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Creative I-9 Practice Leads to Wrongful Termination Lawsuit

Ensuring I-9 compliance is often a thankless job for HR and hiring managers. In fact, it’s not unusual to hear people describe the I-9 process as mere paperwork – just another form to fill out along with a W-4, health insurance application, and emergency contact information. Read this, complete that, sign here, and you’re off to the races. Now, if you’re reading this blog, you probably know better. You know all about the hidden dangers of this 2-page conundrum, the potential penalties and fines, and the various government agencies that stand ready to contact you if something goes wrong (sometimes working jointly, hand-in-hand).

But what you may not realize is that I-9 threats can also arise from within your organization – from your own management no less – and for reasons which (on the surface) have absolutely nothing to do with hiring a legal workforce. Instead, these threats emerge from perfectly reasonable goals such as onboarding efficiency and meeting project deadlines.

And that brings us to today’s blog on an interesting lawsuit out of Pennsylvania (Miranda v. Environmental Materials, LLC) which I’m calling the “Case of the Wrongful I-9s.” Before proceeding, please note that this lawsuit is still in the very early stages, and all of the facts described below are only “alleged to have occurred” (and not proven). The defendant may have an entirely different story to tell once they get their day in court.

The Parties

The defendant (Environmental Materials) is a leading manufacturer of stone veneer products, selling directly to residential and commercial builders. According to their website, they are the only stone manufacturer that also installs the stone products as well – which means they need to hire project managers, account managers, craftsmen, and other workers at the various sites.

According to the complaint, the plaintiff (Jessica) had worked for the company for a long time (dating back to 2005) in a variety of administrative roles. Over the years, her responsibilities increased to include everyday human resource activities including payroll and I-9 completion. Lucky her.

The Hasty Hire

Fast-forward to February 2013, and Jessica is under a lot of pressure. Certain new employees need to be at a job-site immediately (“yesterday” in fact), and the office manager tells her to fast track the new hire paperwork. This is nothing new of course – HR managers often find themselves under very tight onboarding deadlines to make sure that new hires can become productive employees as soon as possible.

But there was one wrinkle…according to Jessica, her superiors went so far as to suggest that she complete the I-9 form without physically seeing the required documentation. More specifically, she was encouraged to “get creative to get this done” by (among other things) viewing the I-9 supporting documents on her cell phone.  Now I know what you’re thinking – I-9 compliance and creativity are generally not uttered in the same sentence. Jessica also felt this way as well, and apparently refused to follow along – pointing out that they were asking her to break the law.

The Discipline and the Lawsuit

According to the complaint, Jessica was formally disciplined by management for failing to follow their “creative” I-9 directive. Jessica persisted – contacting the company’s corporate HR to explain to them how she could not in good faith sign the I-9 if she had not physically seen the documents. As it turns out, corporate HR was unsympathetic to her cause, and she was terminated from her position three weeks later. Subsequently, the company clarified that in fact her position had been “eliminated” (a claim that Jessica refutes).

She is now suing the company for wrongful termination and arguing, in particular, that the company retaliated against her for refusing to commit an unlawful act (the falsifying of I-9 records).  She is asking for back pay, front pay, salary, pay increases, bonuses, insurance, benefits, training, promotions, and seniority within the company. Oh, and of course, punitive damages as well.

I-9 Lessons Learned

As mentioned earlier, it remains to be seen how the company will respond to Jessica’s allegations. Will they tell a different story about the I-9 process? Perhaps there were other legitimate reasons for terminating Jessica’s employment? Regardless, this case gives us an opportunity to review some basic (but important) I-9 rules and principles which should be followed by all employers:

1. Treat the I-9 form seriously. It may seem innocuous and routine, but the I-9 form is there for a reason (namely, to ensure that employers hire a legal workforce). The government can (and will) enforce this requirement vigorously, particularly when the employer is in an industry that is susceptible to unauthorized employment. Taking creative shortcuts (for the sake of business efficiency) is a substantial risk which should be avoided.

2. Don’t get “too creative” when reviewing I-9 documents. Under the law, employers or their designated representative must physically touch and examine identity and work authorization documents in the presence of the new hire employee. The USCIS has made it very clear that reviewing or examining documents via webcam (or similar technology) is not permissible under the regulations. Want to see proof? Check out our earlier blog on the staffing company that was fined over $200,000 for a very similar time-saving process.

3. Create standard operating procedures for your I-9 document review process. Experts have long recommended that employers create their own internal I-9 handbook, which specifically documents (in some detail) how I-9 forms will be completed and reviewed for accuracy. Having an SOP not only shows good faith (in the event of government audit), it also serves as a training document – which is particularly important for large organizations where there is a possibility that a hiring manager might go rogue and “get creative” with your precious I-9 rules.

4. Use electronic I-9 software to enforce your procedure. Once you’ve crafted your SOP (ideally, with the help of counsel), you’ll want to consider using an integrated electronic I-9 and E-Verify solution that will ensure your onboarding efficiency and enforce the various I-9 requirements. A well-designed system will include prompts and reminders regarding the I-9 rules as well as a detailed audit trail which can be used to substantiate your process in the event of an audit (or perhaps even a thirty party lawsuit!)

Want to learn more about how an electronic I-9 system can automate your process while ensuring compliance with I-9 regulations? Contact us today to learn more about the Guardian I-9 and E-Verify solution from LawLogix.


Human Resources Today