Since January, with the advent of a new Administration, U.S. employers have begun encountering increasingly hostile treatment at the hands of Executive Branch officials who administer and enforce America’s immigration laws. This memorandum will describe new developments in immigration enforcement and provide answers to questions that many employers are asking.

In recent months, the U.S. Department of Homeland Security (DHS) has dramatically changed the immigration enforcement policy of the Bush Administration. Under the direction of Janet Napolitano, the DHS Secretary appointed by President Obama, the Department has redeployed its resources by focusing an unprecedented level of resources and energy on the investigation of employers for immigration-related law violations.

On July 1, Secretary Napolitano announced that over 650 businesses had received notices of audit and that employers who engage in serious violations of the immigration and labor laws will face civil and criminal prosecution. As reported in The Wall St. Journal on August 18 (“U.S. Intensifies Audits of Employers”), John Morton, the head of U.S. Customs & Immigration Enforcement (ICE), the enforcement arm of DHS, announced:

“You are going to see audits regularly and on a larger scale,” Mr. Morton said during a two-day visit to Southern California, his first since being appointed four months ago. “You will see the resuscitation of...civil fines.”

In addition, employers across the country have reported recent surprise visits by another DHS unit, the Fraud Detection and National Security division (FDNS) of U.S. Citizenship and Immigration Services. FDNS officers and private detective agencies retained by FDNS have visited employer worksites in order to verify that information submitted in petitions and applications for immigration benefits matches the actual terms and conditions of the sponsored foreign workers’ employment. To add to the enforcement emphasis, just last week, Hilda Solis, the new Secretary of the Department of Labor (DOL), announced that the DOL unit (the Wage and Hour Division) that investigates immigration-related labor law violations will increase its ranks by an additional 150 investigators.  

Employers must prepare for immigration-related worksite inspections by developing and implementing robust compliance policies, auditing their I-9s and H-1B public access files, and putting plans in place for responding when immigration agents come calling.

Why Should Employers be Concerned?

As noted, ICE has announced that it will be operating under an updated worksite enforcement strategy: “ICE will focus its resources in the worksite enforcement program on the criminal prosecution of employers who knowingly hire illegal workers in order to target the root cause of illegal immigration.” The new strategy reflects a strong focus on prosecution of employers who hire “illegal workers,” with a more humanitarian attitude toward the unauthorized workers who may be arrested during worksite enforcement operations. The new policy on apprehending unauthorized workers, dubbed by some immigration lawyers as “catch, tag and release,” allows for the grant of employment authorization as an inducement to report immigration violations committed by their employers.  

Additionally, FDNS has begun using the substantial pool of collected “fraud detection and prevention fees” (a $500 fee collected each time an employer files a new H-1B or L-1 work visa petition for a nonimmigrant employee) as well as funds generated from its July 2007 filing-fee increase to expand substantially the number of random, unannounced worksite visits to employers who file petitions for nonimmigrant workers.

Which Employers Should be Concerned?

All employers with U.S. operations should be prepared for the possibility of immigration-related government audits. Businesses in industries with historically high numbers of unauthorized workers, such as construction, food services and hospitality, should be particularly alert to these new enforcement tactics, including Form I-9 (Employment Eligibility Verification) notices of inspection.  

In additions, all employers filing petitions for nonimmigrant workers, particularly those who sponsor H, L, R, and TN workers, should prepare for random investigations.  

Even employers in industries not previously targeted may be at risk.  

What Steps Should Employers Take to Prepare for Immigration Investigations?

Employers should begin by designating an immigration compliance officer and implementing an investigation response plan. The response plan should instruct receptionists and other front-office staff that they have no authority to consent to a site inspection and instead to contact the organization’s designated officer if a government official or contractor shows up and asks to see immigration paperwork or talk to employees. Immediately upon learning that a government representative is on site, the designated compliance officer should contact the company’s in-house legal department and outside immigration counsel and follow their advice. In addition, employers should determine, in advance, the amount and type of information that they will provide, if any, to government investigators without a warrant.

