ABCs of Immigration: I-9 Compliance - Avoiding Immigration Bombshells
While immigration can be a highly divisive issue, employers need to focus on complying with the law. Most employers will never file a visa application for a worker. But the mistake many business owners make is assuming that no foreign employees means no need to worry about immigration laws.
This article will focus on the
employment verification requirements under Immigration Reform and Control Act
of 1986 (“IRCA”). Those provisions made every employer in the
country a deputy of US Immigration and Customs Enforcement. Employers are
required under that law to verify the identity and work authorization status of
every employee of the business. The mechanism for compliance is the I-9
Employment Verification Form that every worker must complete on the day of hire
or earlier. Failure to comply with IRCA’s I-9 rules
can result in significant fines, loss of access to government contracts and
highly negative publicity for a company. But despite the focus on immigration
in the news, a large number of companies fail to comply with IRCA’s I-9 rules.
What is an I-9 Form?
The I-9 is a one page form
employees complete verifying their identity as well as proving they are allowed
to work in the
must an employee present along with an I-9 Form?
Employees must present
documentation of identity and work authorization and can present documents from
a pre-set list included in the I-9 Form’s instructions. Some documents, like a
Who must complete an
IRCA requires all employers to have all employees hired after 1986 complete I-9 verification paperwork. Workers who are not hired do not need to complete I-9 Forms and employers who selectively choose who will and will not complete I-9s could face penalties under anti-discrimination rules. Volunteers are not subject to I-9 rules since they receive no “remuneration” for their services. Independent contractors are also not subject to the I-9 rules, but employers should note that if they contract work to companies they know use unauthorized workers, they could be held liable as well under IRCA. Persons transferring within a company are not required to complete an I-9 form, but the easiest practice is usually to complete a new I-9 anyway rather than having to document the I-9 was done previously. Employees rehired by a company need not complete a new I-9 as long as they resume work within three years of completing the initial form I-9. Also, it is not necessary to complete a new I-9 after
When must the I-9
Form be completed?
The I-9 process must start on the day
an employee starts work. The employee must complete the first section of the
I-9 form and must provide the supporting documents noted above within three
days of the date of hire. If the documents are not presented by that point, the
employee must be removed from the payroll (though it is permissible to suspend
the worker rather than terminating the worker all together). While it is
possible to require people to complete the I-9 form before the first day of
employment, many immigration lawyers caution against this because the form does
elicit information about one’s national origin and a decision not to hire a
worker could trigger a discrimination claim. To the extent an employer chooses
to have I-9s completed before the date of hire, they should only be requested
after a position has been offered and accepted and there should be a uniform
policy applicable to all employees receiving an offer of employment having to
complete the I-9 ahead of time.
Can an I-9 Form be completed electronically?
In October 2004, legislation was enacted that allows for the I-9 to be completed, signed and stored on a computer. In June 2006, regulations were issued implementing the new statute. The new rules sets standards for completing forms electronically and also for the scanning and storage of existing I-9 forms.
What are the I-9 recordkeeping requirements?
Employers must keep I-9 Forms for all current employees. For terminated employees, the form must be retained for at least three years from the date of hire or for at least one year after the termination date, whichever comes later.
Retaining copies of the supporting documents is voluntary, however. Employers can retain copies of documents and attach them to the completed I-9 Form. Immigration lawyers disagree over whether employers should or should not retain copies of supporting documents. Certainly maintaining documentation could provide a good faith defense for an employer in showing that it had reason to believe a worker was authorized even if the paperwork was not properly completed. IRCA compliance officers may also be suspicious of employers that don’t keep copies of documents. Of course, keeping documents also leaves a paper trail. Whatever a company decides, however, it is important that the policy be consistently applied. Keep all the documents or keep none of them.
What are the I-9
If an employee is not a
How do mergers,
acquisitions and other major changes affect I-9 requirements?
While a closing may be a cause for celebration at a company, it can also be the cause of a nightmare for a company since it can instantly render all completed I-9s for an acquired company invalid. If the acquiring company does not assume all of the assets and liabilities, then the I-9s will likely not transfer. In a merger case where the acquiring entity is a successor in interest, new I-9s will not be needed. However, I-9s should be checked in the due diligence process to ensure that the acquired I-9s are in good shape. Employers should consider adding I-9s to a merger checklist and have all employees of the combined company complete I-9 forms on the day of closing or beforehand. In any case, an immigration lawyer should be consulted in any merger, acquisition or divestiture to ensure that the transaction does not result in new immigration problems.
What are the IRCA
anti-discrimination and document abuse rules?
While employers need to be
diligent about complying with IRCA’s employment
verification rules, they should not be so overzealous that they end up
penalizing qualified workers. IRCA also has anti-discrimination rules that can
result in an employer facing stiff sanctions. Employers of more than three
employees are covered by the IRCA anti-discrimination rules (as opposed to the
15 or more employees required by Title VII of the Civil Rights Act). IRCA
Under IRCA, employers may not
refuse to hire someone because of their national origin or citizenship status
and they may not discharge workers on those grounds either. The employer is
also barred from requesting specific documents in completing an I-9 Form and
cannot refuse to accept documents that appear genuine on their face. But note
that an employer must be shown to have had the intent to discriminate.
Employers can separately be sanctioned based on legislation passed in 1990 if they request more or different documents than required by the I-9 rules. Employers originally were held strictly liable for violations under this category, but in 1996 legislation was passed requiring a showing that employers intended to discriminate.
What penalties does
an employer face for I-9 violations?
Employers can face stiff penalties for IRCA violations that include substantial fines and debarment from government contracts. Penalties can be imposed for hiring unauthorized workers as well as simply for committing paperwork violations even if all workers are authorized to work. Fines for hiring unauthorized workers will amount to anywhere from $250 to $5,500 per worker depending on the prior history of violation. Employers can also be barred from competing for government contracts for a year if they knowingly hire or continue to employ unauthorized aliens. Paperwork violations can also result in significant fines. Each mistake or missing item on a form can result in a $100 penalty up to $1000 for each form. A missing form would automatically be assessed at $1000. An employer, for example, that had 100 employees and did not complete I-9 Forms might face a $100,000 fine. IRCA investigators have considerable discretion in assessing fines and will look at factors like the size of the company, the seriousness of the violations, whether the employer was trying to comply in good faith and the pattern of past violations.
Employers should also be cautioned that knowingly accepting fraudulent documents from employees is a different kind of violation that can be criminally prosecuted under other immigration laws.
What are the best
ways to prevent being prosecuted for I-9 violations?
Employers can minimize the chances
for being found to have violated IRCA’s employment
verification rules by undertaking several steps: