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DHS Paves the Way for Greater E-Verify Enforcement at the State Level

Today, the Department of Homeland Security (DHS) announced that it is now permitting employers in the State of South Carolina to disclose information received from E-Verify to the South Carolina Department of Labor as required by the state’s 2008 immigration law.

Earlier this year, the state had suspended all E-Verify investigations after several employers complained that they could not (under the terms of the E-Verify Memorandum of Understanding) disclose or share any information about their E-Verify transactions or operations.  Feeling emboldened by the US Supreme Court’s decision in favor of the Arizona E-Verify law, Governor Nikki Haley of South Carolina wrote a seething letter directly to Secretary Napolitano in late May, asking that DHS enter into an MOU with the state so that it can enforce its own E-Verify law. According to the Governor’s website, she recently received a letter from DHS stating that they have decided to authorize South Carolina E-Verify employers and their E-Verify Employer Agents to disclose E-Verify information directly to the South Carolina Labor, License, and Regulation (LLR) Department when requested for enforcement actions. Today, many E-Verify employers and E-Verify Employer Agents received an email to the same effect.

While the news itself is not exactly earth-shattering (in fact, I’m sure many SC employers were unaware they previously had a legal basis for denying an audit request), it could be an important sign of things to come as states continue to create their own unique versions of immigration enforcement, most of which are centered around the mandatory use of E-Verify. The South Carolina law in particular has always been one of the nation’s toughest, owing to its full reach (all employers) and penalties for noncompliance.

Let’s take a quick look back at the current SC law, future SC legislation, and the impact for all employers nationwide.

A Look Back at the South Carolina Law

The South Carolina Illegal Immigration Reform Act requires all employers doing business in South Carolina to participate in E-Verify or only hire employees who possess or qualify for a South Carolina driver’s license (or other state license with similarly strict requirements). The South Carolina Department of Motor Vehicles has determined that drivers’ licenses or identification cards issued by the following states are acceptable: AK, AZ, CT, DE, FL, GA, ID, IN, KS, KY, ME (credentials issued after 11/15/08), MD, MA, MI, MO, MT, NH, NJ, NC, PA, RI, TN, TX, VA, WV and WI. For the most current list, visit the DMV Web site here.

Like many E-Verify bills, the law has been implemented in stages, covering state contractors with 500 or more employees on January 1, 2009; state contractors with 100 to 499 employees and private employers with 100 or more employees on July 1, 2009; all state contractors on January 1, 2010; and all employers state-wide as of July 1, 2010. Employers that fail to participate in E-Verify or do not hire only employees that possess or qualify for a South Carolina driver’s license (or other state license with similarly strict requirements) may be fined up to $1,000 for each violation.

According to recent news reports, South Carolina has audited more than 6,000 organizations, identifying 2,206 violations. In most cases, the state has waived the penalty under the law’s first time violation exception as long as the employer begins using E-Verify or otherwise corrects the problem within 72 hours. Although the citations were relatively low in the beginning, the state saw a big uptick when the law became effective for smaller employers in July of last year (particularly those in the hospitality and construction industry).

I am a South Carolina Employer…should I start getting my E-Verify paperwork in order?

Ironically, South Carolina will not be immediately resuming its E-Verify investigations, despite the news from the Governor’s office. Why, you might ask? Well, why start enforcing one immigration law, when you’ve got an even more expansive law coming down the pike! Yes, that’s right, on Tuesday, the South Carolina legislature sent Senate bill 20 to Governor Haley’s desk, which promises to bring even greater scrutiny of employers and individuals residing in the state. Here are some of the key elements of South Carolina’s latest bill as it pertains to employers:

  • All private employers in South Carolina shall be imputed a South Carolina employment license, which can be taken away under certain circumstances
  • There will no longer be the option of accepting a strict driver’s license. All employers must use E-Verify. A private employer who does not comply violates the private employer’s licenses.
  • A private employer who knowingly or intentionally employs an unauthorized alien violates the private employer’s licenses.
  • Upon receipt of a written and signed complaint against a private employer, or upon an investigation initiated by the director for good cause, if the director finds reasonable grounds exist that a private employer violated any of the provisions above, the director shall institute an investigation
  • There will be a grace period of one year for employers, during which penalties will be probationary. After that, employers can face temporary suspension of their business license for hiring unauthorized workers and reinstatement fees after those workers have been fired. On third offense, an employer’s business license can be revoked.

In addition, the bill also requires police to check the immigration status of any individual they have stopped for another reason and also creates a new Illegal Immigration Enforcement Unit within the state police to serve as the liaison between local officers and ICE. Most provisions in the bill would go into effect on January 1, 2012. Preparing for the Future Whether you’re a South Carolina employer or not, the odds are that someday you may need to present your E-Verify data to a government agency that is checking up on your organization. In South Carolina, employers were balking at this request, primarily due to one section of the MOU (Article II.C.13) which reads:

“The Employer agrees that it will use the information it receives from SSA or DHS pursuant to E-Verify and this MOU only to confirm the employment eligibility of employees as authorized by this MOU. The Employer agrees that it will safeguard this information, and means of access to it (such as PINS and passwords) to ensure that it is not used for any other purpose and as necessary to protect its confidentiality, including ensuring that it is not disseminated to any person other than employees of the Employer who are authorized to perform the Employer’s responsibilities under this MOU, except for such dissemination as may be authorized in advance by SSA or DHS for legitimate purposes.” (emphasis added).

In today’s email, however, the DHS states that it has “determined that the South Carolina Department of Labor, Licensing, and Regulation’s audits of employers using the E-Verify system constitute such a legitimate purpose. Therefore, South Carolina Employers and their E-Verify Employer Agents can now release E-Verify information, respective to their own, internal employees, in response to an inquiry from an LLR official.”

What type of data will I need from E-Verify?

While this may vary from state to state, you may only need to produce a summary report which lists the employee’s name, the E-Verify transaction, and the ultimate result. In today’s email, the DHS recommends generating the “E-Verify User Audit Report” from the web interface and then deleting the fields which are not necessary. I’m not personally a fan of deleting data (even from a report) because it can be a very slippery slope when you later need to present that to an investigative unit.  Fortunately, employers using a well-designed electronic I-9 system will be able to generate their own report on the fly which contains the exact data needed to meet specific state requirements. Using a secure system also helps ensure that you’re employing reasonable safeguards when generating, sharing or storing the always-sensitive information from E-Verify.


As Web Services E-Verify Agents, we receive a lot of emails and correspondences from DHS (which is a testament to their great outreach and education initiatives). At first glance, I thought this was just another service announcement – useful, but not critical. I realize now it’s much more than that. As states across the nation continue to pass E-Verify and immigration bills at an alarming rate, access to E-Verify data will become more and more critical to real enforcement – something we haven’t seen on the E-Verify front as of yet. A door was just opened today…ever so slightly, and it will be very interesting to see how widely and swiftly the states will march right through it.

Human Resources Today