H-1B Lawsuit Update: What Employers Should Know About Exemptions, Timing, And Preparation

Will the $100,000 H-1B Fee Apply to You? 2025 Employer Action Guide

What's Happening With H-1B Visas Right Now?

After our last blog post, many readers reached out with questions about whether their petitions will be subject to the $100,000 H-1B fee announced in the September 19 proclamation. The common thread in these inquiries is a belief that there might already be clear answers about who is exempt and who is not. In reality, the entire situation remains speculative. The litigation is pending, the agencies have not provided detailed guidance, and the outcome is uncertain. Understanding the fluidity of the situation is important before making decisions about filing.

What You Need To Know Today

On September 19, 2025, a presidential proclamation proposed a $100,000 fee for certain H-1B petitions. Today's standard H-1B filing already includes multiple government fees – typically $4,000 to $6,000 before premium processing for most employers, with some paying additional statutory fees.

The September 19 proclamation is still being litigated, agencies have issued no binding guidance, and any talk of exemptions remains speculative.

The proclamation provides no standards for how the fee is to be paid or how the so-called national interest exemptions are to be granted. Employers who are H-1B cap-exempt under existing law, including colleges, universities, and "nonprofit entities affiliated with institutions of higher education," have not received confirmation that their petitions will be treated as exempt from the new requirement. For now, everyone is operating in an atmosphere of uncertainty.

If the fee is blocked, a narrow filing window may open. Expect a race to file H-1B petitions. Employers that may need to file within the next 60 to 90 days should prepare now.

Where the Litigation Stands (as of October 16, 2025)

The lead case, Global Nurse Force et al. v. Trump et al., was filed on October 3, 2025 and is pending in the Northern District of California. The plaintiffs, which include hospitals, labor unions, universities, religious nonprofits, and individual H-1B workers, are challenging the legality of the proclamation. In their complaint, they argue that the President does not have authority to impose new fees outside the statutory scheme set by Congress. As of now, the court has not ruled on the plaintiffs' request for a preliminary injunction. Until such an order is issued, the $100,000 fee remains on the books, though its application is unworkably vague.

Highlighting the widespread concern in the business community, the U.S. Chamber of Commerce filed its own lawsuit on October 16, 2025, in the District of Columbia: U.S. Chamber of Commerce v. Department of Homeland Security. In its complaint, the Chamber argues that the $100,000 fee "upends Congress's careful balance" by imposing a cost that bears no relation to administrative expenses and directly contradicts the fee schedule Congress enacted. Representing companies across all sectors, the Chamber warns that such an unprecedented surcharge would force employers, and especially startups, small businesses, and research-driven institutions, to reduce or abandon their participation in the H-1B program. The complaint stresses that this loss of access to global talent would not only harm individual businesses but also cede competitive advantage to foreign rivals and suppress broader job creation in the United States.

What a Court Injunction Would Trigger

If the courts block the fee, even temporarily, you should expect an immediate surge in H-1B filings, especially from these categories:

1. H-1B change-of-employer petitions filed year-round.
2. Cap-exempt filings by colleges, universities, and qualified nonprofit entities.
3. H-1B petitions for individuals already counted against the cap in the past, who still have unused time within the six-year limit (including recapture) and hold some other nonimmigrant status.

Waiting for perfect clarity during policy transitions is how employers miss these windows.

The Impact of the Government Shutdown

Complicating matters further is the current federal government shutdown, which is now in its third week. This is not just a background political issue. It has a direct and immediate effect on employers because the Department of Labor is not processing or certifying Labor Condition Applications (LCAs). A certified LCA is a mandatory prerequisite to filing any H-1B petition. Without it, even employers who are otherwise ready to file cannot proceed.

Past shutdowns have shown how disruptive a shutdown can be. During the 2013 and 2018 to 2019 shutdowns, LCA certifications stalled, leading to backlogs and delayed filings. Employers that waited until the last moment to prepare found themselves unable to act when the government reopened. In the current environment, where a preliminary injunction could create only a narrow filing window, a prolonged shutdown magnifies the risk. If the Department of Labor remains closed, employers will not be able to take advantage of an injunction even if the court temporarily blocks the $100,000 fee requirement.

This means that readiness is not only about legal eligibility but also about timing. Employers who have prepared their petitions will be in a far stronger position than those who wait. In contrast, those caught mid-process may lose their chance to file if the shutdown continues into the period when a preliminary injunction is in effect.

