USCIS Releases M-274 Handbook for Employers, but Form I-9 Questions Remain

On Tuesday, February 14, while many Americans were celebrating Valentine’s Day with flowers, chocolates, and romantic overtures, the USCIS delivered its own special kind of love note by publishing the long-awaited revision to the Handbook for Employers, Guidance for Completing Form I-9 (M-274). Employers around the country have been eagerly awaiting the release of the latest handbook (often described affectionately as just “the M-274”) in the hopes that it might shed some additional light on how to properly complete the newly revised Form I-9.  The USCIS even teased us for a while, posting promises such as “New M-274 coming soon!” – its bold red text driving I-9 fanatics into a frenzied anticipation of the guidance to come.

But wait no longer, because employers can now freely download the revised M-274 from the USCIS website by following this link.  As with previous I-9 Handbooks, the revised M-274 is a “weighty” document, currently running about 69 pages cover to cover. But then again, no one ever said that Form I-9 compliance was “easy” so a certain amount of wordiness is to be expected when trying to explain an area of law that is governed by three separate government agencies (who don’t always see eye to eye).

Setting that aside for the moment, the real question is whether this newly revised M-274 will live up to the hype as the be-all and end-all of Form I-9 wisdom and guidance. Read-on to learn all about the latest changes to the M-274 and some potentially conflicting guidance which remains. You can also download our handy M-274 “Practice Advisory” which outlines all of the major changes, provides a few illustrations, and offers guidance for employers using electronic I-9 systems.

Overview

Before we get started, a word (or two) of advice. If you’re just starting out in the world of I-9 compliance, I highly suggest you read the M-274 in its entirety as you will likely find all manner of information which previously escaped your understanding and beliefs. The M-274 is not only an official “guidance” document, it is also routinely consulted and used by the Immigration and Customs Enforcement (ICE) auditors who will be reviewing your I-9s for compliance. So in other words, what you don’t know can hurt you!

That being said, the purpose of this blog is to highlight the major changes to the M-274, as compared with prior versions. It’s not intended to be comprehensive, but rather should (ideally) serve as a starting-off point for a deeper analysis of your I-9 process and workflow. With that disclaimer out of the way, let’s dive in!

Changes to Accommodate the New Form I-9

The new Form I-9 (rev 11/14/16) ushered in some new concepts and requirements, including the notion of a “smart form”, multiple preparers/translators, and the recording of certain information in a new dedicated field called “Additional Information” in section 2 (see our blog here for a more detailed look). In keeping with these changes, the M-274 has been revised as follows:

Smart Form

In several places, the M-274 mentions completing the Form I-9 “using a computer” – a somewhat opaque reference to the new “smart” fillable Form I-9 version that can be completed using Adobe PDF and printed for signature. For example, page 7 of the M-274 notes, “[w]hen completing the form using a computer, scroll down in the appropriate list to select the receipt presented.”

These instructions are fairly consistent with the Form I-9 instructions themselves and are thus not likely to cause confusion. It is important to note, however, that these references relate solely to the USCIS “smart I-9” which is separate and distinct from electronic I-9s which are completed, signed, and stored in a digital format. Both are completed “using a computer” but only electronic I-9s are entirely paperless.

Completing multiple preparers and/or translators

The M-274 also includes several sections on the preparer and/or translator section of the form which must be used when an employee has received assistance in completing section 1. For example, page 2 briefly references the preparer and/or translator section, while the bottom of page 4 describes the process for documenting multiple preparers and/or translators using the smart form.

The use of a PO box in section 1

In revising the M-274, the USCIS also removed certain instructions and guidelines which are no longer applicable under the current I-9 process. For example, older versions of the M-274 warned employees NOT to enter a PO box in the section 1 address field; in keeping with the new Form I-9 and guidance from the USCIS, this admonition has been removed from the M-274. As discussed in our prior blogs, the USCIS now permits the use of a PO box in section 1 to address concerns over employees who are part of a state address confidentiality or safe at home program (who understandably may not want to reveal their actual address).

Additional Information

Last but not least, the M-274 now includes several references to the new “Additional Information” block in section 2 – a multi-purpose field to be used for a variety of notations. In particular, check out the instructions on pages 7, 22, 23, 24, and 48 to read about the many possible uses for the biggest and widest field on the Form I-9.

