Since 1986, federal law has required that virtually every employer incorporate the now-familiar I-9 form into its new-hire personnel practices. See 8 U.S.C. § 1324a(b). In its current state, the I-9 form includes three sections. Section 1 requires the employee to provide his or her name, address, and date of birth. The employee must also certify whether he or she is a citizen, noncitizen national, lawful permanent resident, or an alien temporarily authorized to work in the United States. Section 2 requires that the employer examine certain documents sufficient to establish the employee’s identity and work authorization and note information about these documents, including title, issuing authority, and expiration date. An employer representative must also certify he or she has examined the documents and that the documents appear genuine on their face. In addition, the representative must include the employee’s hire date and attest that, to the best of his or her knowledge, the employee is authorized to work in the United States. Employers must complete section 3 when an employee’s temporary work authorization expires during the term of his or her employment. Although employers must complete the I-9 form, federal law does not require them to file or otherwise submit the form; they must simply retain it as part of their records.
For two decades, employers completed and maintained the I-9 in paper form. In July 2010, however, the Department of Homeland Security (DHS) issued a final rule permitting both electronic completion and storage of the I-9. See 75 Fed. Reg. 42757 (July 22, 2010) (codifiedat8 C.F.R. § 274a.2). Although employers are still permitted to complete a hard-copy I-9 and store it in paper form, they now have the option of (1) completing a hard-copy form and storing it electronically (e.g., PDF), (2) electronically completing the form and storing it in hard copy (e.g., print-out), or (3) both completing and storing the I-9 electronically. Although electronic storage may make it easier for governmental agencies to audit I-9 forms, it also provides numerous benefits to employers, including eliminating the burden, cost, and inconvenience associated with paper storage, while simultaneously providing employers with an easily accessible and searchable database of I-9 forms.
E-Verify
In 1996, Congress established three “employment eligibility verification” pilot programs to complement and improve upon the I-9 process. See 110 Stat. 3009–655, note following 8 U.S.C. § 1324a, Ariz. Contractors Assn., Inc. v. Candelaria , 534 F. Supp. 2d 1036, 1042 (Ariz. 2008). Originally known as the Basic Pilot Program, E-Verify is the only one of these three pilot programs still in operation today.
E-Verify is an Internet-based system that allows a registered employer to confirm an employee’s work authorization. As part of the process, the employer enters information from the I-9 form for comparison to government records, including those of the Social Security Administration (SSA) and DHS. In response, the employer receives either a confirmation or tentative non-confirmation of work authorization. The employee then has the option of contesting the tentative non-confirmation. If the employee does not contest it, or the challenge is unsuccessful, the employer must either terminate the employment relationship or notify the federal government that it continues to employ the individual notwithstanding the E-Verify result. If an employer receives an E-Verify confirmation on a particular employee, it enjoys a rebuttable presumption that it did not knowingly employ an undocumented worker in violation of federal law.
Although participation in E-Verify was originally voluntary, a series of federal and state laws have recently emerged requiring use of the program. For example, pursuant to a June 2008 executive order and implementing regulations effective September 2009, federal contractors must now use E-Verify to confirm the work authorization of employees working on certain government contracts as well as employees hired during the terms of those contracts. See48 C.F.R. §§ 22.1800-03, 52.212-5, 52.222-54. In addition, several states have enacted laws requiring the use of E-Verify by private employers, public employers, and/or employers with state and local contracts. These states include Arizona, Colorado, Florida, Indiana, Minnesota, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, Rhode Island, South Carolina, Utah, and Virginia.
Signed into law in 2007 by then-Governor Janet Napolitano, the Legal Arizona Workers Act (LAWA), penalizes Arizona employers that knowingly or intentionally hire undocumented workers, by suspending or revoking their business licenses. See Ariz. Rev. Stat. § 23-212, -212.01. LAWA also requires that all Arizona employers use E-Verify. See id. § 23-214. Notwithstanding this requirement, LAWA does not directly penalize employers that fail to use E-Verify. Rather, employers simply forgo the rebuttable presumption defense afforded to those who use the system. Last May, in Chamber of Commerce v. Whiting, 131 S. Ct. 1968 (2011), the U.S. Supreme Court upheld LAWA as constitutional. In doing so, the Court rejected arguments that federal law preempts state statutes that require E-Verify. The Court hinged this particular part of its ruling on the fact that LAWA does not include a penalty for failure to use the program. To do otherwise, the Court intimated, would render the statute preempted by federal law. The Whiting decision is critical because it gives all states a green light to join those that already mandate E-Verify.