Essential Preparation Steps: Do These Things Now

Whether you are a startup or a multinational, the following steps are non-negotiable.

1. Scope roles and wage levels. Confirm specialty occupation criteria and wage determinations match the actual job.

2. Validate the employer-employee relationship. Prepare third-party placement documentation if applicable (itineraries, end-client letters).

3. Prove work availability. Assemble statements of work, project plans, and proof of physical premises for the requested validity period.

4. Collect beneficiary credentials. Gather degrees, official transcripts, and foreign credential evaluations. Order evaluations now since they could take days to obtain.

5. Draft forms and support letters now. Complete Form I-129 and support letters that detail position descriptions, beneficiary qualifications, and company background.

6. Pre-review public access files. Ensure they will be complete when the LCA certifies (certified LCA, notice, actual wage, summary of benefits).

7. Build two parallel timelines. One for "injunction window opens" and one for "no relief plus fee risk," with clear ownership for each step.

Are H-1B Cap-Exempt Employers (Universities and Nonprofits) Exempt from the $100,000 Fee?

One of the most common questions we are getting is whether university and nonprofit employers are exempt from the $100,000 fee? Our best answer is that as of October 17, 2025, it's unknown. Here is why.

What we know: cap-exempt institutions under section 214(g)(5) of the Immigration and Nationality Act – institutions of higher education, related or affiliated nonprofit entities, nonprofit research organizations, and governmental research organizations – are exempt from annual H-1B cap numerical limits and have historically received different treatment on prevailing wages.

What is unclear: the September 19 proclamation does not explicitly address cap-exempt employers. The text, as clarified in a USCIS FAQ, applies broadly to "any new H-1B visa petitions" without carving out employer categories. Until USCIS issues implementing guidance or a court order clarifies scope, the applicability of the surcharge to cap-exempt petitioners remains ambiguous.

What we are monitoring: filings from university and industry plaintiffs and the U.S. Chamber of Commerce that could produce judicial clarity, and any USCIS policy guidance distinguishing cap-exempt filings.

Conservative approach: assume you might face the fee and prepare to file during any injunction window. We will update this guidance promptly when official clarification emerges.

Real-World Scenario: How This Affects a University

Situation: A large public university brings in 20–30 international professors, researchers, and specialized staff each year to sustain academic programs and research initiatives. In Q4 2025, it has five signed offers that require new H-1B petitions.

Risk: If a court allows the proclamation to take effect and the university is not exempted, each petition could trigger a $100,000 surcharge in addition to the existing government fees. This would strain departmental budgets, delay course offerings or research projects, and risk losing candidates who cannot wait for the institution to resolve funding questions.

Action Plan:

• Prepare all five petitions in advance with complete documentation, holding only the Labor Condition Applications (LCAs) until filing.
• Stagger LCA requests to minimize Department of Labor processing bottlenecks.
• Assign a designated staff member to track the federal court docket daily.
• Provide executive leadership with updated budget scenarios that include potential surcharge exposure.

Illustrative Cost Structure:

• For a standard employer using premium processing, current government fees total about $6,185 before attorney costs:
  • $780 I-129 base filing fee
  • $600 Asylum Program fee
  • $500 anti-fraud fee
  • $1,500 ACWIA fee
  • $2,805 premium processing fee (optional)
• Some employers also owe a $4,000 fee under Public Law 114-113 if the employer has 50 or more U.S. employees and more than half of them are in H-1B status.
• If the proclamation applies, add $100,000 per petition to the above.

FAQ: The Questions We Are Getting From Employers

What Happens Next: Three Plausible Paths

1. Court grants a preliminary injunction
   A temporary injunction would pause the proclamation. This would open a filing window under the current fee structure, giving prepared employers a chance to file immediately.
2. Court denies relief and the fee takes effect
   If the courts do not intervene, the $100,000 surcharge would apply. Employers will need to reassess the economics of each hire, adjust budgets, and possibly delay or withdraw offers.
3. Policy shifts through settlement, guidance, or legislation
   The litigation or political process could produce a different outcome altogether, such as modified fees, new exemptions, or a revised timeline. Employers should be ready to pivot quickly.

The Bottom Line
No matter which path emerges, the only controllable factor today is preparation. Employers that assemble complete filings now will be positioned to act decisively once the outcome is clear.