On July 1, 2009, U.S. Immigration and Customs Enforcement (ICE) announced that in an unprecedented operation, more than 652 businesses nationwide will be issued Notices of Inspection (NOIs), which is more than the agency issued for the entire previous fiscal year.

The ICE press release seems to reflect an initiative by ICE to step up stricter enforcement of employment and immigration laws to prevent illegal hiring of immigrants and to help protect jobs for the U.S. work force.

If your business is issued an NOI, the most effective response is to conduct an internal audit or hire an outside firm to do so as soon as possible. However, you should immediately contact your employment or immigration law counsel before taking any further action. You need not wait until your receive an NOI to conduct an internal audit, as noted in this advisory.

An internal audit will help uncover and correct omissions or oversights on I-9 Employment Eligibility Verification forms and bring your company in compliance with the Immigration Reform and Control Act (IRCA). In correcting an I-9 form, all missing information should be conspicuously inserted, initialed and dated contemporaneously with its addition. While mistakes, oversights and omissions discovered on an I-9 form cannot be retroactively corrected, future violations may be prevented by taking corrective actions now and implementing enhanced I-9 completion policies internally. Such actions may also show a good-faith effort to correct oversights and comply with the law.

Following are a few points to keep in mind and help guide you in ensuring compliance with IRCA.

Practical tips to avoid I-9 compliance problems

  • New I-9 form must now be used. The newly revised I-9 form went into effect on April 3, 2009. The I-9 form with the revision date of Feb. 2, 2009, (Rev. 02/02/09) printed on the lower right-hand corner of the form must now be used for all newly hired employees.
  • I-9 compliance program. Employers should have a compliance program in place. This means that they must complete an I-9 form for all employees hired after Nov. 6, 1986. Copies of the I-9 form and any supporting documentation should be maintained in a separate file where all I-9s are kept. Employers must ensure that the forms are properly completed by both the employee and the employer.
  • Periodic self-audits. Employers should consider conducting periodic voluntary audits of their immigration compliance practices. In light of the complexity and newness of many immigration regulations, both ICE and the U.S. Department of Labor (DOL) may exercise leniency toward an employer who has conducted a voluntary immigration audit. Employers are encouraged to utilize neutral third parties, preferably with expertise in immigration law, to carry out internal audits, in order to give employees and outsiders an accurate impression of the company’s intention to comply with applicable immigration laws. If possible, the audit should be broad, to ensure uniformity, and should concentrate on areas that traditionally cause employers the greatest difficulty, including I-9 documentation.
  • Nondiscrimination. Employers must stress a nondiscriminatory approach to compliance with the law. Applicants cannot be discriminated against because of foreign appearance, accents or names, which would violate Title VII. Applicants can be informed that, as a condition of employment, they will have to provide documentation to prove employment eligibility and identity. Employers may state this fact on notices in their personnel offices and on their employment application forms. If a new hire does not have the required verification documents, he/she may be given up to three business days to obtain them. If the new hire still needs more time, he/she may be given up to 90 days upon providing evidence of having requested the documents within three days of being hired. If the employee does not provide the proper documentation within 90 days, he/she should be terminated. Keeping in mind the ban on discrimination, employers should not adopt any occupational qualification unless they can demonstrate that the requirement is job-related.
  • Abuse of undocumented workers. Employers should be aware that DOL and the U.S. Department of Justice (DOJ) have entered into a joint memorandum of understanding designed to encourage undocumented alien workers to file complaints regarding wage/hour, safety or other workplace abuse. Under this agreement, federal agents who investigate certain workplace practices (based on employee complaints) will not review the employer’s I-9 forms as part of the inspection. The agencies state this procedure is targeted at the “source of illegal immigration—unscrupulous employers that exploit undocumented workers.” Undocumented workers may hesitate to protest unfair or unsafe working conditions if they fear that review of the I-9 forms would lead to deportation. The agencies will continue to inspect I-9 forms where the investigation is initiated by the agency rather than by employee complaints.

