On September 19, 2025, President Donald J. Trump issued a proclamation that imposes a $100,000 fee on H-1B petitions for workers outside the U.S. and restricts entry unless that fee is paid. The order takes effect at 12:01 a.m. EDT on September 21, 2025, and is set to last 12 months unless extended.
This post first reviews the legal foundation and vulnerabilities of the proclamation, then turns to a Q&A and real-world case scenarios for H-1B workers and employers.
Statutory Authority Cited in the Proclamation
INA § 212(f) — 8 U.S.C. § 1182(f)
If the President finds that the entry of any aliens or class of aliens would be detrimental to U.S. interests, he may by proclamation suspend entry or impose restrictions. The Supreme Court in Trump v. Hawaii (2018) described § 212(f) as a broad delegation, giving the President sweeping power to restrict entry if he makes the requisite finding. Earlier, in Sale v. Haitian Centers Council (1993), the Court also affirmed this breadth.
Background on Trump v. Hawaii (2018)
This case arose after President Trump issued a proclamation in 2017 restricting entry for nationals of several Muslim-majority countries. The challengers argued the order violated the Constitution’s Establishment Clause because it targeted Muslims and exceeded the President’s statutory authority. The lower courts initially blocked the proclamation, but the case reached the Supreme Court.
In a 5–4 decision, the Court upheld the proclamation. The majority said that under § 212(f) of the INA, the President has very broad power to suspend or restrict entry of noncitizens if he finds their entry would be detrimental to U.S. interests. The Court stressed that it would not second-guess the President’s judgment in immigration matters, especially when framed as protecting national security.
The decision set an important precedent: as long as the President makes a formal finding of detriment and ties the restriction to entry, courts will usually defer. That’s why the travel ban survived, even though many viewed it as discriminatory.
That precedent now looms over the H-1B proclamation, shaping how courts may evaluate the $100,000 fee condition.
INA § 215(a) — 8 U.S.C. § 1185(a)
Makes it unlawful for an alien to enter or depart the U.S. except under rules, limitations, and exceptions the President may prescribe. By Executive Order 13323 (2003), DHS handles noncitizens and DOS manages passport functions, meaning both agencies implement entry restrictions.
How they work together
§ 212(f) supplies the substantive power: the President can restrict or condition entry. § 215(a) supplies the mechanism: DHS and DOS implement conditions through documentary checks, petition rules, and border adjudications.
Litigation Vulnerabilities
Unauthorized tax
Under National Cable and New England Power (1974), the Executive cannot impose revenue-raising charges untethered to a service. Immigration fees are delegated to DHS under 8 U.S.C. § 1356(m), not the President by proclamation.
Separation of powers
Congress already has a fee schedule for H-1Bs. A $100,000 levy looks like lawmaking, not enforcement.
Severability
The proclamation has no severability clause. If courts strike the $100,000 condition as unlawful, the core restriction may collapse with it.
Commerce Clause
The Commerce Clause limits the federal government’s ability to regulate interstate and international commerce unless authorized by Congress. While Congress has plenary power over immigration, the President’s authority comes only from statutes like § 212(f). Conditioning entry on payment of $100,000 could be attacked as an economic regulation of labor markets rather than a genuine immigration restriction. Plaintiffs could argue this crosses into regulating commerce without congressional authorization. However, because courts often treat immigration as distinct from commerce, and because the statute explicitly allows the President to restrict entry, a Commerce Clause argument is less likely to succeed than the unauthorized tax argument. Still, it provides another angle to show the proclamation intrudes into Congress’s Article I powers.
Why Courts May Still Uphold It?
Courts normally use the most deferential test in immigration: if the government action is rationally related to a legitimate interest, it stands. This test is easy for the government to satisfy because national security and labor market protection are legitimate interests, and any policy framed in those terms usually clears rational basis review.
Based on the Supreme Court’s decision in Trump v. Hawaii, the lower courts are more likely to side with President Trump here, because there is already a Supreme Court precedent that sustained a proclamation framed in terms of national security and economic protection.
Proclamation says “Prospective Employer”
The proclamation states: “The Department of Homeland Security and the Department of State shall coordinate to take all necessary and appropriate action to implement this proclamation and to deny entry to the United States to any H-1B nonimmigrant for whom the prospective employer has not made the payment described in section 1 of this proclamation.”
In immigration law, the “prospective employer” is generally the petitioning employer — the company that filed the H-1B petition supporting the worker’s visa or status. Even if the worker is already employed, the petition always frames the job as ongoing or future employment. That is why extensions, transfers, and amendments are also considered “prospective,” because the employer is attesting that the worker will be employed under the terms of the petition.
People may wonder whether DHS could interpret this phrase narrowly and carve out an exception for employees who are already working for a current employer, especially since the proclamation’s focus is on preventing new, lower-wage labor from entering. But as written, the language does not create such an exception. Instead, it directs DHS and DOS to deny entry if the petitioning employer has not made the $100,000 payment, regardless of whether the worker is a new hire or a long-standing employee.
What This Means for Workers Already Inside the U.S.?
The proclamation is an entry restriction, not a status restriction. Workers lawfully present in the U.S. on H-1B status are not being removed or barred from continuing to work for their employers.
But if they leave the country and attempt to re-enter, CBP and consulates are bound by this language. If their petitioning employer has not paid the $100,000, re-entry must be denied.
