Policy Update · Proposed September 11, 2026 · JBNP Law
If you are in the United States on an E-2, L-1, H-1B, O-1 or TN and your job ends, you currently get up to 60 days to find something new without falling out of status. DHS wants to take that away. The proposal is open for comment until November 10.
On September 11, DHS published a notice of proposed rulemaking to remove 8 CFR 214.1(l)(2) — the regulation that created the up-to-60-day discretionary grace period after employment ends. The grace period has been in place since January 2017, when it arrived as part of the AC21 rule.
DHS now says that was a mistake. Its position is that the grace period disconnects a person’s lawful status from the very basis of their eligibility, and that administering it adds avoidable burden for USCIS officers.
The proposal covers E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1 and TN holders — and their dependents. Written comments are due by November 10, 2026, under DHS Docket No. USCIS-2026-0364.
Right now, if your qualifying employment ends, you are not treated as having failed to maintain status for up to 60 days, or until your authorized stay expires, whichever comes first. That window is what lets a new employer file a change-of-employer petition, or lets you file to change to another status, without a gap opening up underneath you.
Remove it and the rule reverts to what applied before 2017: the day after your qualifying employment or activity ends, you are out of status and expected to depart immediately. Being out of status makes you removable under INA 237(a)(1)(C). It also generally means you cannot extend your stay or change status from inside the country — so the fix becomes leaving, getting a new petition approved, and applying for admission from abroad.
DHS does not dispute the impact. Its own analysis acknowledges that some affected workers may lose income, that some would be issued Notices to Appear — that is, placed in removal proceedings — and that referrals to the immigration courts would rise.
E-2 treaty investors and their employees. E-2 status is tied to the specific enterprise you were approved to develop and direct. If the business closes, or you stop directing it, there is no 60-day runway to restructure, sell, or regroup.
L-1 transferees. The L-1 is tied to the qualifying relationship with the employer. A layoff, a reorganization that ends that relationship, or a terminated assignment would leave no cushion at all.
Dependents. Spouses and children in E-2, L-2 and H-4 status lose status at the same moment the principal does. E and L spouses with work authorization lose the basis for it too.
First, the important part: this is a proposed rule, not law. It is not in effect. Nothing about your status changed on September 11, and you should not act as though the grace period is already gone.
For E-2 and L-1 clients, we are moving contingency planning to the front of new filings and extensions rather than leaving it until something breaks — securing the longest validity periods available, and being clear in advance about what the exit looks like if the business or the assignment ends. If your employment looks unsettled over the next year, that is a conversation worth having now, while the 60 days still exists.
We are also flagging the comment period, because it is the one point of leverage anyone has here. Workers and employers can comment through regulations.gov before November 10. Comments citing specific facts and real numbers carry considerably more weight than form letters, and the comment record is also what any later legal challenge would be built on.
There is no way to know yet whether a final rule will arrive, when, or in what shape. We will post again when it moves.
This post is general information, current as of when it was written — not legal advice, and no substitute for talking to an attorney about your own case. This area is changing quickly, and reading this doesn’t make us your lawyers. Please get advice on your specific situation before you act.