H-1B Fee Hike by Trump Challenged in Court

The U.S. Chamber of Commerce announced Thursday that it is suing the Trump administration to block the addition of a $100,000 fee on new petitions for H-1B visas, which the Chamber argues is both unlawful and misguided.

The fee also faces a separate challenge by the American Association of University Professors and a coalition of labor unions, healthcare providers, schools, and religious organizations, which sued the administration earlier this month, arguing the new fee has “already thrown employers, workers, and federal agencies into chaos.”

Both the Chamber and the AAUP lawsuits aim to block President Donald Trump’s Sept. 19 proclamation modifying the H-1B program — the avenue through which many skilled workers from abroad are hired in the U.S.

Both lawsuits argue that the administration’s sudden decision to impose the extra fee — which went into effect on Sept. 21 — is unlawful under the Immigration and Nationality Act and the Administrative Procedure Act. “The H-1B program has a carefully crafted fee and oversight system set by law. The president cannot rewrite it overnight or levy new taxes by proclamation,” the AAUP lawsuit says.

Neil Bradley, executive vice president and chief policy officer at the Chamber, said in a press release that the new fee would make it cost-prohibitive for U.S. employers to access global talent.

“The president has said he wants to educate, attract, and retain the world’s best and brightest in the U.S., and the Chamber shares that goal,” Bradley said.

The White House says the new fee is necessary to counter abuse of the H-1B visa program, and to improve the job market for American workers. “The H-1B nonimmigrant visa program was created to bring temporary workers into the United States to perform additive, high-skilled functions, but it has been deliberately exploited to replace, rather than supplement, American workers with lower-paid, lower-skilled labor,” the proclamation states. It also argues abuses of the program threaten national security by depressing wages and “discouraging Americans from pursuing careers in science and technology.”

U.S. Citizenship and Immigration Services estimated in 2019 that there were more than 600,000 H-1B workers in the U.S. The program allows companies to hire up to 65,000 workers annually, with an additional 20,000 spots for workers with advanced degrees from U.S. universities. Non-profit research institutions, universities, and government research organizations are not subject to these caps.

Fees for all H-1B employers

The $100,000 fee applies both to businesses looking to hire international talent as well as non-profit research institutions.

Although non-profit organizations such as universities and federal labs are exempted from H-1B worker caps, the administration has given no indication that these organizations will likewise be exempt from the new fees. An analysis of federal data conducted by Inside Higher Ed suggests that U.S. colleges and universities secured approval for more than 16,000 new H-1B employees in fiscal year 2025, with 930 institutions employing at least one H-1B visa holder.

The proclamation indicates that the government may waive fees on request under a national interest clause, but these requests will be considered by the Department of Homeland Security on a case-by-case basis. The AAUP lawsuit describes this offer as “vague” with “no clear standards for fee exemptions, opening the door to arbitrary, pay-to-play decisions.”

The AAUP lawsuit also describes the administration’s decision to set the fee at $100,000 as “arbitrary and capricious” arguing that it is “untethered from the cost of adjudicating H-1B petitions or any other petitions” — a sentiment that is echoed in the Chamber’s lawsuit. Previously, H-1B petition processing fees were typically a few thousand dollars.

“When the government makes it prohibitively expensive or impossible for these professionals to come to America, or for current H-1B workers to transition to a more permanent status, universities and entire communities lose — patients wait longer for care, students have fewer teachers, and local economies miss out on the innovation and jobs these experts create,” AAUP wrote in a press release.

Some of AAUP’s members have already been affected by the policy change, with the group’s lawsuit citing a case where a university indefinitely paused the pursuit of an H-1B visa for a professor because of the new fee.

Meanwhile, some Republicans in Congress have made clear they do not think universities should receive special treatment when it comes to hiring foreign talent. In July, Sen. Tom Cotton (R-AK) introduced a bill proposing to take away universities’ cap-exempt status, with a companion bill introduced in the House by Reps. Thomas Tiffany (R-WI) and Andrew Clyde (R-GA). In September, Cotton introduced a broader bill that would close other “loopholes” in the H-1B system.

“Colleges and universities shouldn’t get special treatment for bringing in woke and anti-American professors from around the world. My bill closes these loopholes that universities have abused for far too long,” Cotton said in a statement.

Wider impacts for foreign talent

Though the H-1B program is for skilled foreign workers, the new fee could also deter international students from pursuing study in the U.S., wrote Lindsay Milliken, associate director of public policy research and analysis at the American Institute of Physics, in an analysis of the visa policy change. (AIP’s research team is separate from FYI.)

“International students in the U.S. on F-1 visas are often interested in transitioning on to H-1Bs after the completion of their academic programs,” Milliken wrote. “This expense may cause international students in the physical sciences to lose their employment opportunities and research organizations to be unable to afford to hire international STEM graduates of U.S. universities.”

While media coverage of the new H-1B fees has largely focused on how it will affect big tech companies, advocacy groups focused on research and innovation are also starting to voice concern that visa program changes will hinder the ability of the U.S. to attract and retain talented people from abroad.

Compete America, a coalition representing corporations, universities, research institutions, and trade associations looking to reform immigration policies for skilled workers, urged the Trump administration to reverse course.

“Policies that artificially inflate costs or drive away investment from our country do not protect American workers; they limit opportunities for U.S. job growth, shrink our economy, and cede the future to our competitors abroad,” Compete America said in a statement.