U.S. Immigration Alerts

FGI UPDATE: This Week’s Summary of U.S. Immigration News

US Immigration Updates 

Department of Homeland Security Replaces H-1B Lottery with a Wage-Weighted Selection System

The Department of Homeland Security (DHS) recently announced a final rule that fundamentally changes how H-1B work visas are awarded. Instead of using a random lottery, DHS will now use a wage-weighted selection system that favors higher-paid, higher-skilled foreign workers. The rule is intended to better protect American workers’ wages and job opportunities while reducing abuse of the H-1B program by employers seeking lower-cost labor. The regulation will be published on December 29, 2025, takes effect on February 27, 2026, and will apply to the Fiscal Year (FY) 2027 H-1B cap registration season.

Key Points

• Weighted Selection Replaces the Lottery: The random H-1B lottery is eliminated and replaced with a weighted selection process. Registrations are now prioritized based on the Occupational Employment and Wage Statistics (OEWS) wage level assigned to the position.
• Wage Levels Determine Selection Weight: Registrations at Wage Level IV are entered into the selection pool four times, Level III three times, Level II two times, and Level I one time. This structure increases the probability that higher-paid positions are selected.
• Unique Beneficiary Counting: Each unique beneficiary is counted only once toward the annual numerical cap, regardless of how many registrations are submitted or how many times the registration is entered into the pool. This measure aims to limit manipulation of the system through mass filings.
• Statutory Visa Limits Remain: The annual cap of 65,000 H-1B visas remains unchanged, along with an additional 20,000 visas for U.S. advanced degree holders. The rule alters selection mechanics, not the total number of visas available.
• Reduced Reliance on Entry-Level Workers: DHS has acknowledged that the new system will make it significantly less likely that employers will hire international students at graduation, particularly for lower-wage, entry-level roles.

What U.S. Employers Need to Know

• Higher Wages Increase Selection Odds: Employers offering higher wages tied to higher OEWS levels will have a substantially better chance of selection. Compensation strategy now plays a central role in H-1B planning.
• Lower-Wage Roles Face Steeper Odds: While employers may still register candidates at all wage levels, Level I and II positions are less likely to be selected. This disproportionately affects junior roles and recent graduates.
• Compliance and Scrutiny Will Increase: DHS has emphasized that the previous lottery system was exploited by employers seeking lower-paid foreign labor. Employers should expect heightened enforcement and closer review of wage and skill claims. Perceived irregularities or later filings to lower wage levels could lead to the issuance of notices of intent to revoke or deny, requests for evidence, etc. 
• Cost of H-1B Employment Is Rising: The weighted selection rule aligns with other recent reforms, including a Presidential Proclamation requiring employers to pay an additional $100,000 per visa. Together, these changes significantly raise the cost of using the H-1B program.
• Strategic Workforce Planning Is Essential: Employers must reassess whether H-1B sponsorship aligns with their long-term talent needs, budgets, and compensation structures. Advance planning will be critical for FY 2027 and beyond.

Looking Ahead

• Shift Toward Senior Talent: The new system is likely to favor experienced professionals in specialized or leadership roles. Employers may increasingly reserve H-1B sponsorship for senior or highly specialized positions.
• Impact on International Students: Fewer international graduates may transition directly from U.S. universities to H-1B status, especially in lower-paid entry-level roles. This could reshape campus recruiting and early-career hiring strategies.
• Potential Legal and Policy Challenges: As with past H-1B reforms, the weighted system may face legal scrutiny or future policy revisions. Employers should monitor developments closely.
• Broader Immigration Reform Momentum: DHS has signaled that this rule is part of a broader effort to strengthen the integrity of the H-1B program. Additional regulatory changes may follow.
• Changing Talent Pipelines: Over time, employers may look more aggressively to alternative visa categories or offshore hiring to compensate for reduced access to entry-level H-1B workers.

DHS’s new wage-weighted H-1B selection rule marks one of the most significant changes to the program in decades. By prioritizing higher-paid, higher-skilled workers and moving away from a random lottery, the administration aims to curb abuse and better protect American workers. While the rule preserves access to H-1B visas at all wage levels, it fundamentally alters employer strategy, increases costs, and reduces opportunities for entry-level foreign talent. As the FY 2027 registration season approaches, employers must adapt quickly to this new reality and rethink how—and whether—they use the H-1B program.

