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Discrimination Settlement Highlights the Risks of Non-Compliant Electronic I-9 Software

Approximately five years ago, the Department of Justice made a small regulatory change that increased the risks of an I-9 related discrimination suit for employers – especially as it turns out, for employers using bad electronic I-9 systems.

Specifically, the DOJ clarified that discrimination in the I-9 context means the act of intentionally treating an individual differently based on national origin or citizenship status, regardless of the explanation for the differential treatment, and regardless of whether it is because of animus or hostility.

Practically speaking, this means an employer can commit an “unfair documentary practice” (a big no-no in the I-9 compliance world) based simply upon their misunderstanding of I-9 requirements and procedures…or even worse, their vendor’s or software programmer’s misunderstanding or improper design of an electronic I-9 system that perpetuates an improper I-9 practice.

Now wait a minute, you say. Isn’t the whole idea behind an electronic I-9 system to reduce I-9 compliance risks by eliminating errors, standardizing processes, and increasing overall onboarding efficiency? Yes, you are quite correct, my well-educated and completely fabricated friend.

But the problem is that the government does not certify, review, or otherwise approve electronic I-9 systems that are available in the marketplace. Instead, they take the position that employers are ultimately responsible for the software they select (or even create) – a policy that has ultimately led to a wide variety of non-compliant electronic I-9 software applications.

Fortunately, many employers these days are well-aware of the regulatory requirements relating to electronic I-9s – the audit trails, electronic signature steps, and other safeguarding measures specified by the government.

But as it turns out, that’s only half the story. Because employers also need to ensure that their system of choice follows all of the bedrock I-9 rules, including the prohibition of discriminating against a work-authorized individual based on the person’s citizenship, immigration status, or national origin.

This brings us to the subject of today’s blog – a somewhat recent DOJ settlement agreement entered into by a large health care organization that highlights the dangers of using an electronic I-9 platform that ignores the rules and consequently “goes too far.”

The Investigation

The DOJ, through its Immigrant and Employee Rights Section (IER) began an investigation into Ascension Health Alliance, a Missouri-based health care organization with more than 2,600 sites – including 146 hospitals and more than 40 senior living facilities – in 19 states and the District of Columbia.

According to the settlement agreement, IER discovered that from at least January 1, 2018 to April 30, 2020, Ascension used a custom-made electronic I-9 platform that improperly sent e-mails requesting updated work authorization documentation to all non-U.S. citizen employees, in advance of the expiration date recorded on their I-9.

The impacted non-citizens included U.S. nationals, lawful permanent residents, asylees and refugees. IER also found that the system sent these reverification emails even in situations when the documents that had previously been presented DID NOT require reverification (e.g., an I-551 green card).

IER also alleged that in some instances, Ascension further required non-U.S. citizen employees to present new documents in order to continue working.  In contrast, the company did not program the software to send e-mails to U.S. citizens to notify them near the expiration of their documents (thus forming the basis for the discrimination claim).

The Law

As many employers are aware, many non-U.S. citizens, including lawful permanent residents, refugees, and asylees, among others, have work authorization that does not expire, and are eligible for several of the same types of documents as U.S. citizens (such as driver’s licenses and unrestricted Social Security cards) to prove their work authorization. Requiring these individuals to present specific additional documentation (even if done innocently or by accident) is considered an unfair documentary practice, which can subject an employer to penalties and fines.

The Settlement

And that’s exactly what happened here as well – according to the settlement agreement, Ascension has agreed to pay a civil penalty of $84,832 for its unlawful document requests. The company must also train its employees on the requirements of the INA’s anti-discrimination provision and be subject to monitoring for a three-year period to ensure they are complying with the agreement.

The settlement agreement goes even further though, requiring Ascension to ensure initial and ongoing training of any individual(s) responsible for supervising their technology vendor – i.e., the organization that programs and maintains their electronic I-9 software. Presumably here, IER wants to make sure that the company is keeping compliance top of mind when implementing and/or overseeing software updates in the future.

Lessons Learned 

Employers using electronic I-9 systems need to conduct their own due diligence, preferably working with experienced immigration counsel, to ensure that their I-9 system of choice is programmed correctly and not opening them up to even greater risks from the various government agencies.

As part of this process, organizations should perform a top to bottom evaluation of their electronic I-9 system, paying special attention to how they typically inform employees of the documents required for I-9 verification. In doing so, they may also want to review their I-9 forms and look for any instances where they may have improperly requested documentation or employed a special procedure for non-citizen employees.

Lastly, organizations must commit to making any needed changes as soon as possible, which may involve switching vendors and/or using a different electronic I-9 application.  Staying the course should never be the default option, especially when one considers the considerable I-9 risks of doing nothing.

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Have questions on today’s blog? Please drop me a line here. You can also contact us to learn more about our electronic I-9 and E-Verify platform, Guardian, which was designed by attorneys to compliantly help organizations streamline and standardize their hiring practices.


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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