Federal Court Strikes Down the $100,000 H-1B Fee: What It Means for Employers and Employees Right Now

On June 8, 2026, a federal judge in Boston vacated the $100,000 H-1B fee that President Trump imposed by executive proclamation in September 2025. The ruling is effective immediately and applies nationwide. If your company has been sitting on an H-1B petition because of that fee, or if you are a foreign national whose employer could not afford to file one on your behalf, the legal landscape changed yesterday.

How the $100,000 Fee Came About

On September 19, 2025, President Trump signed Presidential Proclamation 10973, which added a $100,000 supplemental payment requirement to H-1B petitions filed on behalf of foreign workers outside the United States. The stated rationale was to address what the administration described as systemic abuse of the H-1B program, specifically its use to replace American workers with lower-cost foreign labor in technology and STEM fields.

The fee took effect on September 21, 2025. Almost overnight, it transformed the economics of H-1B hiring. Before the proclamation, the total cost of filing an H-1B petition ranged from approximately $960 to $7,595 in statutory and regulatory fees. The $100,000 requirement added a cost that was, for many employers, larger than the annual salary they were paying the worker they sought to hire.

The practical consequences were immediate and severe. Many employers, particularly small and mid-sized businesses, nonprofits, universities, and healthcare providers, simply stopped filing H-1B petitions for workers outside the United States. By February 2026, USCIS had received only 85 payments of the $100,000 fee, generating $8.5 million in total revenue. The program, which historically processes tens of thousands of new petitions each year, had been effectively shut down for a large segment of the employer community.

What the Court Decided and Why

U.S. District Judge Leo T. Sorokin of the District of Massachusetts ruled in favor of a coalition of 20 states led by California, which sued on the grounds that the proclamation violated the separation of powers and the Administrative Procedure Act. The court granted summary judgment to the states on all four of their claims and vacated the policy in its entirety.

The core of the ruling is straightforward: the $100,000 payment is a tax, and under the U.S. Constitution, only Congress has the power to impose taxes. The President does not. The court found that the INA provisions the administration relied on, specifically Sections 212(f) and 215(a), authorize the President to impose restrictions on the entry of noncitizens, but that the word “restrictions” does not include the power to tax. The court drew directly on the Supreme Court’s 2026 decision in Learning Resources v. Trump, which reached the same constitutional conclusion in the context of executive tariffs imposed under the IEEPA.

Beyond the constitutional issue, the court found three additional, independent grounds for vacating the policy:

• No notice-and-comment rulemaking. The agencies implemented the fee through internal memoranda, FAQ documents, and website updates, none of which went through the public notice-and-comment process required by the APA for legislative rules. The court rejected the government’s arguments that the foreign-affairs exception or the good-cause exception applied.
• Excess of statutory authority. Neither INA Section 212(f), Section 215(a), nor any other statutory provision granted the agencies authority to impose a $100,000 tax on H-1B petitions. The court found the policy was simply beyond what the law allows.
• Arbitrary and capricious. The agencies failed to provide any reasoned explanation for the fee, failed to consider the reliance interests of employers who had built their hiring plans around the existing cost structure, and failed to address the impact on sectors like healthcare and education that the proclamation’s own rationale never mentioned.

What This Means for Employers and H-1B Workers

This ruling matters differently depending on where you sit in the H-1B process. Here is how we are advising clients to think about it.

For employers who paused or canceled H-1B filings because of the fee: the legal barrier that stopped you from filing is now gone. The standard fee structure that was in place before September 21, 2025 applies again. If you have workers outside the United States who are waiting on H-1B petitions, those cases can now be evaluated and, where appropriate, filed under the original cost structure.

For foreign nationals waiting abroad: if your employer had an approved or approvable H-1B petition but could not proceed because of the $100,000 fee, your situation has changed. You should contact your employer and your immigration counsel promptly to assess next steps. Be aware that cap-subject petitions are still subject to the annual lottery cycle, so timing and cap availability will depend on the specifics of your case.