SSNVS
E-Verify is not the only online program for employers to compare an employee’s information against government databases. Another program is SSNVS. Rolled out nationwide in June 2005, SSNVS is a voluntary online program that allows employers to enter the names and Social Security numbers of their employees to confirm whether the names and respective numbers match SSA records. As with E-Verify, employers may not use SSNVS on applicants or for other pre-hire screening purposes. According to the SSNVS Handbook, the “SSA will verify SSNs and names solely to ensure that the records of current or former employees are correct for the purpose of completing Internal Revenue Service (IRS) Form W-2 (Wage and Tax Statement).” The handbook also provides that the SSA’s response “does not make any statement about [the] employee’s immigration status.”
To some degree, these cautionary statements conflict with recent actions by the DHS in connection with “no-match” letters long-issued by the SSA to employers when a particular employee’s name and corresponding Social Security number do not match the agency’s records. Specifically, in August 2007, the DHS issued proposed regulations stating that an employer’s receipt of a no-match letter may be evidence that an employer “knew or should have known” the employee was not authorized to work in the United States, thereby subjecting itself to liability under federal law prohibiting the knowing employment of undocumented workers. See 72 Fed. Reg. 45611 (Aug. 15, 2007). The regulations also provided a “safe harbor” provision allowing employers to avoid liability by taking certain steps in response to no-match letters, including checking for clerical errors, notifying the employee of the discrepancy, and directing the employee to resolve the discrepancy with the SSA within 90 days. If the employee failed to do so, the safe-harbor provision required the completion of a new I-9 not based on the Social Security number or a Social Security card.
When the Americans Civil Liberties Union challenged the proposed regulations in federal court, the DHS revised and ultimately rescinded the regulations. See generally ALF-CIO v. Chertoff, 552 F. Supp. 2d 999 (N.D. Cal. 2007); 73 Fed. Reg. 15,944 (Mar. 26, 2008); 74 Fed. Reg. 51447 (Oct. 7, 2009). Notwithstanding these actions, whether and to what extent the DHS may still consider no-match letters in its investigations remains unclear. For those employers not using E-Verify, SSNVS provides a tool to locate and resolve discrepancies between names and Social Security numbers before receiving a no-match letter. Notably, the procedures set forth in the SSNVS Handbook parallel those of the now-defunct safe-harbor provision with the exception of not requiring a second I-9.
Electronic employment eligibility verification programs have recently attracted attention from both the White House and Congress.
The same month the Supreme Court ruled in Whiting, the White House published its blueprint for immigration reform, entitled, “Building a 21st Century Immigration System.” According to the White House, “[e]mployers must be equipped with reliable tools, such as mandatory electronic employment verification that builds off of the existing E-Verify system with improved fraud detection to ensure that their employees are eligible to work in the United States.” “Such a system will transform hiring practices for the 7.7 million employers across the country,” the White House explained.
Four months later, Congressman Lamar Smith (R- TX) and 15 other members of the House of Representatives introduced a bill to replace the I-9 with an electronic employment eligibility verification system patterned after E-Verify. See H.R. 2885, 112th Cong. (2011). Similar to the current I-9 requirements, this new verification system would still require that new hires attest to whether they are a citizen, noncitizen national, lawful permanent resident, or alien authorized to work in the United States. It would also require that employers examine specified documents to confirm the identity and employment authorization of new hires, much as they do in completing the I-9. The bill is currently making its way through the committee process. If signed into law, the legislation, known as the “Legal Workforce Act,” would preempt any state or local law relating to “the hiring, continued employment, or status verification for employment eligibility purposes, of unauthorized aliens.” The legislation would not, however, prevent states or local governments from exercising authority over business licensing “and similar laws” as a penalty for failure to use the new federal verification system.
These developments undoubtedly foreshadow the creation and implementation of a universal electronic employment eligibility verification program to supplant the I-9 process and E-Verify and SSNVS systems. Before establishing such program, however, Congress must resolve a number of issues, including whether certain employers are exempt from the requirement, particularly smaller employers with limited technological resources. Another issue is whether the law will require that employers verify both current and future employees using the new program, or just employees hired after a certain date. Any legislation will also need to ensure that the new program is secure and accurate, and quite possibly accompanied by a procedure by which employees may “contest” the result, similar to what is currently available with E-Verify. Finally, lawmakers must ensure that the system has the capacity to return results for all employers in a reasonable period.
Although the answers to these various questions are unlikely to come before the November 2012 election, and in all likelihood will not be resolved for a number of years, there is no question about the direction and future of employment eligibility verification in the United States. Employers already availing themselves of electronic verifications systems, either voluntarily or pursuant to a federal or state requirement, will find themselves well ahead of the curve when that moment inevitably arrives.
Keywords: litigation, employment and labor relations law, immigration, E-Verify, SSNVS
Michael J. Lehet, is an associate in the Chicago, Illinois, office of Littler Mendelson, P.C.