Compliance considerations for employers of new H-1B workers who changed status from F-1 OPT, STEM OPT, or another status

For many employers, October 1 marked the day a new group of employees moved into H-1B status. Cap-subject petitions approved with a change of status took effect at the start of the federal fiscal year, and these employees are now working under the terms of the approved Form I-129 petition and the certified Labor Condition Application (LCA). Approval is an important milestone, but it also triggers several employer obligations. The first weeks after the change of status are a good time to confirm that the job matches what was filed, that payroll reflects the employee’s new tax status, and that obligations tied to the employee’s prior status are properly closed out. These steps also apply to employees whose change of status takes effect later, such as a beneficiary whose cap-subject petition is still pending. For those employees, complete the steps below on the date H-1B status begins.

Align the Job with the Approved Petition

The approved petition and LCA describe a specific position: the duties, job title, occupational classification, offered wage, and place of employment. From the first day in H-1B status, the employee’s actual job must match those terms. This is easy to overlook when an employee has been in the same role for months or years on OPT and the job has evolved since the petition was prepared in the spring. Confirm the following as of the H-1B start date:

• The employee is performing the duties described in the petition and support letter.
• The job title in HR systems, offer letters, and organizational charts matches the petition.
• The employee is paid at least the wage stated on the LCA and petition. If the employee earned less on OPT, the increase must take effect with the first H-1B pay period.
• The employee is working at the worksite(s) listed on the LCA. For remote or hybrid employees, the home office is a worksite and must be covered. Confirm that the LCA notice was posted and the public access file is complete.

For a broader overview of H-1B employer obligations, including wage, benefits, and I-9 requirements, review Employer Actions Needed for New H-1B Employees.

When a Change Requires an Amendment

If something does not match, address it promptly. A move to a worksite outside the area of intended employment on the LCA generally requires a new LCA and an amended petition filed before the move. A move within the same area typically requires a new LCA notice posting but not an amendment. Material changes in duties, occupational classification, or full-time versus part-time status may also require an amendment. Before planning any change this year, see the caution about early amendments below.

Update Payroll for FICA Withholding

F-1 students, including those on OPT and STEM OPT, who are nonresident aliens for tax purposes are generally exempt from Social Security and Medicare (FICA) taxes, as are many J-1 exchange visitors. That exemption does not carry over to H-1B status. H-1B workers are subject to FICA withholding whether they are resident or nonresident aliens for income tax purposes.

Payroll should begin FICA withholding on wages earned on and after the H-1B start date, and a pay period that straddles the change of status may need to be split. If the update was missed for the first October payroll, correct it as soon as possible and work with your payroll provider to collect and remit the missed employee and employer shares within the same calendar year. The change to H-1B may also affect the employee’s income tax residency, since days in F-1 status are often excluded from the substantial presence test while days in H-1B status count. Encourage the employee to review Form W-4 with a tax professional.

Close Out the STEM OPT Training Plan

When an employee on the STEM OPT extension changes to H-1B status, the STEM OPT period ends early. The obligations the employer accepted when signing the Form I-983 Training Plan do not simply lapse, and the plan should be properly closed out:

• Complete the final evaluation on Form I-983, covering the period from the last evaluation through the last day of STEM OPT. The employee completes the self-evaluation, and the supervisor reviews and signs it. Under DHS’s STEM OPT employer reporting guidance, the student must submit it to the Designated School Official (DSO) no later than 10 days after the reporting period ends. For an October 1 change of status, that deadline falls in the first half of October.
• If the employee was on STEM OPT for more than 12 months, confirm that the 12-month evaluation was submitted. If it was missed, complete it now.
• Employers must report to the DSO within five business days when a STEM OPT student’s employment ends. A change to H-1B is not a termination, but confirming in writing that STEM OPT ended due to the change of status keeps the record clean.
• Keep the signed Form I-983, all evaluations, and DSO correspondence in the employee’s immigration file.

For STEM OPT employees who are still in cap-gap, Form I-983 obligations continue in full until H-1B status begins, including the 12-month evaluation and a modified Form I-983 for any material change to the training plan.

Employees Still Waiting on a Decision

Not every cap-subject petition was approved by October 1. Under the H-1B modernization rule that took effect in January 2025, cap-gap extends an F-1 student’s status and work authorization until the petition is adjudicated or April 1, whichever comes first. For FY 2027 petitions, that date is April 1, 2027. Review Cap Gap After the 2024 Final Rule: What Every Employer Needs to Know.

If a petition is still pending on April 1, 2027, cap-gap ends and the employee must stop working unless they have another basis for employment authorization, such as an unexpired EAD. If a petition has not been adjudicated by around February 2027 at the latest, we recommend upgrading to premium processing by filing Form I-907. USCIS commits to take action within 15 business days, but that action may be a Request for Evidence (RFE). Upgrading by February leaves time to respond to an RFE and still receive a decision before April 1.

When a pending change of status is approved, H-1B status begins on the validity start date shown on the Form I-797 and I-94, which is typically the approval date. The job alignment, payroll, and I-983 steps above apply from that date.

Be Cautious About Early Amendments

Business needs change, and some employers will want to move a newly approved H-1B employee to a different office or role. This can be done properly through an amended petition. This year, however, employers should consider carefully what is changing and how soon.

How Weighted Selection Changes the Analysis

The FY 2027 cap was the first season under DHS’s weighted selection rule, effective February 27, 2026. Each registration received one to four entries in the selection pool, based on the highest OEWS prevailing wage level (Level I through Level IV) that the offered salary met for the occupation and area of intended employment. The petition and LCA must be consistent with the registration, and USCIS may deny or revoke a petition where it finds the petitioner attempted to unfairly increase the odds of selection.

The same salary can fall at very different wage levels depending on where the job is located. Consider this example:

• At registration and filing, the employee’s worksite was in an area where their salary met Level III or IV, giving the registration three or four entries.
• Shortly after approval, the employer files an amendment moving the employee, at the same salary, to a higher-cost area where that salary meets only Level I or II.

The amendment may satisfy LCA wage requirements, but the pattern invites the question of whether the original worksite was a bona fide job offer or was chosen to improve the employee’s chances in the lottery. An amendment filed soon after approval that would have produced a lower-weighted registration is likely to draw scrutiny. It could support revocation of the petition and complicate future extensions and green card filings.

Before relocating, promoting, or restructuring a new H-1B employee’s position, consult counsel, document the business reason at the time of the decision, and consider whether a salary adjustment could maintain the same wage level. Where the change is discretionary, allowing a reasonable period of employment under the approved terms is the safer course. Changes that do not lower the wage level present much less risk, although they may still require an amendment or a new LCA posting.

Act Now

Confirm that each new H-1B employee’s duties, title, salary, and worksite match the approved petition, update payroll for FICA withholding, complete STEM OPT final evaluations promptly, track pending cap-gap cases for a premium processing upgrade by February, and consult counsel before changing a new H-1B employee’s position. Taking these steps now can help avoid problems in a Department of Labor investigation, a USCIS site visit, or a future extension or green card filing.

For more information, or for a detailed conversation regarding the H-1B change of status, please schedule a time to speak here

By: Rebecca Chen

Rebecca Chen is a Partner at Reddy Neumann Brown. Her representation includes advising clients throughout the non-immigrant and immigrant visa application process, from initial filing, responding to various requests for evidence, and processing at overseas consulates. Her years of experience in the immigration field have made her a knowledgeable resource for complex business immigration matters.