SOURCES: USCIS Newsroom: www.uscis.gov/newsroom/news-releases/dhs-changes-process-for-awarding-h-1b-work-visas-to-better-protect-american-workers; Federal Register: www.federalregister.gov/documents/2025/12/29/2025-23853/weighted-selection-process-for-registrants-and-petitioners-seeking-to-file-cap-subject-h-1b 

D.C. Federal Court Upholds $100,000 H-1B Fee; States File Legal Challenges

On December 23, 2025, a federal district court judge in Washington, D.C. rejected a legal challenge against the Presidential Proclamation that imposes a $100,000 fee on certain H-1B visa petitions. The decision was in response to a lawsuit that the U.S. Chamber of Commerce and the Association of American Universities filed that challenged the Proclamation’s legality, questioning the Trump Administration’s authority to levy the fee. The court had ruled that the Proclamation falls within the President’s authority under U.S. immigration law, allowing the fee to remain in effect for now. Two additional lawsuits are pending. The first is a lawsuit brought by a coalition of immigration advocacy organizations and affected employers filed in October in the U.S. District Court for the Northern District of California. The second lawsuit was filed by a coalition of 20 states in the U.S. District Court for the District of Massachusetts in December. These U.S. states argue that the fee would severely restrict access to skilled foreign workers, particularly for nonprofits, schools, and public institutions that cannot afford such a high cost. The plaintiffs are asking the California court to temporarily block it while the legal challenge proceeds.

Key Points

• Court Upholds the Proclamation: The D.C. federal district court ruled that the $100,000 H-1B fee is lawful. The judge found that the President acted within his authority under Section 212(f) of the Immigration and Nationality Act.
• Challenge by Major Business Groups: The lawsuit was brought by the U.S. Chamber of Commerce and the Association of American Universities. They argued that the Proclamation exceeded presidential authority and harmed U.S. employers and institutions.
• Legal Challenge to the Fee: The lawsuit seeks to stop enforcement of a new $100,000 fee for new H-1B visa applicants. Plaintiffs argue that the policy exceeds executive authority and imposes unreasonable financial barriers.
• States Support the Plaintiffs: Attorneys general from more than 20 states and the District of Columbia signed onto an amicus brief supporting the challenge. Their involvement signals broad concern about the policy’s nationwide impact.
• Impact on Nonprofits and Schools: The brief emphasizes that nonprofits, universities, hospitals, and schools would be disproportionately harmed. Many of these institutions rely on H-1B workers but lack the budgets to absorb such a high fee.
• Conflicting Court Decisions: Although the Northern District of California is being asked to block the fee, another court has already upheld it. This split increases the likelihood of prolonged litigation.
• Fee Remains in Effect: Because the Proclamation was upheld, the $100,000 fee continues to apply while appeals and other lawsuits proceed. Employers must comply unless future court orders say otherwise.

What U.S. Employers Need to Know

• Who Is Subject to the Fee: The Proclamation applies to certain H-1B petitions filed after September 20, 2025, that require consular notification. Employers must pay $100,000 per affected employee unless an exception applies.
• Limited Exceptions Available: Employers may avoid the fee only if granted a national interest exception or if the employee is otherwise exempt. These exceptions are expected to be narrow.
• Immediate Compliance Required: With the court upholding the rule, employers must continue paying the fee for covered cases. Failure to do so could result in petition denials.
• Significant Cost Increase: The $100,000 fee represents a dramatic increase in the cost of sponsoring new H-1B workers. Employers must reassess whether sponsorship is financially viable.
• Uneven Impact Across Sectors: Large, well-funded employers may be able to absorb the fee, while nonprofits and schools may be priced out entirely. This could reshape hiring patterns across industries.
• Strategic Planning Is Essential: Employers should consider alternative visa categories or workforce strategies. Contingency planning will be critical as litigation continues.

Looking Ahead

• Appeals Process Continues: The case will now move to the D.C. Circuit Court of Appeals. A reversal or modification remains possible.
• Potential for Rapid Policy Changes: Court orders or agency guidance could be issued with little notice. Employers may need to act quickly to adjust filing strategies.
• Broader Impact on Business and Education: If the fee survives all challenges, it may permanently reshape how employers, universities, and research institutions use the H-1B program. Smaller and nonprofit employers may be most affected.
• Long-Term Legal Resolution Uncertain: With multiple cases moving through the courts, a final nationwide resolution may take months or longer. Continued litigation is likely.
• Employer Adaptation: Companies and institutions may increasingly shift hiring abroad or invest more heavily in domestic training. This could alter long-term workforce development strategies.
• Ongoing State Involvement: The large number of states involved suggests sustained political and legal opposition. Additional lawsuits or legislative responses are possible.

The D.C. district court’s decision to uphold the $100,000 H-1B fee marks a major development in the administration’s effort to reshape employment-based immigration. While the ruling confirms broad presidential authority under immigration law, it does not end the legal fight. The multistate challenge to the $100,000 H-1B fee highlights growing concern over the cost and accessibility of skilled immigration pathways. While the Trump administration argues the fee protects American workers, states contend it unfairly excludes nonprofits, schools, and other public institutions from hiring qualified talent. With courts divided and litigation ongoing, employers face continued uncertainty. The outcome of Global Nurse Force v. Trump could play a major role in shaping the future affordability and structure of the H-1B program.