Enforcement

  • Inspection of I-9 forms. ICE has the right to inspect an employer’s I-9 records and to request administrative law judges to issue subpoenas to compel the production of documents. Employers are entitled to three days’ notice before an inspection. Legal counsel should be contacted immediately upon receipt of an audit notice. Usually, the I-9 forms are reviewed in the first instance by compliance officers from the Wage & Hour Division of the DOL and auditors from the Office of Federal Contract Compliance Programs during their audits. Violations disclosed during such audits will be provided to ICE for a full investigation.
  • Notice of fines. ICE must provide an employer with a notice before it imposes a penalty or other sanction. An employer that receives a notice of violation must request a hearing within 30 days of the date of the notice in order to preserve its right to appeal. Because of the possibility of substantial monetary penalties and the short time for appeals, legal counsel should be contacted immediately upon receipt of a notice of violation.
  • Civil penalties. Penalties may be imposed for hiring or continuing to employ an unauthorized alien, as well as for failing to properly complete the I-9 form. Civil penalties may also be assessed for violation of the nondiscrimination provisions. Some of the penalties were adjusted for inflation and increased by 25 percent in February 2008.

First violation: $375-$3,200 per unauthorized alien

Second violation: $3,200-$6,500 per unauthorized alien

Third violation: $4,300-$16,000 per unauthorized alien

Failing to complete the I-9 form may result in a penalty of $110-$1,100 per individual

  • Injunctions and/or criminal penalties. A pattern or practice of hiring or continuing to employ illegal aliens may result in injunctions and/or criminal penalties ($3,000 per unauthorized alien and/or six months’ imprisonment, without regard to the number of aliens, and five years’ imprisonment for persons who knowingly hire more than 10 illegal aliens within a 12-month period).
  • Violation of nondiscrimination provisions. Nondiscrimination violations may result in a fine of $250-$10,000 per person, and document abuse may result in a fine of $100-$1,000 per person.
  • Other remedies. Other remedies available to enforce IRCA include cease-and-desist orders, orders requiring compliance with verification procedures and other remedial orders. Multifacility employers must be particularly concerned about the progressive penalties under IRCA. For purposes of counting prior violations, separate locations of an employer will be considered separately if they are individually responsible for hiring without reference to the practices of, and not under the common control of, other locations.
  • Personal liability of company managers. Personal liability of corporate officers and managers will also be an issue under IRCA, but it is unclear at what level of corporate organization or management DOJ will seek to impose civil or criminal liability. In light of this, written information and instructions from top-level management to local management and all individuals with hiring authority are strongly recommended.
  • Penalties for discrimination. Discrimination prohibited by IRCA is subject to proceedings before an administrative law judge brought by a DOJ special counsel or, in certain cases, by the individuals themselves. In addition to the civil penalties mentioned above, sanctions may include remedial hiring, back pay awards, attorneys’ fees and other relief.

Defenses

  • Good-faith compliance with I-9 procedures. Good-faith compliance with the I-9 verification and record-keeping requirements is an affirmative defense to charges of improper hiring, recruiting or referring for a fee. A presumption of good-faith compliance can be rebutted through proof that the employee’s documents did not reasonably appear on their face to be genuine, that the verification process was pretextual or that the employer colluded in falsifying documents.
  • Correction of technical mistakes. Under new rules enacted as part of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRAIRA), employers who have made a good-faith effort to comply with the I-9 employment verification requirements in effect at the time new employees are hired are considered to have complied with the requirements even if there is a technical or procedural failure to meet the requirements. To benefit from this new and more flexible standard, employers must correct the failure. This only applies if ICE or another enforcement agency explains the basis for the failure to the employer, provides not less than 10 business days within which to correct the failure, and the employer corrects the failure. This provision does not apply to employers who engage in a pattern or practice of violations.