Employment Verification

Immigration and Customs Enforcement takes its enforcement of employment eligibility verification requirements seriously, and employers need to ensure compliance with Form I-9 procedures even if they participate in the E-Verify program, McDermott Will & Emery attorney Joan-Elisse Carpentier writes in this BNA Insights article.

Carpentier looks at recent cases involving ICE sanctions against employers for I-9 violations and concludes that the agency will continue to ramp up its enforcement efforts. As a result, she recommends that employers conduct internal audits to ensure compliance in order to prepare for a possible ICE audit.

Employer Sanctions and Form I-9 Compliance

On October 30, 2013, U.S. Attorney John M. Bales of the United States Attorney's Office for the Eastern District of Texas, announced that consulting, technology, and outsourcing company Infosys Corporation had reached a settlement to pay civil fines of $34 million in connection with allegations of systematic visa fraud and abuse of immigration processes (7 WIR 817, 11/11/13). The $34 million is the largest fine on record.1

While the large sum of the fine was due primarily to Infosys's alleged abuse of the H-1B visa program and B-1 visa status, David M. Marwell, Special Agent in Charge of Homeland Security Investigations in Dallas, indicated that 80 percent of Infosys's I-9 forms contained substantive violations.2 The Infosys settlement was just one in an increasingly long line of cases imposing fines for I-9 violations, underscoring the idea that the U.S. government takes visa and I-9 violations very seriously.

Form I-9: A Brief History

Prior to 1986, an employer who hired an undocumented worker faced no federal penalty for doing so. While the employee could be subject to deportation, the employer could move on to the next worker and hire him/her without worrying about legal status or facing fines or sanctions.

In 1986, the Immigration Reform and Control Act (IRCA) was passed, creating rules which subject employers to civil and criminal penalties for knowingly hiring or continuing to employ an unauthorized worker.3 As a tool to assist employers in identifying and hiring only those authorized to work in the U.S., and as a means for the government to monitor employers' hiring practices, the Employment Eligibility Verification Form I-9 was created.4

Failure to comply with the I-9 record keeping requirements subjects an employer to potential civil and criminal penalties.5 The employer is required to begin the I-9 verification procedure by the first day that the employee begins work and complete the verification process no later than three business days after commencement of employment. The form is not filed with any U.S. government agency, but must be kept on file by the employer during the course of the employee's employment.

For those persons who are no longer employed by the employer, Form I-9 must be retained for at least three years from the date of hire, or for one year after the employment has ended, whichever is later. The employer must be able to present the completed form upon request by the U.S. government in an I-9 audit or inspection process, described below.

Since IRCA first became law more than 25 years ago, Form I-9 and its underlying regulations have undergone many changes. There are complex rules regarding what documents are acceptable to demonstrate identity and work authorization, when receipts may be acceptable, when re-verification is necessary, and what fines and sanctions will be imposed.

While the government was initially slow to begin auditing and fining employers for noncompliance with the provisions of IRCA, essentially providing an informal grace period for employers to understand and comply with the new rules, by 1989 the first employer sanctions case had been litigated.6 Compliance with the provisions of IRCA is now fully in force. It is clear that Immigration and Customs Enforcement is determined to enforce I-9 regulations.7

I-9 Audit or Inspection Procedure.

Any employer can be targeted for an I-9 audit or inspection, but many audits are driven by tips provided by former or current employees, members of the public, and other government agencies. Additionally, certain industries are targeted for audits because they have historically employed large numbers of undocumented workers.

Targeted industries have included manufacturing, food and beverage (including food processing and restaurants), hospitality and construction, among others.

The audit is initiated by ICE by serving the employer with a Notice of Inspection. The NOI must provide the employer with three days' notice for the actual inspection.8 The NOI may require the employer to present I-9s for all current and terminated employees, a list of all current and terminated employees with hire and termination dates and other identifying information, payroll records, tax statements and other corporate documents. The employer will also be asked whether it participates in the E-Verify program (described below).

While the employer may be able to waive the three-day notice and allow inspection immediately, best practice is to take the full three days to collect and review all materials requested for inspection. The employer may contact ICE to arrange for a specific date and time convenient for the employer. While ICE has an absolute right to inspect on its selected date, in many cases ICE will work with the employer to arrange a reasonable date.

At the actual inspection, the inspector will review the I-9 forms for...