Policy Watch – June 2026

The controversial $100,000 supplemental fee imposed on certain new H-1B workers remains in effect—for now.

Over the past several weeks, employers, foreign professionals, and immigration practitioners have closely followed litigation challenging the legality of the fee. While a federal court recently ruled that the government lacked authority to impose the fee, subsequent court action has allowed the government to continue collecting it pending appeal. As a result, employers should continue planning under the assumption that the fee remains fully enforceable until further notice.

Background

The $100,000 fee was introduced in late 2025 as part of broader executive actions aimed at restricting certain categories of foreign workers. The fee applies to many new H-1B petitions and has significantly increased the cost of hiring foreign talent in the United States.

From the outset, business groups, state governments, healthcare organizations, universities, and immigration advocates questioned whether the Executive Branch possessed the legal authority to impose such a substantial fee without congressional approval.

Their argument was straightforward: Congress—not the Executive Branch—has the constitutional authority to impose taxes and establish immigration filing fees. Opponents contended that the $100,000 charge was effectively a tax disguised as an immigration fee.

Federal Court Finds Fee Unlawful

On June 8, 2026, the U.S. District Court for the District of Massachusetts issued a significant decision in State of California v. Noem, concluding that the government’s implementation of the $100,000 H-1B fee was unlawful. The court found that the policy intruded upon Congress’s taxing authority and violated the Administrative Procedure Act (APA). As a result, the court ordered the underlying agency policies implementing the fee to be vacated.

The ruling appeared to provide a major victory for employers and foreign workers. Because the court’s decision was based on the APA, it carried nationwide implications and potentially would have prevented USCIS from collecting the fee altogether.

Government Appeals and Obtains Temporary Relief

Immediately after the decision was issued, the federal government announced its intention to appeal.

On June 11, 2026, the government filed a notice of appeal with the U.S. Court of Appeals for the First Circuit. The following day, government attorneys requested emergency relief, arguing that they were likely to succeed on appeal and would suffer irreparable harm if the fee collection stopped during the litigation process.

Although the district court denied the government’s request for a full stay based on the merits, it granted an administrative stay pending review by the First Circuit Court of Appeals. This administrative stay allows the government to continue collecting the $100,000 fee while the appellate court considers the matter.

As a result, the practical reality today is that the fee remains in effect.

Conflicting Court Decisions Create Uncertainty

Adding to the uncertainty is the fact that federal courts have reached different conclusions regarding the legality of the fee.

The Massachusetts decision is not the first lawsuit challenging the policy. In a separate case, Chamber of Commerce v. DHS, a federal court in Washington, D.C., previously upheld the legality of the fee. That decision is also currently on appeal.

Meanwhile, another challenge remains pending in federal court in California, creating the possibility of additional rulings in the months ahead.

What Employers Should Do Now

Despite the favorable Massachusetts ruling, employers should not assume that the fee has been eliminated.

USCIS and the Department of State continue to collect the $100,000 supplemental fee, and petitions requiring the fee should be filed with the appropriate payment unless and until the government announces otherwise.

Organizations with multiple foreign national hires may wish to explore alternative visa classifications where appropriate, including O-1 visas for individuals with extraordinary ability, TN visas for eligible Canadian and Mexican professionals, E visas for treaty investors and treaty traders, or employment-based green card strategies that may reduce long-term reliance on H-1B status.

While a federal court has now declared the fee unlawful, the government’s appeal and the administrative stay mean that the fee remains fully enforceable at this time. Additional appellate decisions are expected in the coming months and could significantly impact the future of the program.