By Raj Singh
When you lay off an employee you sponsor for a green card, what happens next depends on how far the case has come. An H-1B employee also has a 60-day grace period today, and DHS has proposed to remove it. This guide shows what HR should know before the conversation with the employee.
- The stage decides. Your options depend on whether the case is before the PERM, at the I-140, at the I-485, or past it. Write down where the case stands before you speak with the employee.
- The I-140. A layoff of the employee does not automatically cancel an approved I-140. A written withdrawal by the employer, or the end of the employer's business, less than 180 days after approval does (8 CFR 205.1).
- The H-1B grace period. An H-1B worker has up to 60 days after the job ends today. DHS proposed removing it on September 11, 2026, and the proposal is not final.
- 1 Write down where the case stands before you talk to the employee
- 2 How far the case has come decides what the layoff means
- 3 H-1B employees have up to 60 days today, and DHS has proposed to end that
- 4 A delayed PERM can hurt an H-1B employee near the six-year limit
- 5 Tell the employee on the same schedule as everyone else
- 6 Four answers about a sponsored employee and a layoff
- 7 Three questions the government has not answered yet
- 8 Sources
Write down where the case stands before you talk to the employee
Before you speak with a sponsored employee about a layoff, fill in a short case sheet. HR can complete most of it from the file.
- The stage: wage request, recruitment, PERM filed, PERM certified, I-140 pending, I-140 approved, or I-485 pending.
- The priority date, which sets their place in line for a green card. For PERM-based cases it is generally the date the PERM was filed. Ask counsel to confirm.
- The I-140 approval date and the I-485 filing date, if they exist.
- For H-1B employees, the maximum stay date and whether they already used a grace period in this validity period.
How far the case has come decides what the layoff means
Find the stage below. Each one has different options.
- 1Before the PERM is filed. The PERM is tied to a job offer from your company to this employee. If they leave, ask counsel what work can carry over, such as the prevailing wage determination (PWD) or the recruitment, and what you would have to redo.
- 2PERM certified, I-140 not filed yet. You have 180 calendar days after certification to file the I-140 (the immigrant petition). Mark that deadline the day the certification arrives.
- 3I-140 pending. USCIS needs proof that you can pay the offered salary from the priority date until the employee gets a green card. That proof is annual reports, federal tax returns, or audited financial statements. If you have 100 or more employees, a statement from a financial officer may be enough (8 CFR 204.5(g)(2)). Ask counsel whether the layoff changes anything.
- 4I-140 approved. A layoff of the employee does not automatically cancel an approved I-140 under 8 CFR 205.1. Two events do, if they happen less than 180 days after approval: you withdraw the I-140 in writing, or your business ends. The exception is an employee whose I-485 (green card application) has been pending for 180 days or more. Do not withdraw an I-140 without advice from immigration counsel. After a withdrawal the job offer is gone, and the employee usually needs a new petition unless they qualify for portability.
The employee can generally keep their priority date, with exceptions. The exceptions include fraud or willful misrepresentation, a revoked or invalidated labor certification, and a USCIS finding of material error (8 CFR 204.5(e)). Keeping the date does not keep the job offer. - 5I-485 pending. Some employees can change jobs while the I-485 is pending. This is called portability (INA 204(j) and 8 CFR 245.25). In general the I-485 must have been pending at least 180 days. The I-140 must be approved, or pending and later approved, and not revoked. The new job must be in the same or a similar occupation. If the I-485 has been pending fewer than 180 days, portability is not available yet. Call counsel right away.
H-1B employees have up to 60 days today, and DHS has proposed to end that
When you lay off an H-1B employee, the 60-day grace period affects how long they can stay in the United States. Many sponsored employees hold H-1B status while the green card case is pending, and that status is tied to the employer.
Under the current regulation (8 CFR 214.1(l)(2)), a worker in E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1, or TN status is not treated as out of status solely because the job ended. The grace period lasts up to 60 days, or until the authorized stay ends if that comes sooner. A worker gets one grace period per authorized validity period. DHS may shorten or eliminate it at its discretion.
The grace period does not give the worker permission to keep working. Unless they have other authorization, they may not work during it. A separate rule (8 CFR 214.2(h)(2)(i)(H)) lets an eligible H-1B worker start a new job once the new employer files a non-frivolous H-1B petition for them. Immigration counsel can tell you whether your employee is eligible.
