On September 19, 2025, the White House unveiled a US$100,000 fee on new H-1B petitions—an abrupt surcharge on top of steep fee increases rolled out over the past 18 months. Within days, the U.S. Chamber of Commerce sued to block the move, arguing the executive branch overstepped and warned of harm to U.S. competitiveness. Whatever the litigation’s outcome, the shock is immediate: employers must recalibrate hiring models, international graduates face new friction, and Canada—particularly Montreal and Toronto—looks increasingly attractive as a hedge.
The US$100,000 surcharge lands on top of a year of already-higher immigration costs. In April 2024, USCI raised the base filing fee for H-1B petitions (Form I-129) to US$780 and introduced an “Asylum Program Fee” of US$600 for most large employers (US$300 for small employers; $0 for nonprofits). In February 2024, premium processing rose to US$2,805, and beginning with the FY 2026 lottery, the H-1B registration fee jumps from US$10 to US$215. In parallel, the DHS finalized a “beneficiary-centric” lottery that gives each unique person equal odds regardless of how many companies register them—a change meant to curb duplicate filings and improve integrity. Those steps were significant; the September proclamation is transformational.
What exactly changed in September matters for planning. The administration’s proclamation directs the DHS to restrict decisions on petitions not accompanied by the US$100,000 payment for 12 months, and subsequent agency guidance states the requirement applies to new H-1B petitions filed on or after September 21, 2025. Crucially, current H-1B workers and petitions filed before the effective date are excluded. Universities and corporate counsel have circulated similar clarifications since the rollout. That hasn’t eliminated confusion, but it has narrowed who is immediately affected: prospective first-time H-1Bs rather than renewals or existing employees.
The implications for the labor market are stark.
Pre-2025, an H-1B case might cost an employer a few thousand dollars in government and legal fees; now, each new petition has a six-figure price tag before recruiting costs and salaries.
Large, cash-rich firms may continue sponsoring for truly scarce skills, but mid-market employers, IT services firms, and startup-stage companies will find many cases economically inefficient. Early signals from industry coverage show some heavy users weighing cutbacks while others pause filings pending the Chamber’s injunction bid. The uncertainty alone can chill fall recruiting and spring offer cycles, especially for roles intended to start in 2026.
Economists and policy researchers offer guideposts for what comes next. A recent Richmond Fed brief modeling a US$100,000 levy concludes it would likely reduce the number of college-educated immigrants in the United States, with universities and IT-intensive employers among those most affected. That follows from a broader literature: while firm-level studies sometimes find muted short-run patent gains and some crowd-out of other hires, the aggregate evidence links high-skilled immigration to productivity and innovation, with the seminal Kerr & Lincoln research showing increased patenting in H-1B-dependent regions and firms. Other macro work suggests the H-1B program expanded IT output and raised overall U.S. welfare, even as some occupations saw wage pressure. The through-line is that dialing back high-skilled inflows carries an innovation cost that compounds over time.
The legal fight will shape how severe those effects become.
The Chamber’s lawsuit—the group’s first of this presidential term—frames the fee as an ultra vires tax that sidesteps statutory limits requiring fees to reflect adjudication costs.
If a court grants a temporary restraining order or preliminary injunction, employers could resume 2026 planning under the pre-September cost structure, albeit with higher baseline USCIS fees and the new US$215 registration charge. If the surcharge remains intact through the spring registration window, expect fewer submissions and a sponsorship mix skewed to employers for whom the US$100,000 is acceptable relative to the value of the hire.
For McGill students in particular—the cross-border angle is immediate. Canadian policymakers have spent two years building brand equity with high-skilled workers via the Tech Talent Strategy, including last year’s open work-permit stream tailored to U.S. H-1B holders, which hit its 10,000-application cap in two days. Now, with the U.S. erecting a six-figure price wall, Canadian executives see opportunity. RBC CEO Dave McKay called the U.S. fee a “material opportunity” to retain international graduates and attract experienced tech workers who might otherwise head south, a sentiment echoed across business media. Companies serving U.S. clients can expand headcount in Montreal, Toronto, and Vancouver, hedge U.S. policy risk, and still collaborate across the border. Offers that begin in Canada with the possibility of U.S. transfers if and when litigation alters the fee environment are expected to increase.
McGill candidates weighing U.S. options should also remember that TN status under USMCA is different from H-1B. TN has no lottery and is not subject to H-1B-specific surcharges, but eligibility is restricted to a fixed list of professions such as Computer Systems Analysts and many engineering disciplines, and degree and day-to-day duties must match the category. USCIS updated the Policy Manual this summer to tighten and clarify several TN occupation standards and practitioners note that “Engineer” TNs generally require bona fide engineering credentials. For software-oriented roles, some graduates succeed under the Computer Systems Analyst (category) when the duties squarely fit systems analysis rather than pure software development. The TN path won’t fit everyone, but for Canadian citizens in listed professions it’s a meaningful alternative while the H-1B fee is in flux.
The next six months will answer the biggest questions. Will a federal court stay the US$100,000 fee, and will agencies carve out additional exemptions—for example, for academia or national-security-adjacent work—beyond the current focus on new petitions? How sharply will registrations for FY 2026 fall now that the lottery fee is US$215 and the surcharge looms over petition decisions? And how quickly will employers rebalance their footprints toward Canada if U.S. sponsorship becomes a six-figure call? Those markers will determine whether 2025 goes down as a temporary policy shock or the start of a lasting re-routing of North America’s innovation economy.
