The Trump administration plans to reform the H-1B visa program by implementing additional restrictions for employers and modifying the criteria for cap exemptions.
The upcoming rule titled ‘Reforming the H-1B Nonimmigrant Visa Classification Program’ posted on the Federal Register shows the action date as August 2026. It was initially posted last year with the action date as December 2025.
What The Rule Proposes
The full details have still not been announced, but the rule abstract states that the Department of Homeland Security (DHS) will propose to reform the H-1B program by revising eligibility for cap exemptions, providing greater scrutiny for employers that have violated program requirements, and increasing oversight over third party placements, among other provisions. These changes are intended to improve the integrity of the H-1B nonimmigrant program and better protect U.S. workers’ wages and working conditions.
The three focus areas will be: Cap exempt category, US employers and third party placements.
Cap Exempt Category
The H-1B visa system permits US employers to hire foreign workers who are specialized and qualified enough for the job, based on the worker’s specialized knowledge and academic credentials.
The Immigration Act of 1990 established a 65,000 annual limit on new H-1B petitions. In 2004, Congress raised the H-1B annual limit to 85,000 by exempting 20,000 individuals a year who earned a master’s degree or higher from a U.S. university. In total, the H-1B visa cap category allows 85,000 visas to be issued to foreigners annually.
However, that doesn’t mean only 85,000 H-1B visa holders from abroad can join US employers each year. There are additional cap-exempt visas also available. Certain employers, such as institutions of higher education, non-profit organizations like hospitals, K-12 schools affiliated with higher education, non-profit research organizations, and government research organizations, are exempt from the annual numerical cap on visas.
Cap-exempt employers are not required to register or participate in the annual lottery, and can file petitions directly without being restricted to a specific cycle. The proposed revamp of the H-1B visa program aims to address concerns in the eligibility for cap exemptions.
Violations of US Employers Under The Scanner
The proposed rule also aims to address fraud and abuse in the H-1B visa program by providing greater scrutiny for employers that have violated program requirements. Some indicators of H-1B fraud include: non-payment of certified wages, wage disparities disadvantaging U.S. workers, H-1B workers not performing specified duties, less experience compared to U.S. counterparts, and discrepancies in the work location compared to the Labor Condition Application (LCA).
Third Party Placements To Face More Oversight
DHS has an existing rule stating that if an H-1B worker will be staffed to a third party, meaning they will be contracted to fill a position in the third party’s organization, the work to be performed by the beneficiary for the third party must be in a specialty occupation. It is the requirements of that third party, not the petitioner, that are most relevant when determining whether the position is a specialty occupation. Once the new rule is implemented, expect an increase in the scrutiny of third party placements.
Disclaimer: This article is for informational purposes only and does not constitute legal or immigration advice. The rule discussed here has not yet been finalized, and details are subject to change once formally published. Readers should consult official DHS/USCIS sources or a qualified immigration attorney before making decisions based on this content. Financial Express is not responsible for any decisions made based on this information.