United States: DHS Proposes Eliminating Discretionary 60-Day Nonimmigrant Grace Period

The discretionary, maximum 60-day grace period was created by regulation in 2016 and took effect in early 2017. Under the rule, E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1 and TN nonimmigrants (and their dependents) who are granted the grace period are not considered to have failed to maintain nonimmigrant status solely because the principal’s employment ceased. The maximum duration of the grace period is the shorter of 60 days or until the principal’s I-94 expiration date. It is available once during each authorized petition validity period. DHS has the discretion to shorten or refuse to accord the grace period but rarely did so until recent months, with grace period refusals becoming more common.

The grace period was instituted to mitigate the negative immigration consequences of employment loss. It allows affected individuals to seek other employment in the same nonimmigrant category or change status without the need to depart the United States, or to prepare for departure. The grace period applies whether the employment cessation is voluntary or involuntary.

If the rule is finalized, it will mean that nonimmigrants whose employment has ceased before the end of their period of stay would need to depart the United States immediately, unless they have separate authorization to remain. In its proposal, DHS acknowledges that if the grace period regulation is eliminated, some affected foreign nationals could be issued Notices to Appear (NTA), the government’s first step in initiating removal (deportation) proceedings. The prospect of NTA issuance may be likelier for those in nonimmigrant categories that require an employer to immediately notify the government when employment of the foreign national has ceased, including H-1B, O-1, and P.  Department of Labor regulations and policies also require USCIS notification to end Labor Condition Application (LCA) wage obligations related to H-1B, H-1B1, and E-3 employment termination.

The proposal does not have immediate impact on employers or foreign nationals. It will not take effect until DHS reviews the public feedback received over the 60-day comment period and publishes a final regulation with a specific implementation date.

The views of employers will be important to advise DHS about the impact of the proposal on the business community. Fragomen’s Government Strategies Group is available to assist organizations interested in submitting comments.