Proposed Updates on H-1B, L-1 & B-1 (in lieu of H-1B): What You Need to Know
- Matthew Kolodziej
- Oct 6
- 4 min read
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.