Form I-9 is used for verifying the identity and employment authorization of individuals hired for employment in the United States. All U.S. employers must ensure proper completion of Form I-9 for each individual they hire for employment in the United States. This includes citizens and non-citizens. Both employees and employers (or authorized representatives of the employer) must complete the form. On the form, an employee must attest to his or her employment authorization.
The employee must also present his or her employer with acceptable documents evidencing identity and employment authorization. The employer must examine the employment eligibility and identity document(s) an employee presents to determine whether the document(s) reasonably appear to be genuine and to relate to the employee and record the document information on the Form I-9.
Is Your Business Prepared an Audit- Form I-9 Nightmare?
Introduction- What is an I-9 Form
Form I-9 is used for verifying the identity and employment authorization of individuals for employment in the United States. Pursuant to the 1986 Immigration Reform and Control Act, all U.S. employers are required to verify the identity and work eligibility of all employees hired after November 6, 1986, whether those employees are U.S. citizens or not. Both employees and employers (or authorized representatives of the employer) must complete the form.
The I-9 Audit and Enforcement
Immigration and Custom Enforcement (ICE) audits begin with a visit by Homeland Security Investigations (HSI), the agency enforcing the I-9 compliance requirements. If I-9 violations are discovered, civil fines for simple paperwork errors-even of no undocumented workers are discovered-will range from $110-$1,100 per I-9 Form depending on a number of factors. Penalties for knowingly hiring or continuing to hire undocumented individuals range from $375 to $16,000 per individual. The company owners, managers and human resources professionals can be held criminally liable.
When an employer becomes the subject of an ICE audit, it will be served with a Notice of Inspection (NOI). The most recent NOI template request includes a number of items separated in two groups:
Documents that must be provided within 72 hours:
- The original and a copy of all Forms I-9 subject to retention ( all active employees and all terminated within 1 years or hired within 3 years, whichever is longer) as well as copies of any document copies retained and copies of E-Verify or other verification.
- Employee roster/spreadsheet;
- Completed company survey provided by HSI that includes questions relating to the company’s I-9 practice, organizational structure, financial status, and use of leased employees or contractors. HSI typically also requests the name of software being utilized and copies of internal business practices/protocols related to the use of such software.
HSI will typically provide an extension of at least one week to the employer to provide the following items:
- Forms UCT-6 for three years;
- Payroll reports for three years;
- Copies of W-4 forms;
- A list of independent contractors utilized and copies of all form 1099 issued in the past year. Even though independent contractors are generally not required to complete the Form I-9, federal law prohibits hiring contractors knowing that they are not authorized to work.
- A list of all staffing agencies utilized in the past year and a list of all temporary workers employed through such agencies.
Following the submission of the above documents, HSI will determine whether suspected unauthorized workers are being employed and if so, it will issue a Notice of Suspect Documents or Notice for Discrepancies. The employer will have reasonable amount of time to resolve such employees’ work-authorization status or to terminate them. If any technical violations are present, the employer will be issued a Notice of Procedural Violations, allowing the employer 10 days to correct them without a fine.
Recent OCAHO (Office of the Chief Administrative Hearing Officer) Decisions
Based on recent OCAHO ( Office of the Chief Administrative Hearing Officer) decisions, ICE will return for a repeat inspection, even if they audited the employer during the same calendar year. In addition, according to OCAHO, E-verify does not provide a blanket protection for I-9 liability. On March 26, 2014, in U.S. v. Employer Solution Staffing II, LLC, OCAHO held that E-Verify does not exempt the employer from the requirement to promptly complete a Form I-9. Further, proper use of E-Verify only establishes a presumption that the employer is not knowingly hiring unauthorized workers. The employer can still be liable if it had actual or constructive knowledge of the workers’ unauthorized status. Lastly, OCAHO found the employer to have “knowingly” employed an unauthorized worker because that employee had told his employer that he was unauthorized. Further, even though a number of the employer’s forms I-9 had been destroyed or damaged, the employer should have prepared substitute forms, without backdating anything, as well as a memorandum explaining the circumstances.
Employee vs. Independent Contractor.
Employers are not required to complete Form I-9 for independent contractors. However, simply calling someone an independent contractor does not necessarily make them an independent contractor under the Form I-9 employment eligibility verification and employer sanctions laws. In fact, the Department of Labor (DOL) believes that “most employees classified as independent contractors are actually employees and are required to fill out an I-9 form. The definition of an independent contractor depends on a series of factors as related to the employer’s control and the manner in which the work is to be performed. These factors include:
- Whether the employee is salaried or non-salaried;
- Whether the employee is working on the employer’s premises;
- The number of days a year the employee works on the employer’s premises;
- Whether the employer or the independent contractor is paying the worker;
- Whether the employer or independent contractor provides the equipment the worker uses;
- The extent to which the employer’s managers have day-to-day supervision over the worker and elements of control over the that work;
- Whether the independent or subcontractor provides its own on-site supervision;
- Whether the employee does assignments almost exclusively for the employer.
Classifying a worker as an independent contractor, the employer could still be subject to penalties for failure to fill out an I-9 Form, if it is determined that the worker is actually an employee.
As the crackdown on employers continues, is imperative for employers and their counsel to be aware of the latest trends and requirements relating to I-9 compliance in order to ensure that they are ready to face ICE agents and produce the required documentation in the event of an enforcement audit.
U.S. law requires companies to employ only individuals who may legally work in the United States – either U.S. citizens, or foreign citizens who have the necessary authorization. This diverse workforce contributes greatly to the vibrancy and strength of our economy, but that same strength also attracts unauthorized employment.
E-Verify is an Internet-based system that allows businesses to determine the eligibility of their employees to work in the United States. E-Verify is fast, free and easy to use – and it’s the best way employers can ensure a legal workforce.
LCA/ Public Access File Compliance
In connection with the sponsorship and employment of an H-1B worker, USDOL requires employers to make certain attestations to ensure the working conditions of similarly employed workers will not be adversely affected. These attestations are captured on a Labor Condition Application that must be certified by USDOL and signed by the employer before the employer files any petition for H-1B approval. USDOL further requires employers to post the Labor Condition Application in two conspicuous places at the actual location(s) of employment for ten consecutive working days. Alternatively, employers can post a notice that contains certain information from the Labor Condition Application, including the number of H-1B workers being sought, the occupational classification in which they are being sought, the period of employment requested, the wages to be paid, the location(s) at which the H-1B workers will be employed, and information where complaints of misrepresentation and/or noncompliance can be made.