The 60 days are available today. Do not count on them when you set separation dates. If DHS finalizes the proposal, an employee without another basis to stay could be expected to leave when work ends. We do not know whether a pending change of status or a new H-1B petition would protect them under a final rule. Suggest that affected H-1B employees talk to their own immigration counsel.
Ending H-1B employment also comes with employer steps, including notice to USCIS. Immigration counsel can list them. Our guides on the 60-day grace period and NTAs and letting go of H-1B employees cover them.
EO 14431, signed September 18, 2026 and published September 23, 2026, directs officials to consider whether an H-1B sponsor engaged in layoffs within the previous year or plans future layoffs. It does not mention PERM, labor certification, or Form I-140. Our H-1B layoffs guide covers the order in detail.
A delayed PERM can hurt an H-1B employee near the six-year limit
An H-1B employee near the six-year limit may be able to stay longer if at least 365 days have passed since a labor certification application or an I-140 was filed for them (8 CFR 214.2(h)(13)(iii)(D)). The 365 days run from the filing date. If a layoff delays the PERM filing, or a restart means a new PERM, the employee may not reach 365 days in time. Ask counsel, and check their maximum stay date with our H-1B max-out date guide before you change any filing dates. Our guide to layoffs and PERM explains how the six-month layoff rule can delay a filing.
Tell the employee on the same schedule as everyone else
Agree with your labor law counsel on when and how every affected employee is told. Sponsored employees get the same notice timing as everyone else in the group. Once an employee is told, give them a short written summary of where their case stands, and suggest they talk to their own immigration counsel.
Labor law questions go to your own labor law counsel. That includes the WARN Act, severance and release agreements, final pay, and who may see the layoff list. WayLit's partner immigration attorneys can explain how a layoff affects a sponsored employee's case and status. WayLit's case managers and software track each case's stage and keep the record your immigration counsel needs in one place.
When your company last cut jobs, did anyone write down where each sponsored employee's case stood before the conversation?
Four answers about a sponsored employee and a layoff
Yes, under the current regulation, 8 CFR 214.1(l)(2). DHS proposed removing it on September 11, 2026. Until a final rule takes effect, the current regulation applies.
Yes, in many cases. A layoff by itself does not trigger automatic revocation under 8 CFR 205.1. A written withdrawal by you, or the end of your business, less than 180 days after approval does. Ask counsel how many days have passed since your approval, and do not file a withdrawal without their advice.
Some can. Portability under INA 204(j) and 8 CFR 245.25 generally requires an I-485 pending at least 180 days, an approved I-140 (or one pending and later approved), and a new job in the same or a similar occupation. If the I-485 has been pending fewer than 180 days, portability is not available yet.
The PERM is tied to a job offer from your company to this employee, so a separation likely affects a pending case. Ask counsel what can carry over. Our guide to layoffs and PERM covers the layoff rule for other filings.
Three questions the government has not answered yet
- Whether the grace period survives. DHS has proposed removing it. We do not know when or whether a final rule will follow, or whether any transition period would apply.
- Whether a pending filing would protect the employee under a final rule. We do not know whether a pending change of status or a new H-1B petition would count as authorization to remain.
- Whether EO 14431 will reach green card cases. The order does not mention PERM. We found no agency guidance on how it applies to green card cases.
Related reading: our guide to layoffs and PERM and the green card sponsorship process.
Sources
- 8 CFR 204.5: Petitions for employment-based immigrants (paragraphs (e) and (g)(2))
- 8 CFR 245.25: Adjustment of status and job portability (2025 edition)
- 8 CFR 214.1: Requirements for admission, extension, and maintenance of status (2025 edition, paragraph (l)(2))
- 8 CFR 214.2: Special requirements for admission, extension, and maintenance of status (paragraphs (h)(2)(i)(H) and (h)(13)(iii)(D))
- Federal Register: Eliminating the Discretionary 60-Day Grace Period (proposed rule, September 11, 2026; comments due November 10, 2026)
This article is for informational purposes only and does not constitute legal advice. Consult qualified immigration counsel before making decisions about your sponsored workforce.
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