I-9 Central meets the M-274

By now, many employers are familiar with “I-9 Central” – the moniker used by USCIS to describe its online library of Form I-9 and E-Verify resources and tips. I first wrote about I-9 central in May 2011 (time flies with I-9s!), and since then, the site has steadily grown to include an increasing number of instructions and illustrations, designed to address those frequently asked (and seldom answered) questions from employers regarding the I-9 process. Along the way, the M-274 became “out of sync” with these online pearls of wisdom, and the USCIS is now including a few of them in the newly revised handbook. Here are a few which caught my attention:

  • Staffing agencies may choose to use either the date an employee is assigned to their first job or the date the new employee is entered into the assignment pool as the first day of employment (see page 7). This has been settled knowledge for some time, but it’s nice to see it in the M-274 as well.
  • If a minor under the age of 18 goes to work for an employer that participates in E-Verify, the minor must present a List B identity document with a photograph (see page 9). In other words, the E-Verify rules essentially trump the special allowance given to minors who do not have an identity document.
  • With respect to refugees, the departure portion of a Form I-94 containing an unexpired refugee admission stamp or a Form I-94 computer-generated printout with an admission class of “RE” is an acceptable receipt establishing both employment authorization and identity for 90 days (see page 18). This update takes into account “electronic I-94s” which have been around for some time.
  • The M-274 now includes an entire section on the “process” for correcting I-9 mistakes – whether they occur in section 1, 2, or 3 of the form (see pages 29 to 30). It’s important to note, however, that there are MANY additional factors to consider when conducting a self-audit – as illustrated by the joint ICE/DOJ memo that was released in December 2015. We wrote about the new self-audit guidance in our blog postings here and here.

Illustrations and Sample Images

Previous versions of the M-274 featured various Form I-9 illustrations, particularly relating to “tricky” I-9s for foreign national employees. For example, an employer could review how to complete an I-9 for an employee presenting an Employment Authorization Document (EAD) or a foreign student in F-1 visa status working pursuant to curricular practical training. In many instances, these pictures also filled in the gaps by illustrating exactly how a document number or expiration date should be recorded (for example).

This latest M-274 version also includes various illustrations (showing the new Form I-9), but this time around they appear to be using a “US citizen” as their test case. To a certain degree, this makes sense since the vast majority of I-9s will be completed for US citizens. However, I think it would have been helpful to retain the illustrations for the “tricky” I-9s where the USCIS text instructions are often lacking. In addition (and I might be revealing my true I-9 “geekiness” here), I noticed a mistake on one of their illustrations on page 6 of the form where it shows a 13-digit US passport number. According to the E-Verify data validation rules, US passport numbers should be between six and nine alphanumeric characters (letters and numbers).

The USCIS also updated a few of their sample document images, starting on page 54 of the M-274. In particular, you can now view updated examples of the I-551 Stamp, EAD, Form I-20, electronic I-94, driver’s license and state ID cards, and passport covers for employees from the Federated States of Micronesia and the Republic of the Marshall Islands.

Unfortunately, some of the images (including the US passport) actually show an expiration date which has already expired – something which could have easily been fixed by adjusting the samples a few years into the future. There are also many document types for non-citizens which are not represented in the M-274, including the older Resident Alien Card issued between January 1977 and August 1989, the date of admission stamp for employees with an immigrant MRIV, and the refugee admission stamp on a paper I-94, to name a few. Employers should consider using an electronic I-9 system which has a complete document library to fill-in those gaps.

Automatic EAD Extensions

The most significant change to the M-274 revolves around the process for documenting the automatic extension of EADs for certain foreign national employees working in the US. Automatic EAD extensions is a fairly new concept, which was brought about by a DHS rule that provides additional benefits and flexibility to high-skilled nonimmigrant workers in the US. Under the new rule, EADs can be auto-extended for up to 180 days for certain individuals who timely filed to renew an EAD which is in the same category as the previous EAD.

The M-274 describes the various categories of foreign nationals currently eligible for these auto-extended EADs and sets out the process for reviewing the appropriate documentation and recording the information on the Form I-9. Employers familiar with “TPS extensions” (affecting those employees in Temporary Protected Status) will recognize the overall process, which involves updating both sections 1 and 2 to reflect the auto-extended date. The review process seems to go a bit further though, as employers are also required to more carefully review the underlying documentation (both the EAD and the I-797C receipt notice showing the renewal filing) to make sure the individual fully qualifies.

Check out pages 13 through 15 for a detailed description of how auto-extended EADs should be documented on the Form I-9. The M-274 also makes reference to the auto-extended EAD rule on page 16 (reverification), page 18 (refugees and asylees), pages 25-26 (nonimmigrants requesting extensions of stay), page 44 (accepting an expired document), and page 48 (when employment authorization expires). And if that’s not enough, you can also check out the USCIS “Fact Sheet” on automatic extensions of EADs which was published on January 30, 2017.

