The South Carolina Illegal Immigration Reform Act took effect on July 1, 2009 for private employers with 100 or more employees. All other private employers must be in compliance by July 1, 2010.

The Act prohibits employers in South Carolina from “knowingly or intentionally” employing unauthorized aliens and establishes steps that employers must take to verify the work status of new hires as of the effective date. Employers that violate the provisions of the law will face tough penalties in the form of monetary fines and possible suspension, even permanent revocation, of the ability to employ workers in South Carolina.

South Carolina Department of Labor, Licensing, and Regulation (LLR) is responsible for issuing regulations and enforcing the new law as it applies to private employers. LLR has yet to issue guidance or finalize regulations regarding implementation of the law; however, “proposed” regulations covering the “random” audit process and steps for administrative review are available on LLR’s website.

LLR’s Enforcement Tactics

South Carolina employers should be aware that LLR has hired investigators to conduct audits of employers throughout the state and that they are already conducting “random” audits. These investigators are currently arriving, unannounced, at employer sites requesting to view documentation as evidence that the company is not “knowingly or intentionally” employing any unauthorized workers. The investigators are not requesting just to view documentation to serve as evidence of compliance with the new law’s employment verification requirements as of the effective date, as one would expect, but they are asking to see documentation (including federal I-9 forms) prior to July 1, 2009. The investigators also have been instructed to randomly interview employees.

It is our opinion that LLR’s interpretation of the Act, its application, enforcement mechanisms, and methodology for selecting employers for “random” audits appear to reach beyond the scope of LLR’s legal authority. The agency’s actions raise several serious legal issues including, but not limited to, the violation of federal employment verification laws, the right to privacy, and other constitutional issues.

We recommend that clients use caution in any dealings with LLR or its investigators. Complying with the agency’s demands could potentially create other legal issues and liabilities. We are diligently working towards finding a solution to these unreasonable enforcement tactics and will apprise our clients of any developments.