For employers who paid the $100,000 fee: the ruling vacates the policy but does not automatically provide for refunds. The question of what, if anything, employers who paid the fee are entitled to recover is not addressed in the decision and will likely require separate legal action. We are monitoring this issue closely.

For H-1B workers already in the United States on extensions, transfers, or changes of status: the $100,000 fee was not broadly applied to those categories of petitions from the outset. If your petition was processed domestically through a change of status or extension, you were likely not subject to the fee to begin with, and this ruling does not directly change your situation.

The Broader Context: A Pattern of Executive Overreach Findings

This ruling does not exist in isolation. It is the latest in a series of federal court decisions finding that the executive branch has exceeded its authority in implementing immigration and trade policy through proclamations and internal agency directives rather than through the statutory and regulatory processes that Congress established.

Three days earlier, on June 5, 2026, a federal court in Rhode Island vacated four separate USCIS policies that had frozen green card, asylum, work permit, and naturalization applications for nationals of 39 countries. The legal analysis in that ruling, which we wrote about separately, rested on the same foundational principle: agencies must act within the authority Congress gave them and must provide genuine, reasoned justifications for their decisions.

The Massachusetts court also drew expressly on the Supreme Court’s 2026 Learning Resources decision, which struck down executive tariffs under IEEPA on identical constitutional grounds. That case established that the power to tax, whether on goods or on visa petitions, belongs to Congress, not the President, and cannot be implied from broad statutory language authorizing the executive to impose “restrictions” or “regulations.”

Taken together, these decisions reflect a federal judiciary that is willing to apply structural constitutional limits to executive immigration action, even in an environment where national security and immigration enforcement arguments have historically commanded significant judicial deference.

An Appeal Is Expected. Here Is What That Means.

The administration has consistently and aggressively appealed adverse rulings in immigration cases, and this ruling is no exception. An appeal to the U.S. Court of Appeals for the First Circuit is widely expected. The government may also seek a stay of the ruling pending appeal, which would suspend the vacatur and potentially reinstate the $100,000 fee while the appeal is litigated.

Whether a stay is granted depends on whether the First Circuit finds that the government has a likelihood of success on the merits, that it would suffer irreparable harm without a stay, and that the balance of equities and public interest favor staying the ruling. Given the strength of the constitutional analysis, rooted in a Supreme Court precedent decided just months ago, a stay is not a foregone conclusion. But it cannot be ruled out.

There is also the question of Congressional action. The administration could work with Congress to enact the $100,000 fee through legislation, which would be constitutionally permissible. Whether and how quickly Congress might pursue that path is uncertain.

The practical guidance for employers and workers right now is this: the ruling is effective and the fee is vacated as of June 8, 2026. You may proceed on that basis. But given the realistic possibility of a stay or appellate reversal, major business decisions, including relocating workers, restructuring hiring plans, or making commitments that depend on the fee remaining vacated, should be made with counsel and with an understanding of the legal uncertainty that remains.

A Note on the Broader H-1B Environment

Employers and foreign nationals should understand that while the $100,000 fee is gone for now, the rest of the current H-1B environment remains challenging. USCIS continues to issue Requests for Evidence at elevated rates. The agency’s May 2026 policy memorandum reframing adjustment of status as extraordinary discretionary relief adds uncertainty for workers seeking to convert from H-1B status to permanent residence. And the administration’s broader immigration enforcement posture means that procedural compliance, documentation, and the quality of H-1B petitions matters more than ever.

Yesterday’s ruling removes one significant obstacle. It does not change the fact that H-1B practice in 2026 requires careful, experienced legal guidance at every step.

Parandian Law advises employers and foreign nationals on H-1B petitions, employment-based immigration, and all aspects of U.S. immigration law. We are monitoring this ruling and its aftermath in real time and are available to advise clients on how to respond.

Questions About H-1B Petitions or This Ruling? Contact Us.

If you have a pending immigration case that has been stalled due to a USCIS hold, or if you have questions about how this ruling may affect your situation, contact us to schedule a consultation.

If you have questions about how these developments affect your specific situation, contact our White Plains office at (914) 793-2626 or click the link below for a consultation.