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  • Writer's pictureMSI Marketing

How Do H-1B Visa Holders Manage A Layoff?

Updated: Aug 23, 2023

Reductions in force (RIFs) are never easy. As large multi-national companies are designing their workforce planning strategies, layoffs are trending in 2023. Layoffs can be unexpected (like Twitter/2022) or planned (like Amazon, Netflix, Salesforce, Vimeo, Goldman Sachs, and Google). Particularly hard hit is the tech industry which have a predominance of highly skilled Indian resources that rely heavily on the H-1B visa.


What is the H-1B Visa Classification

According to the USCIS (United States Citizen and Immigration Services), this nonimmigrant classification applies to individuals who wish to perform services in a specialty occupation, and services of exceptional merit and ability relating to a Department of Defense (DOD) cooperative research and development project.

While the initial uncertainty about what H-1B visa holders can do once they become part of a reduction in force (RIF), there are, in fact, several options.


Sixty-Day Grace Period

Once termination occurs, most work-related nonimmigrant workers have a 60-day grace period to look for other work or change their status prior to being required to leave the United States. This 60-day grace period change provides:

  • More time to vacate the United States.

  • An opportunity to transition to a new employer (H-1B visas are transferrable).

  • Seek guidance from an immigration attorney for the ability to change status to another nonimmigrant status (even for a brief period of time).

  • Beneficiaries of approved I-140s (the petition for a non-citizen worker to become a permanent resident) in the green card process can remain in the process while searching for a new employee.

§ Those waiting for the I-140 petition can seek U.S. employment but work outside of the U.S. while waiting to return to the U.S. once their H-1B petition is approved and receive a stamped H-1B visa from the U.S. Consulate.

§ Their current H-1B can be used in conjunction with the newly approved H-1B to return to the U.S.


Transfer of H-1B and I-140 to the New Employer

Should the terminated nonimmigrant work have an approved I-140 with his/her former employer, the new employer can file a transfer of the H-1B status, file a new labor certification, and upon employment file another I-140 petition. The priority date of the prior I-140 petition will be retained.



L-1 (Intercompany Transfer Visa) to H-1B Nonimmigrant Work Visa Transfer

If the employer has terminated an L-1 worker and wishes to file for a change of status application to H-1B within the 60-day grace period, it cannot be done – unless the worker has previously been counted under the prior H-1B cap. If the worker has not been counted in the prior cap, the employer must wait to apply for the H-1B lottery in March 2023.

The Use of ‘Garden Leave’

Garden Leave can be considered if a company terminates an employee on a certain date but has that employee remain on the payroll for a brief period of time while in non-productive work status. The official date of termination should be utilized to remain in compliance with USCIS regulations unless the worker is on medical leave or has suffered some sort of disability to work.


Maximum Length for an H-1B

The maximum length of an H-1B is six years. If the worker has been terminated and is able to find a new employer, that employer has the ability to use the remainder to time left of the total length of the visa time allotment. In certain circumstances, there may be additional extensions, but extreme caution is warranted, and immigration counsel should be sought. Examples are already approved I-140s or a pending I-485 (Application to Register Permanent Residence or Adjustment of Status).


The Future of Work

The reality of reduction in force strategies is happening at all companies today. Being able to implement and deliver a consistent message to those impacted is critical. Non-immigration workers are an important part of strategy. Knowing the options help communicate the right message of support in a trying environment.


Our Expertise

MSI’s Consulting/Advisory Team supports the design and development of global workforce and immigration strategies that align to your company values and business goals. Our focus is helping organizations optimize and develop long-range strategies for success.

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