,000 fee would apply to new H-1B petitions filed on or after September 21, 2025 for beneficiaries outside the United States at the time of filing.
- Exemptions: Extensions, amendments, changes of status inside the United States, and existing H-1B holders would not trigger the fee.
Implications:
– A first-time petition for a worker abroad could become dramatically more expensive.
– Employers may prefer candidates already in the U.S. to avoid the fee.
Potential Shift in Visa Allocation
The draft also points to a change in how visas are allocated.
- Rather than a random draw, the government may favor petitions with higher wages or higher skill levels.
- If adopted, this could:
- Reward employers willing to pay more for specialized roles.
- Squeeze entry-level positions that historically relied on lottery randomness.
Analysis: Who’s Most Affected
For Indian professionals:
– The tightened specialty occupation test could cut off routes that rely on broader degree-to-duty matches in software, analytics, and data roles.
– Jobs that previously fit with interdisciplinary degrees may fail the new standard.
For employers:
– Legal and operational risk will rise.
– Firms may need to audit past cases, close record gaps, and rework vendor chains.
– Hiring strategies could tilt toward L-1 internal transfers or offshore teams to avoid higher fees and compliance burdens.
For universities, nonprofits, and research labs:
– Narrowed cap exemptions may force some to enter the lottery or reduce international hiring.
– Departments with tight budgets could struggle to absorb higher fees, affecting recruitment timelines and budgets.
Practical Steps for Employers and Applicants
Recommended actions now:
- Rebuild job descriptions so duties align directly with degree fields.
- Review wage levels and confirm that Labor Condition Application details match real duties and worksites.
- For client-site models, establish clear contracts, control mechanisms, and documentation to show employer direction, pay, and supervision.
- Consider backup visa strategies:
- L-1 for intracompany transfers
- O-1 for those with qualifying achievements
- Monitor rulemaking and prepare to submit public comments during the comment window.
Important: Stakeholders should watch the public comment window closely. Comments can challenge definitions, suggest alternatives, or request adjustments to timelines and enforcement. The final rule could change based on public input.
Summary of Policy Changes (At-a-Glance)
- Specialty occupation tightened: Degree field must directly match job duties; interdisciplinary links may fail.
- Cap exemptions under review: Fewer nonprofits, universities, and research bodies may qualify.
- Third-party placements restricted: Added scrutiny for client-site work, with stricter auditing and potential limits.
- Employer compliance expanded: Past violations may lead to higher penalties and sponsor disqualification.
- Alternative routes constrained: Use of O-1A and National Interest Waiver may be limited where viewed as workarounds.
- Visa allocation shift: Possible move from random lottery to prioritizing higher wages or skill levels.
- $100,000 fee: Applies to new petitions for beneficiaries outside the U.S. filed on or after September 21, 2025; extensions and in-country changes of status are exempt.
Timeline and Next Steps
- The proposal is advancing through the federal rulemaking process.
- Agencies will review public comments and may revise the draft before a final rule takes effect.
- Employers should plan now but stay flexible in case the final text adjusts definitions, enforcement, or timelines.
If the $100,000 fee is retained as written, employers filing for workers abroad on or after September 21, 2025 must budget for it. If allocation moves away from the lottery, prepare earlier for wage-level preparations tied to job categories.
For official background on H-1B requirements and employer duties, refer to the USCIS H‑1B program page: https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations. It remains the government’s primary reference while the rulemaking advances.
Final Takeaway
The stakes are high. If the draft becomes final in its current or similar form, the H-1B system will likely tilt toward fewer, higher-paid roles with clear degree ties, tighter employer controls, and reduced reliance on third-party staffing. The $100,000 fee introduces a significant cost shock for first-time hires abroad, nudging companies to favor in-country candidates or alternative visa strategies. For many applicants and firms, these proposals represent not just policy shifts but career and business decisions that will shape where work happens and who gets access to the U.S. labor market.
This Article in a Nutshell
The White House’s draft rule proposes broad changes to the H-1B program, including a $100,000 fee for new petitions filed abroad starting September 21, 2025, a narrower definition of “specialty occupation” requiring direct alignment between degree field and job duties, and reduced cap-exempt status for some universities, nonprofits, and research institutions. The proposal increases scrutiny of third-party placements, raises compliance and enforcement measures against employers with violations, and hints at allocating visas by wage or skill level rather than by lottery. Affected parties—especially Indian professionals and U.S. tech employers—should update job descriptions, bolster documentation, consider alternative visas (L-1, O-1), and monitor the public comment period for potential changes.
