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Verifying Employees' Eligibility


Immigration and Naturalization Service increases enforcement efforts against all employers

Recently in southern California, the U.S. Immigration and Naturalization Service (INS), a federal government agency, acted on a tip and raided a small but growing local business to search for unauthorized immigrant workers.

Most of the workers were found to be unauthorized, resulting in their removal by INS. This in turn forced the company to shut down due to the loss of its workforce.

The employer had obtained its employees through a city-run economic redevelopment program and had undertaken all steps which it thought were sufficient for compliance, but had failed to verify the employment eligibility of the employees.

This case demonstrates how current immigration legislation affects all employers, and not only those which hire workers directly from abroad.

The Immigration Reform and Control Act of 1986 (IRCA) imposes an obligation on employers to verify the employment eligibility (or authorization) of each employee hired by completing Form I-9.

The law contains severe penalties for non-compliance, which may include, among other things, hiring an unauthorized foreign-born worker; continuing to employ an individual hired after Nov. 6, 1986, where the employer knows or should know the worker is unauthorized; using, accepting or receiving any false document in satisfaction of any immigration requirement; violating any anti-discrimination provisions of IRCA in an attempt to comply with it; or failing to complete Form I-9 correctly.

Penalties for paperwork violations

Failing to complete Form I-9 properly when hiring a new employee (paperwork violations) can result in penalties ranging from $100 to $1,000 for each violation.

Each mistake on Form I-9, whether an error or an omission, is considered a separate mistake by the INS in assessing the penalty. In 1993, the INS recovered from a well-known southern California entertainment company a fine of $260,000 solely for 1,156 paperwork violations unrelated to hiring undocumented workers. Penalties for actually hiring unauthorized workers are even more severe and could lead to criminal penalties for second violations.

IRCA requires that Form I-9 be completed within three business days of commencement of employment. If the employee will be employed for three days or less, then Form I-9 must be completed immediately.

The employee must complete Section One of Form I-9 (containing personal identifying information such as name and address) prior to the commencement of employment and must, within the first three days of employment, present documentation to prove identity and employment eligibility.

Employees hired prior to Nov. 7, 1986, are not subject to the same requirements and provisions, provided they are continuing in their employment and have a reasonable expectation of employment at all times. All employers must comply with IRCA regardless of the number of employees within the business.

Documents acceptable to prove identity and employment eligibility are listed on the back of Form I-9. The employee chooses the documents to present for verification purposes.

Employee chooses documents

In order to not violate the anti-discrimination provisions of the law, the employer may not choose the documents or ask for additional documents or ask for documents different from those presented by the employee.

The employer must examine the documents to determine that they appear to be genuine on their face and that they relate to the individual who has presented the documents. The employer must then complete Section Two of Form I-9, concerning the documentation presented.

If an employee lists an expiration date for a document provided, the employer must, prior to the expiration date, reverify the employee's employment eligibility in the designated section on Form I-9. An employer must keep Form I-9 for each employee for three years from date of hire or one year after employment is terminated, whichever is later.

If an employer detects mistakes while reviewing Form I-9, the errors must be corrected immediately. If possible, delete the mistake with ink, insert the new information, initial the change, and insert the current date. Backdating a Form I-9 may result in a charge of document fraud.

In addition, correction fluid or other similar means should not be used to correct mistakes; the INS has been known to forward suspect Forms I-9 to forensic laboratories for analysis to determine whether they have in fact been backdated.

If the Form I-9 cannot be corrected because of its bad condition, a new Form I-9 should be created and kept together with the old I-9.

Immigration raids and audits

INS raids on businesses are increasing, particularly in targeted industries: hotel, construction, restaurant, food processing and textile and garment manufacturing.

The INS has the authority to raid a business without prior notice, either at random or based on informant leads, and to request production of Forms I-9.

After a raid, employers have three days to produce their Forms I-9, but the INS often requests that employers waive this right and produce the records immediately. It is not advisable to waive the three-day notice, but if the employer chooses to respond immediately, only the Forms I-9 (and no other documents) should be produced.

To facilitate this production, all Forms I-9 should be kept in a separate file from other employee records. Other employee documentation may be requested by subpoena.

Obtaining legal counsel

Employers should have legal counsel before complying with a subpoena, because any documents found during a search of business records may be used against the employer not only by the INS, but also by other government agencies such as the IRS.

Employers are required to produce the original Forms I-9 for inspection, but the originals should not be taken by the INS. The INS may argue that it is entitled to remove the originals, but usually agents are satisfied with copies after comparison with the original documents.

After the audit, the INS may request that the employer submit to a question-and-answer session about its hiring practices and the information gathered during the course of the audit. Employers often take legal counsel with them to these sessions.

After the audit, the INS will either issue a warning letter or, more usually, a Notice of Intent to Fine. The INS has stated as a policy that the period of educating employers has passed, and employers are now expected to know the law and to comply with its provisions.

If an employer is found not in compliance with the law, a Notice of Intent to Fine will likely be issued, after which the employer has 30 days to request a hearing before an administrative law judge to challenge the notice.

Depending on the complexities of the case, it may be more cost-effective to enter into settlement negotiations with the INS rather than litigate the matter.

Conclusion

Employers need to understand their rights and obligations under IRCA. The INS is extremely active in this area and has confirmed that enforcement efforts will increase.

The immigration laws of the United States apply not only to employers who are multinational entities, but to each and every employer, be it a large corporation or sole proprietorship.

Early planning and implementation of proper procedures and safeguards will minimize an employer's exposure to potentially large monetary penalties and disruptions of business.


Lance Kaplan is a partner with the firm Hirson, Kaplan, Perl and Stark, in Irvine. The firm practices exclusively in the area of immigration law and concentrates on business, professional, investor, permanent and temporary visas, employer sanctions and record keeping.

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