So while it is possible DHS may later issue guidance carving out exceptions for ongoing employees, the plain text of the proclamation does not provide that relief. For now, H-1B workers inside the U.S. should assume that any travel abroad carries a serious risk of being locked out unless their employer paid the $100,000.
How Broad Is the “National Interest” Exception?
The proclamation authorizes the Secretary of Homeland Security to waive the restriction for individuals, companies, or even entire industries if hiring H-1B workers is deemed to be in the national interest and poses no threat to U.S. security or welfare.
This could operate in a manner similar to how USCIS adjudicates National Interest Waiver (NIW) cases. In that context, petitioners must demonstrate that the proposed employment has substantial merit and national importance, that the worker is well-positioned to advance that endeavor, and that U.S. interests would be better served by granting the waiver than by denying it.
If DHS borrows from this model, employers may need to present detailed evidence of critical skills, labor shortages, or economic necessity to qualify for an exemption. As a result, the waiver process could be burdensome, evidence-heavy, and realistically limited to industries such as healthcare, advanced technology, or national defense.
Prevailing Wage Rule Making
The proclamation also directs the Department of Labor to revise prevailing wage levels for H-1Bs. This instruction means that within 4 to 5 months, employers may face sharply higher wage requirements. A position currently paying $140,000 could require $210,000 under the new rules, making many H-1B filings economically prohibitive.
While the travel restriction portion of the proclamation does not directly affect H-1B workers already inside the United States, these workers will still feel the impact once the new prevailing wage levels take effect. Employers filing transfers, extensions, or amendments will be required to meet the higher salaries.
Because the proclamation gives this rulemaking priority, new wage levels could be published in as little as 3 months. It would therefore be prudent for both employers and workers to move quickly — filing H-1B extensions or pursuing job changes sooner rather than later — to avoid being locked into higher wage requirements.
Q&A on Practical Impacts
Does this apply to H-1B workers already in the U.S.?
No. The proclamation conditions “entry” on payment. Workers in the U.S. can stay and extend status, but if they travel abroad and return, CBP could deny entry unless the $100,000 fee was paid with their petition.
What about H-1B transfers, extensions, and amendments?
These remain valid inside the U.S. The proclamation does not bar adjudications. But once travel is involved, reentry will trigger the $100,000 payment requirement.
H-1B Lottery for Students in the U.S.
For students on F-1 already in the U.S., employers can file change of status petitions to H-1B. In that case, no $100,000 fee applies, since no entry occurs. However, future lottery selection will shift to a salary-ranking model, meaning only the highest salaries are likely to be picked. That raises questions about fairness across metro areas: Silicon Valley wages may dominate.
What about F-1 students abroad?
For students outside the U.S. with consular processing, employers would have to pay $100,000 for visa issuance. The safer route is filing a change of status while the student is still in the U.S.
What about H-4 dependents?
The proclamation says nothing about H-4s. At present, it applies only to H-1Bs. However, practically, if an H-1B worker cannot enter, their H-4 family will also be stranded abroad.
Could states challenge this?
States may hesitate. Joining litigation could make them appear anti-labor. The White House has also said it consulted major companies, suggesting some industry buy-in. That complicates who will sue.
What about the travel industry?
The travel industry will feel ripple effects. Thousands of H-1B workers travel abroad for business and pleasure. Airlines may see cancellations that force entire routes to Europe, the Middle East, and Asia to be cut.
Does this only affect Indian nationals?
No. While India supplies the largest share of H-1Bs, the program includes workers from China, Europe, and elsewhere. The proclamation thus impacts global talent flows.
Could outsourcing increase?
Yes. If workers cannot enter, jobs may move overseas. But the Trump administration is also proposing an “outsourcing tax” on payments for services performed abroad, which would force companies to either pay the tax or raise U.S. salaries. The open question is whether the tech industry can adapt to hiring at much higher U.S. wage levels, given past reliance not just on cost savings but also on overseas talent pools.
The White House later clarified that the $100,000 fee is a one-time payment tied only to new H-1B petitions and will first apply in the next lottery cycle. It does not apply to renewals or to individuals who already hold H-1B status, whether they are inside the United States or traveling abroad. Current visa holders can continue to leave and re-enter as before, but employers planning new filings must prepare for the added cost once the rule takes effect. This is very confusing clarification since it goes against what is said in Proclamation. So one has to wait for update from agencies on the implementation of Proclamation.
What Employers and Workers Should Do Now
- H-1B workers should avoid travel abroad until DHS/DOS issue guidance
- Employers must prepare for the $100,000 fee for any new H-1B filings abroad
- Monitor litigation closely. Courts may enjoin the fee, but until then it is binding
- Reevaluate global hiring strategies. Outsourcing may not be viable if taxed; raising U.S. salaries may be the only option
- Stay alert for DHS/DOS guidance on fee collection, waiver standards, and consular practices
- File H-1B extensions, amendments, or transfers sooner rather than later, before new prevailing wage levels are published, since salaries required for compliance could increase dramatically within months
Bottom Line
- Do not travel. Even with valid stamping, the proclamation requires denial of entry without the fee
- Expect lawsuits. Early lawsuits seeking temporary restraining orders will almost certainly be filed, but as seen with the earlier travel ban, the proclamation may ultimately withstand challenges all the way up to the Supreme Court
- Class actions are likely. With thousands of workers and employers affected, broad litigation is expected
There has been an update on this issue. Read this:
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