Changes to the H-1B visa and their consequences for US hiring and secondment practices

President Trump’s administration has introduced two significant changes to the highly popular H-1B visa program for skilled workers: The previous random lottery will be replaced by a salary-based selection process. And: The US will impose an additional one-time fee of $100,000 for certain H-1B applications. The changes will have a significant impact on employers who want to hire and second their non-US skilled workers in the US. Employers should review their US hiring and secondment practices if necessary and consider alternatives to the H-1B visa.

What is the H-1B visa for skilled workers?

Introduced in 1990, the H-1B visa program for skilled workers is a US non-immigrant visa category that allows US companies to employ highly qualified foreign workers for up to six years in specialty occupations in the US. Under certain circumstances, additional extensions are possible. A specialty occupation is one that typically requires at least a bachelor’s degree or equivalent professional experience in the relevant field. Common specialty occupations include engineers, nurses, accountants, university professors, etc.

Since the visa is flexible in terms of the types of professions eligible and is suitable for longer-term assignments, it is very popular with US employers to leverage when there are no qualified candidates available domestically. However, only 85,000 new H-1B visas are issued each year, of which 20,000 are reserved for candidates with at least a master’s degree from a US university. Demand for new H-1B visas greatly exceeds supply, which results in an annual lottery that determines which employers can proceed in filing new H-1B petitions for which candidates.

First change: H-1B lottery reform

Historically, the lottery was based on a random selection process to give all registered candidates equal opportunity of selection, regardless of their position, salary, or experience. Now, candidates with higher salaries are to be given priority.

The idea is that those that employers wish to hire into higher paying roles are more skilled than those in lower paying roles.

In general, the US government groups similar positions into broad occupational categories and divides them into four “wage levels.” Entry-level positions typically fall under wage levels 1 and 2, while positions that require more experience are usually assigned to wage levels 3 and 4. Wage levels are adjusted annually and vary depending on the position and geographic location. Under the new rules, applicants entered into the lottery for a wage level 4 position will be entered into the lottery 4 times, applicants for level 3 positions, 3 times, and so on. This change not only affects the selection probability of registered candidates but also requires employers to determine the occupational classification and wage level of the position in question before registering their candidate into the lottery.

The US government believes that this change will help fill important positions in industries such as technology and healthcare with the most qualified candidates. However, it will likely disadvantage recent graduates and those just starting their careers.

Second change: H-1B fee of $100,000

On September 19, 2025, President Trump announced a new additional fee of $100,000 for H-1B applications, which will be added to the existing H-1B application fees. After considerable uncertainty among employers and their H-1B employees about exactly which H-1B applications would be subject to this new additional fee, the U.S. Citizenship and Immigration Service (USCIS) issued guidance on October 20, 2025. According to this guidance, the fee applies only to H-1B applications filed on or after September 21, 2025, and are approved as consular notifications. This means that the fee does not apply to H-1B applications filed on or after September 21 and approved as changes or extensions of status within the United States. H-1B applications for which employers request a change or extension within the United States but are approved by USCIS as consular notifications will be subject to the $100,000 fee.

Cases subject to the $100,000 fee:

• H-1B petitions that request consular notification because the prospective employee is outside the United States
• H-1B applications that request consular notification because the employee is not eligible for a change of status or extension within the United States

Cases not subject to the $100,000 fee:

• H-1B applications to extend an employee’s existing H-1B status within the United States
• H-1B applications for simultaneous extension and amendment of status
• H-1B applications involving a change of status within the United States from another non-immigrant category to H-1B

The Trump administration justifies the fee by citing the high number of H-1B applicants and approvals, claiming it contributes to unemployment among American citizens, especially young college graduates aged 22 to 27. By imposing higher costs on companies that employ non-US workers, the administration hopes to encourage companies to hire local US workers and only recruit highly skilled foreign professionals.

At the time of publication, two lawsuits challenging the legality of the $100,000 fee are pending in US courts. However, the lawsuits do not have a suspensive effect. This means that the US can continue to impose the fee, at least until a court decision ordering otherwise has been issued.

Alternatives to the H-1B visa

For many employers, paying the $100,000 fee is not affordable, even for their most qualified employees and applicants. Therefore, US employers of non-US workers should consider which employees they would like to hire on an H-1B visa or whether alternative forms of work authorization in the US are an option, such as E-1/2, L-1, or O-1.