The inspectors typically use a script of standard questions that compare the facts stated in the work visa petitions submitted by the employer with the “facts on the ground,” and often will ask to speak with both an employer representative and foreign workers. The company’s immigration compliance officer and the foreign workers should never respond to the scripted questions solely from memory or with “ballpark” answers. Deviations from circumstances stated in the visa petitions and immigration paperwork—unless reasonably and of course truthfully explained—may lead to follow-up investigations and possibly serious enforcement actions.

The best way to prepare for immigration investigations is to determine if improper activity has occurred. Employers should ensure that all required immigration documentation is retained properly in an organized fashion and should undertake internal audits of their immigration compliance practices, such as I-9 and H-1B Public Access Files. They should never turn over original documents without first getting advice and approval of counsel, making a complete copy, insisting on learning the identity and contact information of the investigator, and obtaining an itemized receipt.  

What Does the Stepped-Up Immigration Enforcement Mean for My Business?

Today, penalties for violations of federal and state immigration rules extend beyond costly civil fines; they also include imprisonment, asset forfeiture, and debarment from government contracting and from sponsorship of additional foreign workers. Executives, business managers, human resources staff members, worksite supervisors, and union stewards all face potential civil and criminal liability for failure to abide by the immigration laws.

Stepped-up enforcement means that employers are more likely than ever to be investigated and/or audited by ICE, FDNS or the DOL. If employers have not already prepared for the possibility of an investigation and enforcement action, they should begin such preparations immediately.

What Should My Company Consider in Preparing for ICE I-9 Inspections?

Employers are encouraged to be proactive in their preparations for ICE’s new enforcement strategy. To avoid hiring unauthorized workers (and potentially becoming tomorrow’s headline), there are numerous steps employers can take. These include: providing I-9 training to human resources; implementing an electronic I-9 program; undergoing a voluntary I-9 audit; using the federal government’s E-Verify system; implementing a Social Security no-match policy and a comprehensive immigration compliance policy; and ensuring the proper use of, and immigration compliance by, subcontractors.

Electronic I-9 Creation and Storage: A number of vendors now offer sophisticated Form I-9 compliance software packages that prevent errors before they risk exposing an employer to expensive fines. These electronic I-9 systems maximize accuracy in completion of the form and allow for electronic signature and storage of I-9 forms and documents confirming employment authorization and identity. They also include “tickler systems” to notify the employer before a worker’s employment permission must be re-verified. These I-9 software systems also enable the scanning and indexing of existing I-9s so that the required immigration paperwork for the employer’s entire workforce is maintained electronically and readily accessible in case of government audits or enforcement actions.

Voluntary I-9 Audits: All organizations should conduct internal I-9 reviews on a regular basis before government immigration agents come knocking on their doors. But a mere internal audit, without professional legal guidance, may not yield the best results. Your legal counsel should review your I-9s and evaluate errors across a list of more than 30 potential problem areas and should then make recommendations for I-9 corrections.

I-9 Compliance Training: Employers should seek legal counsel to train recruiters, human resources professionals, and managers to identify and avoid the many pitfalls involved with completing, maintaining, and re-verifying the company’s I-9 forms.

Social Security Administration “No-Match” letters: Employers must ensure that key personnel in payroll and HR know what they must do when responding to SSA “No-Match” letters. Employers must also understand under what circumstances they must or should terminate an employee. Immigration and employment law counsel should be consulted to provide employers with guidance in this confusing area and to help employers avoid negative publicity, brand damage, and lost profits.  

Guidance on State Immigration/Workplace Enforcement Laws: There are now more than a dozen states with their own immigration/workforce compliance laws and over 1,000 immigration-related bills were introduced in the states in the first quarter of 2009. Employers should check with their local HR trade groups, chambers of commerce, or lawyers for guidance on state-law immigration compliance concerns.

Opting-in or Declining E-Verify Participation: Employers should consider the benefits and disadvantages of this government-run online system for employment verification. Some employers may be required to use the system, either nationwide or on a state-by-state basis. Others may want to voluntarily enroll in the system for the peace of mind it provides or as a recruiting tool for F-1 students in fields of Science, Technology, Engineering, or Math (STEM students) who may benefit from up to 29 months of work permission (optional practical training) if employed by a company that uses E-Verify. Employers should check with their local HR trade groups, chambers of commerce, or lawyers for guidance on E-Verify concerns.