First there was the Immigration Reform and Control Act of 1986 (“IRCA”), which mandated that all U.S. employers complete a Form I-9 and review documents provided by the employee within three days of hire.  Eleven years later, the system now known as “E-Verify” was created to allow participating employers to confirm an individual’s employment eligibility electronically – and often instantaneously - by entering data gathered during the I-9 process.

Up until recently, participation in E-Verify was almost universally voluntary.  However, that began to change when the Arizona legislature passed its controversial law that in part required all employers in that state to screen new hires through E-Verify.  After the Arizona statute was upheld by the United States Supreme Court earlier this summer, several states and even some municipalities have considered, and in some cases passed, similar requirements that would mandate the use of E-verify and significantly penalize the employment of unauthorized workers.

Now comes the Legal Workforce Act (H.R. 2164), a bill sponsored by House Judiciary Committee Chairman Lamar Smith.  This bill would (among other things):

  • Mandate the universal use of a new Employment Eligibility Verification System ("EEVS") for new hires through a “gradual phase-in.”  Businesses having more than 10,000 employees would be required to use EEVS within six months of the bill’s enactment.  After that, a new group of employers would be required to use EEVS every six months, with businesses having 1 to 19 employees coming under the obligation at the second anniversary of the enactment.
  • Generally preempt state laws mandating EEVS use for employment eligibility purposes.  However, states and localities could continue to condition business licenses on the requirement that the employer use EEVS. 
  • Create a safe harbor for employers.  Generally, employers would be protected from prosecution if they use EEVS in good faith, and through no fault of their own, receive an incorrect eligibility confirmation.
  • Increase (between 2 and 10 times) fine amounts, with a possible waiver or reduction for violators who establish that they acted in good faith.
  • Create a rebuttable presumption of having knowingly hired (or recruited or referred for a fee) an unauthorized alien if the alien remains employed after a final non-verification is issued by EEVS.    

As would probably be expected, while the bill has its supporters, there are some who argue that the bill isn’t tough enough, and others who strongly oppose the legislation arguing, in part, that it would materially harm the U.S. economy.

While the hospitality industry has previously been concerned with the labor cost implications of mandatory E-Verify participation, that position may be changing with the emergence of patchwork regulation.  As stated by a National Restaurant Association representative during his testimony before a House Judiciary Subcommittee:   

The National Restaurant Association believes that designing an employment authorization verification system is a federal role. Actions by 50 different states and numerous local governments in passing employment verification laws create an untenable system for employers and their prospective employees. . . .  [N]otwithstanding the few clarifications and minor changes needed, the Legal Workforce Act reaches the right balance with a system that is both fast and workable for businesses of every size under practical real world working conditions.

While it is completely understandable that employers who operate in more than one state would prefer one uniform national verification system over the incredible burden of complying with differing state requirements, bringing all employers and job seekers into the fold within two years will be an enormous and expensive undertaking for the federal government and for businesses.  Also, implementing a nationwide program without first addressing the underlying flaws in our immigration system that allowed the number of unauthorized workers to climb into the millions will only serve to exacerbate the predicament.