A Department of Homeland Security (DHS) proposal published on September 11, 2026 would eliminate the 60-day grace period that currently lets H-1B, L-1, O-1 and TN visa holders stay in the country, look for a new sponsor, and stabilize their families after a layoff. The public comment period closed on November 10, 2026, drawing 31,383 submissions - an unusually high volume that reflects how deeply the rule affects both individual workers and the companies that sponsor them. This is still a proposed rule: the existing window remains in effect until DHS publishes and a final rule takes effect.

What DHS is proposing

The 60-day grace period was created by a 2016 regulation that took effect on January 17, 2017, codified at 8 CFR 214.1(l)(2). Under that regulation, H-1B, L-1, O-1 and TN visa holders, along with their dependants, may remain in the United States for up to 60 days after employment ends, or until their authorized period of admission expires, whichever comes first. DHS now argues that the grace period is not mandated by statute and generates additional administrative burden. The department's stated rationale is tighter alignment between a worker's status and the job that underpins it.

In practice, eliminating the grace period would remove the buffer that lets a laid-off worker attend interviews, assemble petition documents and file a transfer with United States Citizenship and Immigration Services (USCIS) while still physically present in the country. Under the proposed rule, termination of employment could effectively trigger an immediate obligation to depart or risk falling out of status - turning a standard layoff notice into an immigration deadline.

The numbers behind the debate

DHS's own data illustrate how central the grace period has become to the US employer-sponsorship system. The department reported that officials considered the provision in more than 1.9 million petitions and applications between October 2017 and May 2026. It further estimated that an average of 65,752 foreign workers per year lost or changed jobs between fiscal years 2021 and 2025, with roughly 3,795 per year seeing a new employer petition filed within the grace period. DHS itself acknowledged that removing the window could cause affected workers to lose income, face relocation costs or trigger immigration proceedings.

The Computer and Communications Industry Association (CCIA), a technology industry group that represents major US tech companies, submitted formal comments opposing the change. CCIA's economic analysis puts the annual net cost of elimination at between $121.5 million and $762.1 million, with a central estimate of $262.8 million. Over a ten-year horizon, that central estimate reaches nearly $1.85 billion.

Eliminating the 60-day grace period would impose high costs on employers and workers, discourage talent mobility, and make it harder for U.S. companies to recruit the specialized professionals they need to lead in critical technologies like AI and semiconductors. DHS should retain this longstanding protection rather than introduce unnecessary barriers that undermine American competitiveness.

That statement comes from Rachel Grey, Technology Policy Counsel at CCIA, in the association's formal submission to DHS. The impact would not fall evenly across nationalities. Of the 406,348 H-1B petitions approved in fiscal year 2025, approximately 70% involved beneficiaries born in India and roughly 12% involved beneficiaries born in China. Workers from those countries face the most concentrated exposure to any final rule.

For employees: mapping your options before the window closes

Consider the scenario the current regulation was designed to address. Your employer announces a reduction in force on a Monday. Under 8 CFR 214.1(l)(2), you currently have up to 60 days to attend interviews, assemble a new petition and file a transfer to a new USCIS-approved sponsor before your status is compromised. If the proposal becomes final, that runway disappears - and departure could shift from a last resort to the default outcome.

The rulemaking is outside your control. What you can do is reduce exposure while the grace period still stands:

• Confirm your authorization dates. Verify when your authorized period of admission expires and when each dependant's admission ends. That is your real window today, regardless of what any employer tells you about notice periods.
• Keep your job search ready to activate. An updated resume, current references and a shortlist of employers with active USCIS sponsorship histories all compress the gap between a termination notice and a new petition. Building that list before you need it costs far less than doing it under time pressure.
• Build a relocation reserve. DHS itself cited lost income and relocation expenses as foreseeable harms. Liquid savings covering a potential international move are a practical hedge, not a worst-case scenario.
• Understand how your severance is structured. For visa holders, the difference between a lump-sum payment and a period of continued employment on payroll can affect status in ways that do not apply to other employees. Raise the question in any salary negotiation or exit discussion, and consult an immigration attorney about how each structure interacts with your specific visa classification.
• Get legal advice before a layoff, not after. An immigration attorney can map which options apply to your classification - transfer, change of status, departure - while you still have the full 60-day window to work with.

For HR: rethinking layoff design and sponsorship under a tighter clock

For employers that sponsor nonimmigrant workers, the proposal reweights the consequences of a standard layoff decision. Under current rules, a sponsored employee who is terminated keeps a buffer measured in weeks. Under the proposed rule, the termination date itself could determine whether that person can remain in the country long enough to find another role - making layoff sequencing an immigration decision, not just an HR one.

The Society for Human Resource Management (SHRM), which represents approximately 340,000 HR professionals across the United States, has consistently flagged immigration-status risk as a gap in standard severance planning. Organizations that sponsor visas have four areas worth reviewing with immigration counsel before any final rule takes effect:

• Layoff sequencing. Identify visa-dependent staff early in any restructuring. Notice periods and termination dates set without reference to immigration status can inadvertently eliminate a worker's ability to stay in the country at all, creating liability and reputational risk alongside the human cost.
• Severance design. A period of continued employment on payroll, rather than an immediate lump-sum exit, may give visa-dependent staff a fairer transition window. That design choice belongs in the layoff playbook before a restructuring is announced, not negotiated under time pressure during an exit conversation.
• Petition speed for inbound transfers. If your organization hires visa holders who have recently been laid off elsewhere, your USCIS petition timeline becomes part of the candidate's immigration risk. A slow process could mean the candidate is required to leave the country before the offer converts to an approved petition.
• Communication protocols. Sponsored employees and their direct managers need early, clear information about how a termination affects status. Discovering a status problem on a final work day is worse for the employee and creates avoidable legal exposure for the employer.

Multinationals that move staff into US entities on L-1 intra-company transfer visas face the same exposure. An assignment that ends abruptly under the proposed rule could leave the employee with no transition time before departure is required. CCIA's finding that the change would discourage talent mobility points to a longer-term recruitment cost as well: candidates evaluating a US-based role may start pricing in the risk that a single restructuring ends their stay, and factor that into whether they accept an offer in the first place.

What happens next

With the comment period now closed, DHS must review the 31,383 submissions before it can publish a final rule. Interest built steadily toward the deadline: comment volume climbed from roughly 27,000 on November 2 to 30,382 early on Tuesday and reached 31,383 by Tuesday night. No timeline for a final rule has been announced, and the administrative review process for a proposal of this scale typically extends several months at minimum.

The H-1B grace period proposal sits inside a broader set of immigration changes currently under regulatory scrutiny. A separate proposal setting Optional Practical Training (OPT) fees at $70,000 for initial training and $30,000 for subsequent periods drew 8,947 comments. A plan to end deference to prior USCIS approvals - which would affect petition renewals across a range of visa categories - had drawn 686 comments ahead of its November 13 deadline.

Until DHS publishes a final rule and that rule takes effect, the 60-day window codified at 8 CFR 214.1(l)(2) remains in force. For visa holders, the period between now and a final decision is the right time to map your options, build your financial buffer and get legal advice on your specific classification. For HR teams and reward professionals benchmarking severance design, the months before any final decision are the moment to revise layoff protocols for sponsored staff - not the week the rule is published in the Federal Register.