The proclamation underpinning the fee, which Trump signed on 19 September, conditions the entry of certain H-1B workers on employers paying the new charge. The administration presents the measure as an effort to curb abuse and protect domestic wages; opponents argue it undermines the H-1B framework established by Congress and jeopardises U. S. innovation and workforce stability.
Among the plaintiffs are the United Auto Workers union, the American Association of University Professors, religious groups and health care staffing firms. They argue that only Congress may impose new fees or taxes, and accuse the administration of sidestepping the Administrative Procedure Act by implementing the rule without notice and comment. The complaint asserts the proclamation is “unprecedented, unjustified and unlawful,” stressing that no prior president has unilaterally imposed such a sweeping charge across the market.
The litigation comes amid confusion over who will bear the burden. Under the proclamation’s language, the fee will apply to new petitions filed after 21 September, including those tied to the FY 2027 lottery. Multiple agencies—U. S. Citizenship and Immigration Services, Customs and Border Protection, and the State Department—have issued guidance interpreting the rule. Some memos limit it to non-citizens outside the United States, and others attempt to exempt current visa holders from its reach.
The American Immigration Council notes that the abrupt policy has provoked chaos among employers, particularly smaller entities and educational institutions, which may find the fee unaffordable. The organisation highlights uncertainty over application in cases such as change-of-status filings, renewals, and exemptions under national interest criteria.
In parallel, bipartisan legislation has been reintroduced in the Senate aiming to reform the H-1B and L-1 visa programs. Senators Chuck Grassley and Dick Durbin propose measures including stricter wage requirements, mandatory public job postings, and limits on visa eligibility. That bill responds to long-standing concerns about visa abuse, and now gains urgency in light of the heightened cost regime.
Technology giants such as Amazon, Microsoft and Google have scrambled to advise H-1B employees who are abroad to return to the United States before restrictions take effect. Internal memos warn that re-entry could be blocked under the new visa regime. Even though the White House later sought to clarify that holders of valid H-1B visas will not be subject to the fee, the guidance has been incomplete and inconsistent, prompting concern in highly skilled sectors.
The government has defended the overhaul as a lawful exercise of executive authority under sections of the Immigration and Nationality Act that allow the president to restrict entry. Administration officials argue that the fee will discourage frivolous visa filings and ensure that only top-tier talent qualifies. Critics counter that the change threatens U. S. competitiveness, undermining sectors that depend on global talent.
Legal analysts note the case might hinge on separation of powers and the limits of executive authority. The plaintiffs’ argument that only Congress may enact a sweeping fee aligns with constitutional principles about taxing power. Meanwhile, the administration’s claim of broad discretionary power over immigration invites scrutiny of how much control a president may exert without legislative backing.