Successfully Implementing Tennessee’s E-Verify Law

[Editor’s Note: Today’s blog is authored by Bruce E. Buchanan, an Attorney at the Nashville Office of Siskind Susser, P.C.]

The last phase of the Tennessee Lawful Employment Act (TLEA) takes effect January 1, 2013. The law is rather unique because an employer may enroll and use E-Verify for newly-hired employees, OR it may accept, copy and maintain a state-issued driver’s license or identification, unexpired U.S. passport, permanent resident card, work authorization, birth certificate, certificate of naturalization, or a few other forms of identification from newly-hired employees. It is essentially a non-mandatory E-Verify law. The TLEA will become effective for almost all Tennessee employers, those with six to 199 employees beginning January 1, 2013. Employers with five or fewer employees are exempt from the law. Previously, the Act was effective for employers with 500 or more employees and governmental entities on January 1, 2012 and employers with 200 to 499 employees on July 1, 2012.

Unlike other state E-Verify laws, the TLEA is distinct in three different ways.

First, the TLEA’s list of acceptable documents for I-9 verification appears to reiterate what federal law already requires. However, the difference is that the TLEA requires employers to maintain copies of the I-9 documents. Under the Immigration Reform and Control Act (IRCA), an employer is not required to maintain copies of the I-9 documents.

Second, a unique provision in the law involves a “non-employee” providing labor or services to an employer. A “non-employee” is defined as “any individual, other than an employee, paid directly by the employer in exchange for the individual’s services.” If an employer contracts with an individual/non-employee, it must request and maintain a copy of one of the specified documents, such as state-issued driver’s license or identification. However, a subcontractor, who is not an individual, is not covered by this provision under the definition of non-employee.

Third, any employer can hire a third party agent to conduct E-Verify checks. Employers, who can attest to lack of Internet access, may enter into agreement with a designated agent to verify new employees through the E-Verify program at no cost to the employer.

An employer has a “safe harbor” if it utilized E-Verify and received a confirmation, or the employee appealed the tentative non-confirmation and the appeal had not been resolved. Thus, it will not be found to have violated the law. This “safe harbor” is not available for employers who copy and maintain an employee’s driver’s license or other identification if the employee is found to be working without employment authorization. The TLEA is administered by the Tennessee Department of Labor and Workforce Development (TDLWD). It will investigate complaints filed with the Department by any lawful resident of this state or employee of a federal agency. If the TDLWD determines the complaint contains satisfactory evidence of a violation, it shall conduct an inquiry. When conducting an inquiry, the TDLWD provides written notification to the employer of the alleged violation and a request for documentation establishing compliance with the Act. The employer must provide such documentation to the Department within 30 days from the date the employer received the Department’s request. After the documentation is submitted, the TDLWD must determine whether there is “clear and convincing evidence of a violation.” If so, the TDLWD shall issue an initial order stating the penalties that will apply if a final order is issued. Furthermore, it provides the process to request a contested case hearing.

An employer has the right to appeal an initial order within 30 days to an administrative hearing. An employer violates the law by failing to receive E-Verify confirmation or to request and maintain a copy of one of the specified identification documents. The TDLWD shall issue a warning in lieu of all penalties for a first violation if the employer complies within 60 days of the initial order and it is determined it was not a knowing violation. The penalties under TLEA are:

• First offense – $500 penalty + $500 per employee or non-employee not verified or copy of documentation maintained

• Second offense – $1,000 penalty + $1,000 per employee or non-employee not verified or copy of documentation maintained

• Third offense – $2,500 penalty + $2,500 per employee or non-employee not verified or copy of documentation maintained.

If the employer fails to submit documentation of compliance, the TDLWD shall request an order requiring the appropriate local government with respect to business licensure to suspend the employer’s license until the employer remedies the violation. If there are subsequent offenses, the business license is suspended for one year. Given the option, Tennessee employers with six or more employees who enroll in E-Verify may benefit from the safe-harbor provision of the TLEA.

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Bruce E. Buchanan is an Attorney at the Nashville Office of Siskind Susser, P.C. He represents individuals and employers in all aspects of immigration law, with an emphasis on employer immigration compliance, as well as employers in employment/labor law matters. He serves as Chair of the Tennessee Bar Association’s Immigration Law Section from 2011 to 2012 and has been the editor of the TBA’s Immigration Law Section Newsletter and the TBA’s Labor and Employment Law Section Newsletter since 2009. Mr. Buchanan also serves on the Board of Directors for the Nashville International Center for Empowerment (NICE) and the United Cerebral Palsy of Middle Tennessee and Middle Tennessee Seminole Club. He is an associate member of the Mid-Tennessee Chapter of the Associated Builders & Contractors (ABC). Sponsored by ABC, Tennessee employers can attend Mr. Buchanan’s upcoming E-Verify Seminar on November 28, 2012 from 8:30-10:30 am (EST) by registering here.