Proposed Updates on H-1B, L-1 & B-1 (in lieu of H-1B): What You Need to Know

Amid rising H-1B fees, potential slowdowns in adjudications due to government shutdowns, and increased enforcement, a new bill regarding H-1B and L-1 visas has been introduced by Senators Grassley and Durbin. While it is not yet law, the proposed legislation could significantly impact H-1B and L-1 employers and employees.

It is uncertain whether Congress will take up the bill, but it could influence ongoing discussions on employment-based immigration policy and signal the direction of future regulations.

Below is a concise summary highlighting what stays the same and what changes under the proposed bill for both H-1B and L-1 visas.

Key H-1B Updates

Feature	Current Law	Proposed Bill
Degree Requirement	Related U.S. bachelor’s or foreign equivalent; experience + degree sometimes counts	Only a completed degree directly related to the job qualifies; work experience is no longer accepted as a substitute
Max H-1B Stay	3 years standard; renewable for another 3 years (maximum 6). Extensions beyond 6 years permitted under AC21 if a labor certification or I-140 has been pending 365+ days, or if I-140 approved but visa number unavailable	3 years standard; eligible for an additional 3 years if sponsored for permanent residence and the I-140 is approved. The bill does not affect existing AC21 provisions allowing extensions beyond six years in limited circumstances
Cap & Selection Priority	65,000 visas, 20,000 for advanced degrees annually	Same cap, but priority based on degree, STEM field, and higher wage
Wage Requirement	Must meet prevailing wage (FLAG system) or employer’s actual wage, whichever is higher	Must pay highest of local prevailing wage, median occupation wage, OEWS Level 2; LCA must describe methodology
Recruitment / Non-Displacement	Must ensure H-1B workers receive equal pay, benefits, and working conditions, avoid harming U.S. workers, and provide LCA notice with documentation	Recruitment and non-displacement statement required for all H-1B employers; post jobs on DOL website; certify no U.S. worker displacement 180 days before/after placement
Third-Party Placement	Allowed for consulting/outsourcing if there is a valid employer-employee relationship	Further restricted; DOL waiver required for placement at another employer
Enforcement & Penalties	Standard fines, investigations	Broader DHS/DOL authority, higher fines, increased whistleblower protections, annual audits
Workforce Composition	No cap. Employers with 51+ employees are considered H-1B-dependent if 15% or more are H-1B workers; lower numerical thresholds apply to smaller employers	Employers with 50 or more U.S. employees cannot have more than 50% of their workforce in H-1B or L-1 status

What This Means for Employers

• An additional three years would be available if the H-1B employee has an approved I-140. Getting an I-140 may take 3-4 years

• Higher wage obligations and detailed documentation for LCAs.

• Third-party placements and outsourcing may require additional approvals.

• Employers should review current H-1B workforce and compliance practices in advance.

Key L-1 Updates

Feature	Current Law	Proposed Bill
Wage Requirement	No specific wage rules	Must pay highest of local prevailing wage, median occupation wage, OEWS Level 2; working conditions cannot adversely affect other employees
L-1B Specialized Knowledge	Broad definition; includes proprietary knowledge, and usually requires showing that the knowledge is critical and proprietary in practice	Only for employees with proprietary knowledge that is clearly different, critical to the job, and not available in the labor market; ownership of patents/copyrights not enough unless “key person”
Non-Displacement	No formal obligation	Employers cannot replace a U.S. worker at any time with an L-1; 180-day pre/post placement rule applies
Third-Party Placement	Generally allowed for consulting/outsourcing, but practically speaking very hard to get approved	Restricted; DOL waiver required; must meet same conditions as H-1B placement rules
Blanket L Processing	Approved blanket allows faster L-1 filing internally	Employers with an approved corporate blanket L petition may receive expedited processing of individual L-1 petitions at USCIS, though the bill does not specify what this entails
New Office L-1	Must show detailed business plan, facilities, and substantial funding	Codified and strengthened: initial petition 12 months, must demonstrate systematic operations per business plan; extensions only if conditions met, DHS may grant exceptions in extraordinary cases
Workforce Composition	No cap or dependency threshold	Subject to the same 50% combined workforce cap that applies to H-1B and L-1 employees together

What This Means for Employers

• Higher wage obligations and stricter documentation for all L-1 employees.

• L-1B eligibility is now much narrower; many employees who previously qualified may no longer meet the criteria.

• Non-displacement and placement restrictions increase compliance risk, especially for third-party work or outsourcing.

• New office petitions will require more detailed planning and reporting to USCIS.

B-1 in lieu of H-1B Change

Currently, some foreign nationals who qualify for an H-1B can enter the U.S. temporarily under a special B-1 visitor status called ‘B-1 in lieu of H-1B’ to perform certain limited work

The proposed Grassley-Durbin bill would eliminate this option. After the bill, anyone who needs to work in the U.S. in an H-1B role would have to obtain an H-1B visa. They could no longer use a B-1 entry as a workaround.

We will continue to monitor developments and provide updates as the bill progresses. For questions about how this may affect your H-1B employees or pending petitions, please click here to contact us.