SOURCES: Newsgram.com: www.newsgram.com/america/2025/12/24/us-states-unite-to-block-trumps-100000-fee-on-h-1b-visas; storage.courtlistener.com/recap/gov.uscourts.dcd.285953/gov.uscourts.dcd.285953.54.0.pdf

USCIS End-of-Year Review Highlights Sweeping Immigration Enforcement and Policy Changes

In its end-of-year review released on December 22, 2025, U.S. Citizenship and Immigration Services (USCIS) detailed a broad set of immigration enforcement actions and policy reforms implemented under the leadership of Secretary of Homeland Security Kristi Noem and USCIS Director Joseph Edlow. The agency describes 2025 as a year focused on restoring order, integrity, and national security to the immigration system through stricter vetting, expanded enforcement authority, aggressive fraud detection, and regulatory changes designed to prioritize American workers and communities. USCIS framed these efforts as an “America First” approach intended to reverse policies of the prior administration and place national interest at the center of immigration decision-making.

Key Points

• Expanded Vetting and National Security Measures: USCIS significantly enhanced screening and vetting protocols for immigration benefits. New policies require officers to consider country-specific risk factors, especially for applicants from 19 presidentially designated high-risk countries.
• Creation of a New Vetting Center: On December 5, USCIS announced a new vetting center focused on identifying terrorists, criminal aliens, and other public safety threats. The center will use advanced technology and coordinate closely with law enforcement and intelligence agencies.
• Increased Enforcement Actions: Since January 20, USCIS has referred more than 14,400 aliens to Immigration and Customs Enforcement (ICE) for public safety, fraud, and national security concerns. These efforts have resulted in over 2,400 arrests at USCIS field offices.
• Revived Enforcement Authority for USCIS Officers: USCIS officers are again issuing Notices to Appear in removal proceedings in large numbers. Approximately 196,600 Notices to Appear have been issued since January 20.
• Hiring of “Homeland Defenders”: USCIS launched a historic hiring initiative to strengthen enforcement and fraud prevention. More than 50,000 applications were received, and the first Homeland Defenders began work in December 2025.

What U.S. Employers Need to Know

• Aggressive Fraud Investigations: USCIS has made over 29,000 fraud referrals to its Fraud Detection and National Security Directorate since January 20. Employers should expect heightened scrutiny of employment-based petitions, including H-1B filings.
• Operation Twin Shield Enforcement: USCIS conducted its largest enforcement operation to date, uncovering fraud involving marriage-based cases, H-1B visas, and student visas. The operation led to benefit denials, Notices to Appear, and ICE arrests.
• Employment Authorization Changes: USCIS eliminated automatic extensions of work authorization in certain categories. Employers must ensure employees have valid, current authorization before continuing employment.
• Shorter EAD Validity Periods: The agency reduced the maximum validity of some employment authorization documents from five years to 18 months. This change increases re-vetting frequency and compliance obligations for employers.
• Higher Costs and Tighter Controls: USCIS is implementing new fees under the One Big Beautiful Bill Act and supporting DHS rules prioritizing higher-paid, higher-skilled H-1B workers. These changes increase costs and reduce flexibility for employers relying on foreign labor.

Looking Ahead

• Continued Focus on Enforcement: USCIS leadership has made clear that immigration enforcement will remain central to the agency’s mission. Additional policy tightening and enforcement initiatives are likely.
• Reduced Access to Humanitarian Programs: The administration is ending or restricting programs such as Temporary Protected Status and broad humanitarian parole. Future relief will be granted on a narrower, case-by-case basis.
• Stricter Naturalization Standards: USCIS has revised the naturalization test to make it more rigorous and resumed neighborhood investigations. Applicants will face more intensive evaluation of eligibility and moral character.
• Expanded Use of Data and Technology: SAVE system enhancements and large-scale verification efforts suggest greater use of data analytics in immigration and election-related integrity checks. This trend is expected to continue.
• Long-Term Program Restructuring: DHS has signaled ongoing reforms to employment-based and agricultural visa programs. These changes aim to balance economic needs with enforcement priorities.

USCIS’s 2025 end-of-year review reflects a dramatic shift toward enforcement-driven immigration policy focused on national security, fraud prevention, and protecting American workers. Through expanded vetting, revived enforcement powers, aggressive fraud investigations, and sweeping regulatory changes, the agency has redefined its role as both a benefits adjudicator and an enforcement body. While supporters view these actions as restoring integrity and accountability, the changes significantly raise compliance burdens for employers and immigrants alike. As DHS signals that further reforms are coming, the long-term structure and accessibility of the U.S. immigration system are likely to continue evolving.

