On August 26, 2009, a U.S. District Court in Maryland cleared the path for the E-Verify requirement applicable to certain federal contractors to go into effect on September 8, 2009. This decision follows several delays of the E-Verify requirement dating to earlier this year. Several plaintiffs, including the U.S. Chamber of Commerce, Associated Builders and Contractors, Inc., Society for Human Resource Management, the American Council on International Personnel and the HR Policy Association, filed suit against the Department of Homeland Security to block implementation of the E-Verify requirement under various constitutional and regulatory grounds. The court rejected the claims and essentially stated that employers that do not want to use the E-Verify system simply can choose not to do business with the federal government.

In light of this ruling, organizations that enter into certain federal contracts beginning on September 8, 2009 will be subject to the E-Verify requirement to ensure that their employees have authorization to work in the United States. Affected federal contracts include prime contracts greater than $100,000 and subcontracts greater than $3,000 for services or construction. The contract will contain a clause confirming the E-Verify requirement. For existing, indefinite-delivery/indefinite quantity contracts, the federal contracting officer is to prepare an amended contract to include an E-Verify clause. Exceptions to the E-Verify requirement are federal prime contracts with performance terms of less than 120 days and contracts for commercially available off-the-shelf (COTS) items.

For additional information on the E-Verify requirements for federal contracts, please see previous posts.