In our December 2008 Immigration Alert, we reported that the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council (the Councils) agreed on a final rule implementing a presidential executive order requiring federal contractors and certain subcontractors to use the E-Verify system to confirm the employment eligibility of all newly hired employees and all employees (including existing employees) directly working on federal contracts. The final rule was scheduled to take effect January 15, 2009.

A lawsuit filed by the US Chamber of Commerce on December 23, 2008 sought a court order declaring the final rule illegal and void. For more information, see our January 2009 Immigration Alert. The US Chamber of Commerce negotiated a suspension of the final rule with the Councils until February 20, 2009.

Now, the US Chamber of Commerce and the Councils agreed to extend the effective date of the rule to May 21, 2009 and asked the court to stay proceedings to allow the Obama administration an opportunity to review the rule. The suspension occurs on the heels of a January 20, 2009 memorandum from Rahm Emanuel, President Obama's Chief of Staff, to the heads of all executive departments and agencies stating that the agencies should "[c]onsider extending for 60 days the effective date of regulations that have been published in the Federal Register but not yet taken effect." As a result, any federal solicitations that occur prior to May 21, 2009 will not contain the contract clause that requires government contractors and subcontractors to use E-Verify.