SOURCE: USCIS Newsroom: www.uscis.gov/newsroom/news-releases/making-america-safe-again-us-citizenship-and-immigration-services-end-of-year-review-demonstrates

NFAP Policy Brief December 2025: Significant Decline in Foreign Born Workers

Recent government data analyzed by the National Foundation for American Policy (NFAP) shows a steep and statistically significant decline in the number of foreign-born workers in the United States since the start of the Trump administration in January 2025. Despite expectations from federal agencies that immigration would increase the labor force, the opposite has occurred, with more than one million foreign-born workers leaving the labor market. Importantly, the data shows no clear evidence that U.S.-born workers have benefited from this decline, raising concerns about long-term economic growth, labor shortages, and the broader impact of restrictive immigration policies.

Key Points

• Large Drop in Foreign-Born Employment: The Bureau of Labor Statistics household survey shows 1.1 million fewer foreign-born workers since January 2025 and 1.5 million fewer since a peak in March 2025. This decline contrasts sharply with historical trends of steady annual growth in the foreign-born labor force.
• Statistically Significant Trend: Four consecutive monthly estimates show declines of more than one million foreign-born workers compared to January 2025. The consistency of these estimates suggests the decline is real, despite normal survey errors.
• Mismatch With Government Projections: The Congressional Budget Office and Social Security Administration assumed more than 2 million net immigrants would arrive in 2025, implying 1.3 million additional workers. Instead, the labor force has shrunk, contradicting these projections.
• Survey Limitations and Data Distortions: Economists note that the BLS survey may overestimate both U.S.-born and foreign-born employment when large-scale emigration occurs mid-year. This could mean the actual loss of foreign-born workers is even larger than reported.
• Decline Likely to Continue: NFAP concludes that ongoing immigration restrictions and perceptions of a less welcoming environment are likely driving continued emigration. The decline is not limited to undocumented immigrants but affects visa holders as well.

What U.S. Employers Need to Know

• No Evidence of a U.S.-Born Worker Rebound: Unemployment among U.S.-born workers rose from 3.9% in November 2024 to 4.3% in November 2025. Labor force participation among U.S.-born workers remained flat, showing no surge of Americans filling vacated roles.
• Tighter Labor Markets Ahead: The loss of foreign-born workers reduces the available labor pool, particularly in industries that rely heavily on immigrant labor. Employers may face increased difficulty filling open positions.
• Questionable Employment Gains: While BLS data shows a 2.7 million increase in U.S.-born employment since January 2025, economists argue this figure is implausibly high. Population growth estimates do not support such a large increase.
• Increased Hiring Uncertainty: Employers should be cautious when relying on headline employment data. Structural labor shortages may be masked by survey limitations.
• Strategic Workforce Planning Needed: With fewer workers entering the labor force, employers may need to invest more in retention, automation, or alternative talent pipelines.

Looking Ahead

• Significant Long-Term Economic Impact: NFAP estimates Trump administration immigration policies could reduce the U.S. workforce by 6.8 million workers by 2028 and 15.7 million by 2035. This would substantially slow economic growth and lower living standards.
• Massive Productivity Losses Projected: Reduced immigration could result in a loss of 19 million worker-years by 2028 and 102 million worker-years by 2035. These losses translate into trillions of dollars in reduced economic output.
• GDP Reductions Forecasted: NFAP estimates GDP losses of $1.9 trillion from 2025 to 2028 and $12.1 trillion from 2025 to 2035. On a per-person basis, this equals thousands of dollars in lost economic output.
• New Proclamations Will Deepen the Decline: A December 16 proclamation restricts immigrant and temporary visa entry from 39 countries and sharply limits refugee admissions. These measures will further reduce legal immigration.
• Broad Impact on Families, Employers, and Universities: Restrictions affect U.S. citizens sponsoring relatives, employers seeking skilled workers, and universities enrolling international students. The cumulative effect will reshape legal immigration pathways.

The sharp decline in foreign-born workers since early 2025 represents a major shift in the U.S. labor market with far-reaching consequences. Data shows that fewer immigrants have not led to improved outcomes for U.S.-born workers, while employers face tighter labor conditions and the economy risks slower growth. With new proclamations further restricting legal immigration and refugee admissions, NFAP projects substantial long-term losses in workforce size, productivity, and GDP. As immigration policy continues to tighten, its economic ripple effects are likely to intensify across industries and communities nationwide.

SOURCE: nfap.com/research/nfap-policy-brief-u-s-labor-force-analysis-for-november-2025/