Form I-9 Basics Every HR Should Know

[Editor’s Note: With the revised Form I-9 required to be used by all employers tomorrow, today’s blog is courtesy of Ms. Giselle Carson, Attorney at Marks Gray, P.A. in Jacksonville, Florida.]

Immigration reform continues to be at the top of the 2013 agenda for President Obama and the Congress.  Any reform will likely include continuing worksite enforcement and fines for employers that fail to properly verify their workforce and an expansion of (even mandatory) E-Verify.  Additionally, USCIS released a revised and expanded Form I-9 which must be in use by tomorrow, May 7th.

Employers are likely to be engaged in responding to an I-9 Notice of Inspection, determining whether to settle or litigate a Notice of Intent to fine; and acting on a Notice of Suspect documents.

Favorable decisions from the Office of the Chief Administrative Hearing Officer (OCAHO)can help you evaluate your company’s current status and plan for training and attorney-directed compliance audits.

What are the employer’s employment verification obligations?

The I-9 has two main parts: Section 1 is completed and signed by the employee attesting as to his/her status; and Section 2 is completed and signed by the employer and contains specific information about the documents examined to establish the employee’s identity and eligibility for employment. Employers can, but are not required, to copy the documents they examine.

How are penalties determined?

Monetary penalties are assessed for I-9 substantive and uncorrected technical violations.  The minimum penalty for each violation is $110, and the maximum is $1,100. Additionally, ICE has a Guide to Administrative Form I-9 Inspections (the Guide) which contains a matrix whereby a baseline penalty is calculated and can be aggravated or mitigated by other factors.

Whether a violation is technical or substantive is also based on the seriousness of the error and whether or not it could have led to the hiring of an unauthorized alien. Technical or procedural errors are certain minor, unintentional violations such as failure of the employee to include his or her address and/or date of birth.  In the case of a technical violation, the employer must be given notice and ten business days to correct the error before it can be fined.

The difference between a technical and substantive violation can mean a difference in how much employers pay in penalties.  To date, the INS Virtue Memorandum is by far the most helpful guide.

Can ICE’s I-9 paperwork penalties be negotiated or litigated?

Yes.  Although ICE has broad authority and discretion in deciding how to assess and negotiate penalties; its internal guidelines have no binding effect in OCAHO. If ICE’s proposed penalties are unreasonable or disproportionate considering the facts, and ICE will not negotiate a reasonable reduction in the penalties, the employer should consider requesting a hearing with OCAHO.

What factors determine whether an employer is liable for the “knowing hire” or continuing to employ an unauthorized worker?

In addition to I-9 paperwork violations, an employer could be liable for the knowing hire of unauthorized workers.  Under the regulations, “knowing” includes actual and constructive knowledge. Actual knowledge is established through evidence that the employer, or its agent, knew that the worker was not authorized to work.  When the evidence demonstrates an employer should have known that the worker was not authorized, constructive knowledge is inferred.

Employers found to have knowingly employed an unauthorized worker may be fined, could be subject to cease and desist orders, be criminally prosecuted, and may be subject to debarment from federal contracts.

If an employer fails to complete section 2 of Form I-9 but retains copies of the documents provided by the employee is the employer relieved from liability for a substantive paperwork violation?

No.  I encounter this violation often when auditing I-9s.  The copying or keeping an electronic image of the document presented by an employee does not relieve the employer from the requirement to fully complete section 2 of the Form I-9. (8 C.F.R. 274a.2(b)(3), emphasis added).

The future of the Form I-9?

I-9 audits and fines are going to continue throughout 2013 and beyond.  In 2007, ICE conducted only 250 I-9 audits. The number has increased to 3,000 per year recently.

More than $87 million in fines have been issued to employers for employment verification violations. Any company, regardless of geographic location, size, and composition of workforce or industry can be audited at any point in time.

Taking proactive steps by providing attorney-led training and auditing can not only save an employer significant amount of money and time but it can also help to avoid bad publicity and additional compliance responsibilities.  Auditing, correcting and evaluating a potential penalty is complicated … Start now to protect your business!

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Ms. Giselle Carson is a Shareholder at Marks Gray, P.A. and practices in the area of U.S. and global immigration, corporate and business law, and civil litigation.  She current serves as the International Chair for the Jax Regional Chamber of Commerce.