By Sindhu Hariharan

Copyright thehindubusinessline

In a move to make the H1B visa regime more stringent, US President Donald Trump on Friday signed a proclamation that imposed $100,000 annual fee on H-1B visas. Companies that wish to employ foreign workers on H-1B visas must now pay the additional fee for the entry of such workers in the US.

“…The entry into the United States of aliens as nonimmigrants to perform services in a specialty occupation under section 101(a)(15)(H)(i)(b) of the INA… is restricted, except for those aliens whose petitions are accompanied or supplemented by a payment of $100,000,” the proclamation signed by Trump read. “ The Secretary of Homeland Security shall restrict decisions on petitions not accompanied by a $100,000 payment for H-1B specialty occupation workers,” it added.

Full Text: Presidential proclamations on restricting entry of certain nonimmigrant workers

Essentially, no H-1B visa holder may be able to enter the United States beginning Sunday, September 21, including current visa holders, unless they pay $1,00,000 to enter.

The order notes that the measure will ensure only “extraordinarily skilled” individuals enter the country and will discourage companies from using foreign professionals to replace American workers. “ The high numbers of relatively low-wage workers in the H-1B program undercut the integrity of the program and are detrimental to American workers’ wages and labour opportunities, especially at the entry level, in industries where such low-paid H-1B workers are concentrated,” the proclamation read.

Legal uncertainties and possible litigation

“Some organisations are already preparing litigation to challenge this travel ban,” Poorvi Chothani, Founder and Managing Partner, LawQuest, an immigration and employment law firm, said. “It will have a devastating effect on the employers who need these workers and on employees travelling to the US on H-1B visas. People currently holding an H-1B visas, but outside the U.S. should ideally fly in before September 20th to avoid this new fee [which is quite impossible],” she said. “It is important to note that H-1B workers counted under the FY2026 cap can travel to the U.S. only 10 days before the employment start date. This would be October 1, 2025,” she added.

Chothani noted that the legal fraternity is still unclear about a lot of aspects, especially around the exact process and place of payment of the fees.

Impact on Indian IT firms and US tech industry

Technology industry analysts note that the move will discourage hiring of H1-B workers for lower salaries from foreign countries but will not be too much of an adverse impact for American big tech majors or MNCs, who typically hire foreign workers for highly-skilled and higher salary roles.

“The Proclamation now ensures only very high skilled tech workforce enters through H-1B largely benefiting American Tech giants like Amazon, Microsoft, Meta, Tesla as they hire technology expert from foreign lands at much higher salaries (much beyond $60,000 levels),” Gaurav Vasu, founder of research firm UnearthInsight, said. “This would discourage mass H1B for lower tech salaries from foreign countries largely impacting Indian IT -mostly Mid to Smaller IT services- followed by Mid to small GCCs and US startups trying to hire from foreign countries,” he added.

Large Indian IT services players have, over the last 5-7 years, reduced their dependence on H-1Bs, but small and mid-sized Indian IT still depends largely on either H-1Bs or subcontractors in the US.

Video Credit: Businessline

As part of the Proclamation, the White House noted that IT firms in particular “have prominently manipulated the H-1B system, significantly harming American workers in computer-related fields.” The share of IT workers in the H-1B program grew from 32 per cent in Fiscal Year (FY) 2003 to an average of over 65 per cent in the last 5 fiscal years, it added.

Some analysts also noted that businesses will temporarily pause new H-1B filings while litigation is pending. ”Some work will shift offshore, and lobbying & lawsuits will also be ramped up,” a US-based tech analyst added.

Cognizant reviewing impact of H-1B fee order

Meanwhile US based IT major Cognizant said in a statement that it is reviewing the potential implications of the order. “At this point, we do not have details to respond accurately. Cognizant has established a resilient business model that creates flexibility to hire the best candidates for open roles, including robust local recruiting and hiring infrastructure,” a company spokesperson said.

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Published on September 20, 2025