DHS Strikes Again: Proposal Would Eliminate the 60-Day Grace Period for Certain Nonimmigrant Workers

DHS has taken another step toward restricting immigration benefits by proposing the elimination of the 60-day grace period currently available to certain nonimmigrant workers following the cessation of their employment in the United States.

The proposed rule has cleared review by the Office of Management and Budget (OMB) but, as of August 31, 2026, has not yet been published in the Federal Register. Once published, it will be subject to a public comment period, typically 30 to 60 days, before DHS can consider issuing a final rule.

While all the details will not be known until publication, the proposal would effectively return the system to the pre-2017 framework, under which the loss of employment generally resulted in the immediate loss of underlying status absent another basis to remain in the United States.

Background

By way of background, a DHS regulation finalized in 2016 and effective January 17, 2017, established a discretionary grace period for certain nonimmigrant workers and their dependent family members. Under this rule, individuals in E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1, and TN status could generally remain in the United States for up to 60 consecutive days, or until the expiration of their I-94 record, whichever occurred first, following the termination of their employment. During this period, affected individuals could seek new employment, file a change or extension of status application, pursue dependent status, or make arrangements to depart the United States.

In practice, USCIS has rarely exercised its discretion to shorten or deny the grace period when adjudicating subsequent immigration filings, making it a critical safeguard for foreign nationals navigating layoffs, corporate restructurings, or other employment disruptions.

Potential Impact

Although the details of the proposal have not yet been released, eliminating the grace period could significantly restrict the flexibility that employers and foreign national workers currently have to navigate job transitions, workforce reductions, and immigration status changes.

If implemented, the proposal could have several significant consequences:

• Foreign nationals could lose an important period of authorized stay that currently provides flexibility to navigate unexpected job loss and explore alternative immigration options
• Employees would have substantially less time to secure new employment and prepare change-of-employer filings, pursue a change of status, or otherwise maintain lawful immigration status.
• Employers may face increased pressure to make hiring decisions and complete sponsorship filings on an accelerated timeline, particularly when recruiting highly skilled workers affected by layoffs or workforce restructurings 
• Employers conducting RIFS may need to reassess layoff, severance, and workforce transition practices involving sponsored employees
• Families dependent on the principal worker's status could face abrupt disruptions to their ability to remain in the United States.
• Individuals pursuing long-term immigration benefits, including employment-based permanent residence, could encounter additional status maintenance challenges that may jeopardize or delay future immigration benefits.

Looking Ahead

For employers that rely heavily on foreign national talent, the proposal could reduce flexibility during workforce transitions and increase the importance of proactive immigration planning before employment disruptions occur

At this stage, the details, scope, and implementation timeline of the proposal remain uncertain. Nevertheless, it represents another notable departure from longstanding immigration practices and reflects the Administration's continued efforts to narrow discretionary benefits available to nonimmigrant workers.

As the proposal moves through the rulemaking process, employers should consider whether participation in the public comment process may be appropriate to ensure DHS understands the potential operational and workforce implications of the proposed change

Employers and foreign nationals should closely monitor further developments and be prepared to reassess workforce planning, hiring strategies, and status-maintenance options should the proposal advance through the rulemaking process.