Twenty US states have filed a lawsuit against the Trump administration over a policy imposing a $100,000 fee on new H-1B visa petitions, arguing that the move is unlawful and would harm critical public services.

The legal challenge targets a Department of Homeland Security policy that dramatically raises the cost for employers hiring high-skilled foreign workers under the H-1B programme, which is widely used by hospitals, universities and public school systems. The lawsuit is being led by California Attorney General Rob Bonta.

Bonta said the administration lacks statutory authority to impose such a fee, arguing that it creates severe financial burdens for public employers and worsens labour shortages in key sectors. He added that the measure undermines the economic benefits skilled international workers bring to states such as California.

President Donald Trump ordered the fee through a proclamation issued in September 2025, with the policy applying to H-1B petitions filed after September 21. The states contend the decision violates the Administrative Procedure Act and the US Constitution by bypassing required rulemaking and exceeding congressional authority.

The attorneys general warned that the policy would deepen staffing shortages in education and healthcare, sectors that rely heavily on H-1B professionals. The programme remains a major pathway for skilled foreign workers, including large numbers of Indian professionals employed across technology, medicine and academic research in the United States.