Gotta Have Good Faith: Applying Good Faith Defenses Against I-9 Violations

[Editor’s Note: Today’s article is courtesy of Giselle Carson, Attorney at Marks Gray, P.A. in Jacksonville, Florida.]

Employers often assert good faith compliance to mitigate charges and fines for alleged employment verification violations and/or charges of having knowingly hired an unauthorized worker.  However, in many instances this defense fails because the employer has not taken the proactive steps required for the defense to succeed.  What are effective ways to make the best use of the good faith defense? Read on to learn more.

When Can Employers Benefit from the “Good Faith” Defense?

  1. When asserting an affirmative defense for good faith compliance with the hiring, recruiting, or referral for employment of an alien in the U.S.;
  2. When limiting liability for having complied with the employment verification requirement; and
  3. When assessing the appropriateness of civil monetary penalties imposed on employers.

Good Faith Defense Applied to Form I-9 Technical/Procedural Violations

This defense affords employers 10 days after notice to correct certain technical or procedural errors committed when preparing a Form I-9 and avoid liability. This defense does not apply to substantive violations such as failure to complete an I-9 timely.

This issue was illustrated in a recent OCAHO case, where the employer had been operating a metal-finishing factory for almost 35 years before it was charged with hiring undocumented workers and failing to timely prepare or present Forms I-9.  (See U.S. v. Anodizing Industries Inc.) In its defense, the employer asserted good faith compliance with the requirements of the immigration laws, arguing it should not be penalized because its employees’ omissions of dates on the Forms I-9 were minor technical or procedural violations.  The court disagreed and reasoned that this was not a case of employees accidentally leaving blank dates off the Forms I-9 but a case of substantive violations for untimely preparing them.  The evidence showed many Forms I-9 were completed 13 days after the Notice of Inspection (NOI) was served and one day before the forms were delivered to ICE.  The employer’s delays in preparing Forms I-9 ranged from a matter of weeks to 22 years.  The court noted:

[W]aiting to prepare an I-9 for up to twenty-two years after an employee is hired is not a technical violation. Nor does it demonstrate that Anodizing ‘made every effort to remain knowledgeable of the law,’ as it contends, or reflect a good faith attempt to comply with the recordkeeping requirements.

Good Faith Defense Applied to the Assessment of An Employer’s Penalty

In assessing the employer’s penalty, the government and the court must consider five factors one of them being the good faith of the employer.  The law provides that an analysis of an employer’s good faith begins with determining whether the employer reasonably attempted to comply with its obligations prior to an NOI being issued.

In another OCAHO case, ICE’s complaint alleged the employer failed to prepare Forms I-9 timely or prior to the service of the NOI. ICE arrived at a base fine for the violations and then aggravated the fines on the basis of the company’s lack of good faith in the employment verification process. ICE presented evidence that 55 of the Forms I-9 produced were not prepared within three days of the employees’ hire dates but after the NOI was issued, and even those contained substantive errors. (See U.S. v. Modern Disposal Inc.)

The court disagreed with ICE.  It reasoned that the tardy completion of an employer’s I-9s, without more, is not evidence of bad faith.   A finding of bad faith must be supported by “evidence pointing to culpable behavior beyond the fact that a high number of the Forms I-9 are missing or contain deficiencies . . . .

The court looked favorably upon the fact the employer admitted the Forms I-9 were filled out after the NOI was served; and that since the NOI was issued, the employer had been able to hire a human resources director to oversee preparation of hiring documents.  These factors contributed to a finding the company had complied in good faith with the law.

On the contrary, in other cases, the courts have found evidence of culpable behavior when an employer or employee backdates or otherwise concealed information or misled the government as to when the Forms I-9 were actually completed.  Lack of good faith has also been found when the employer delegated the I-9 functions to employees who were not trained or qualified to perform these tasks, and also when the employer took no action to educate its staff about its I-9 responsibilities.

What Can We Learn From the Case Law:

  • Failure to prepare a Form I-9 within three business days of an employee’s hire date is always considered a serious violation because an employee could be unauthorized for employment during the entire time his or her eligibility is unverified.  This is a substantive violation that will lead to the most severe fines.
  • The longer an employer delays in preparing an employee’s Form I-9, the more serious the violation, and the harder it will be for the employer to assert the good faith defense.
  • The good faith defense is supported by evidence of proactive education, training, audits and compliance with the employment verification requirements.
  • A poor rate of Form I-9 compliance is insufficient, without more, to show a lack of good faith for aggravation of penalties absent some culpable conduct going beyond mere failure to comply.
  • Backdating Forms I-9 or otherwise concealing information or misleading a government investigation has been considered evidence of lack of good faith.

The best defense against I-9 charges and fines is to be proactive and diligently ensure that Forms I-9 are completed timely and correctly for all required employees before the government or OCAHO gets involved.

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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.   She represents employers in all areas of immigration law and has experience representing clients in federal and state courts and before federal agencies, particularly in immigration compliance and I-9 audits.   She is AV-rated by Martindale-Hubbell.  She is also the International Chair for the Jacksonville Chamber of Commerce and a Board Member of the Jacksonville Bar Association.