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DHS increases civil penalties for I-9 paperwork violations as of October 19, 2021

At first glance, an I-9 looks like a simple, relatively straight-forward government form with a singular purpose: verifying your new hire’s eligibility to work in the US. The employee completes Section 1, the employer representative reviews documents and completes Section 2, and everyone goes on their merry way.

However, if you’re in HR and reading this blog, you know all about the dangers that lurk within your I-9 forms. Halloween may be behind us this year, but employers are often petrified of reviewing their I-9s for fear of discovering all of those insidious errors and omissions that can land them into some serious hot water with the government. All it takes is a forgotten signature, incorrect document choice, or a missed reverification to turn your relatively benign-looking I-9 form into a ticking time bomb of liability.

And last month, the Department of Homeland Security raised the stakes (ever so slightly) when they announced an increase to the civil penalties that can be assessed against employers for failing to complete their I-9s as required under the law.

But before we explore those changes, let’s briefly review how Form I-9 penalties are assessed (and why this should matter to you).

Form I-9 Penalties (in a Nutshell)

Let’s say you just received a Form I-9 “Notice of Inspection” (NOI) from Immigration and Customs Enforcement (ICE). Resisting the urge to panic, you read through the notice and learn that you must turn over all of your I-9s and a wide variety of HR and business documents to ICE within 3 days. Again, resist the urge to panic.

Upon receipt of those I-9s, ICE will review each form to identify any technical or procedural violations (e.g., a missing date of birth or address), substantive violations (e.g., missing signature, missing documents, etc.) and any instances when an employee may be knowingly employing an undocumented worker.

ICE will notify you of the technical or procedural violations and provide you with 10 business days to make corrections. If you’re able to correct the errors, those violations are exempted from fines. Hooray! On the other hand, if you’re unable to make corrections, those errors turn into “substantive” violations, which are fineable.

At the end of the process, ICE will add up the number of substantive violations and divide it by the number of error-free I-9 forms that you should have presented (in an alternate universe, perhaps). This number becomes the error rate for substantive violations. For example, if you should have 100 I-9 forms but ICE identifies errors on 75 of them, the substantive error rate will be 75%.

Once the error rate is calculated, ICE utilizes a graduated scale for the fine amount, which is assessed at the I-9 level. For many years, I-9 paperwork violations were assessed at a range of $110 to $1,100 per errant form. However, in August 2016, the fine amounts for I-9 violations essentially doubled in size – courtesy of a new rule that increases monetary penalties across the board on an annual basis in order to account for inflation and to ensure that the fines continue to maintain their deterrent effect.

Civil Monetary Penalty Adjustments for 2021

Which brings us back to our news for today. On October 18, 2021, the Department of Homeland Security published a notice in the federal register, announcing their annual inflation adjustments to a wide variety of civil monetary penalties, including Form I-9 paperwork fines.

Pursuant to this rule, the penalty amounts shown below will be effective for penalties assessed after October 18, 2021 where the associated violation occurred after November 2, 2015 (when the inflationary rule went into effect).

Penalty Name Citation Old Penalty Amount New Penalty Amount
Civil penalties for I-9 paperwork violations 8 CFR 274a.10(b)(2) $234 – $2,332 $237 – $2,360

It’s also important to remember that uncorrected Form I-9 mistakes are treated as “continuing violations” by the agency, which means that ICE will consider them to have occurred after November 2, 2015 (regardless of when the error or omission actually happened) for purposes of assessing the fine.

In addition, the penalties for knowingly hiring, recruiting, referring, or retaining an unauthorized worker will increase per unauthorized individual to $590 to $4,722 for the first offense; $4,722 to $11,803 for the second offense; and $7,082 to $23,607 for subsequent offenses.

Key Take-Aways For HR

In light of these increasing fines, employers must pay very close attention to their current I-9 policies and procedures to completely eliminate (or at the very least reduce) the chances of errors and mistakes. Here are three strategies that are now routinely followed by employers today:

  1. Review your current I-9 policies and practices with counsel: employers (ideally with the assistance of counsel), must carefully analyze their current I-9 policies and procedures to ensure they are complying with the latest I-9 and E-Verify rules. As part of this process, employers should develop a formal I-9 and E-Verify policy document which outlines all of the various I-9 and E-Verify tasks and responsible parties.

 

  1. Improve the Process: mistakes are inevitable unless you implement a fool-proof process for detecting and preventing I-9 violations. Many employers today utilize a smart electronic I-9 systemwhich can instantly alert you (and your new hire employee) of errors or omissions and facilitate the overall management of your I-9 and E-Verify process.

 

  1. Correct historical I-9s now (while you can): fortunately, the law enables employers to wash away the sins of the past and avoid fines and penalties for certain types of technical or procedural errors (which just so happen to be very common in the I-9 world). While a remediation project can be a daunting task, employers can take advantage of automated tools which facilitate the correction process while ensuring compliance with ever-changing rules.

Need more information on Form I-9 penalties and remediation strategies? Please contact us with any questions you might have!


About John Fay

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 President at the LawLogix division of Hyland Software, Inc., where he oversees all aspects of the division’s operations and provides strategic leadership and direction in the development and support of Form I-9, E-Verify, and immigration case management software solutions.

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