Additional I-9 Rules for Certain Foreign National Employees

In addition to the automatic EAD extension provisions, the M-274 features several other changes which will impact employers when hiring foreign national employees that have temporary work authorization. Here are a few areas worth noting:

  • The USCIS now explicitly notes (in keeping with its recent guidance) that employers must use E-Verify at the specific hiring site where it employs an F-1 STEM student who received a 24-month extension of their optional practical training (see page 21).
  • An acceptable Form I-20 for F-1 students in curricular practical training must have all employment authorization fields completed. These fields include employment status, employment type, start and end date of employment, and the employer’s name and location (see page 21).
  • In the context of documenting an H-1B extension and the 240-day automatic work authorization, the M-274 includes additional instructions which may (or may not) be optional. As before, the USCIS instructs employers to write “240-day Ext” and the date they submitted the H-1B extension petition in section 2. However, the M-274 now also indicates the following on page 23: “your employee may update Section 1 by crossing out the expiration date of their employment authorization noted in the attestation. Write in the new date that the automatic extension of employment authorization ends. Initial and date this update in the margin of Section 1.” This additional steps is at odds with the current practice, and seems unnecessary. Also, the use of the word “may” will be confusing to employers since it’s not entirely clear if this new process is strictly required.
  • The M-274 also includes new instructions relating to documentation which must be maintained when filing an extension of stay for a qualifying employee. Specifically, page 25 indicates: “After you receive the I-797C, Notice of Action, which bears the amount of the filing fee submitted and acknowledges USCIS’ receipt of the new Form I-129 petition, it is not necessary to maintain a copy of the Form I-129 application, proof of payment, and mailing receipt for Form I-9 purposes. You should retain the I-797C, Notice of Action to show that you filed for an extension of stay on the employee’s behalf.”

Retaining the Form I-9 for Non-Starts

Last but not least, the M-274 includes a provision relating to the retention of I-9s, which is inconsistent with the regulations and the guidance set forth by ICE. Specifically, on page 31, they note the following:

“Employers must retain a Form I-9 for each person hired. This requirement applies from the date of hire, even if the employment ends shortly after hired, the hired employee never completes work for pay, or never finishes the Form I-9.” (emphasis added)

Based on the above, the USCIS appears to be stating that employers need to retain I-9 forms for employees, regardless of whether or not they ever start work or receive a paycheck. However, the regulations at 8 CFR 274a.2 specifically define an employer’s I-9 obligation with respect to an individual who provides services or labor for wages or other remuneration. An individual who never starts work for pay would arguably not fall into this category (and thus no I-9 obligation exists). Moreover, officials from ICE have previously noted that an employer is not required to retain a Form I-9 for an individual who never starts work for pay, and thus would not be required to produce the I-9 in the event of an inspection.

Needless to say, this issue will be especially important to staffing agencies, many of whom regularly destroy I-9s for individuals who were assigned to the “pool” of potential referrals but never actually started work. Hopefully, the USCIS will revise the M-274 again to clear-up the confusion.

Conclusion

Form I-9 and E-Verify compliance has become a sprawling system of instructions, FAQs, and illustrations, which are delivered to busy employers through a variety of means. Gone are the days when an employer simply had to consult one manual, one source of truth to figure out how to comply with immigration rules. Now, the employer must consult several sources contemporaneously, including the Form I-9 instructions, the M-274, and the ever-changing Form I-9 central website.

Faced with this daunting task, employers must be vigilant in keeping up-to-date with the latest and greatest I-9 and E-Verify guidance and tidbits, and develop processes and procedures to ensure consistency throughout the organization. Experts recommend reviewing current policies and practices with counsel; conducting a self-audit to fix mistakes and omissions; and adopting smart electronic I-9 processes which ensure compliance with ever-changing (and often unpredictable) government rules.

Do you have questions or comments relating to the M-274?  Please feel free to contact us here. You can also reach me by emailing at the address provided in my bio link below.

*********

John Fay is an immigration attorney and technologist with a deep applied knowledge of I-9 compliance and E-Verify rules and procedures. During his career, John has advised human resource managers and executives on a wide variety of corporate immigration compliance issues, including the implementation of electronic I-9 systems. In his current role, John serves as Vice President and General Counsel at the LawLogix division of Hyland Software, Inc., where he is responsible for overseeing product design and functionality while ensuring compliance with ever-changing government rules.