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Responding to the Increasingly Aggressive Pursuit of Employers and Undocumented Workers

June 20, 2011
KEYWORDS business / management
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Richard D. Alaniz

In early April, after a three-year hiatus, the Social Security Administration (SSA) resumed sending No-Match Letters, advising employers that an employee’s reported name or Social Security number (SSN) does not “match” a name or SSN combination in the SSA database. This re-introduction of the No-Match Letters, in conjunction with U.S. Immigration and Customs Enforcement’s (ICE’s) skyrocketing issuance of Notice of Inspections of I-9s, evidences the federal government’s increasingly aggressive stance in using all available information to curb the hiring of unauthorized workers and to penalize employers who do.

DEPARTMENT OF HOMELAND SECURITY AND NOTICES OF INSPECTION

On Feb. 14, 2011, the Department of Homeland Security (DHS) issued more than 1,000 new Notices of Inspection across the country and expects to issue new NOIs every quarter. Given the probability of more employers receiving an NOI, it is imperative that every employer be aware of the consequences of these NOIs and understands how to adequately prepare for them.

The NOI process is as follows:

1. The employer will be served with a NOI requesting the I-9 forms. Often, the NOI will request supporting documentation and may have a subpoena attached requesting additional information. Although the focus of the NOIs is to locate employers who hire undocumented workers, DHS is also targeting those employers who improperly complete their I-9 forms by fining them for “paperwork violations.”

2. The employer will have three business days to present the documentation to ICE.

3. After the I-9s have been reviewed internally by the employer, the records will be sent to ICE for its review, also known as an inspection.

4. ICE will notify the employer, in writing, of the results of the inspection once completed. The following are the most common notices:

• Notice of Inspection Results: Also known as a “compliance letter,” used to notify a business that they were found to be in compliance.

• Notice of Suspect Documents: Advises the employer that ICE has determined that a specific employee is unauthorized to work and advises the employer of possible penalties.

• Notice of Discrepancies: Advises the employer that based on the inspection, ICE has been unable to determine an employee’s work eligibility.

• Notice of Technical or Procedural Failures: Identifies technical violations identified during the audit and gives the employer 10 business days to correct the forms.

• Warning Notice: Issued in circumstances where substantive violations were identified but circumstances do not warrant a monetary penalty and there is an expectation of future compliance by the employer.

• Notice of Intent to Fine (NIF): May be issued for substantive, uncorrected technical, and procedural violations.

If a NIF is served, charging documents will be provided specifying the violations committed by the employer. The employer, through counsel, can negotiate a settlement with ICE or request a hearing before the Office of Chief Administrative Hearing Officer (OCAHO) within 30 days of receipt.

RESPONDING TO NOIs

In the event you receive an NOI, do not consent to an immediate review of I-9 records, despite any efforts by ICE to have you do so. Even if they physically appear at your door with the NOI in hand, you still have three business days to reply. Also, do not answer any immediate questions about your hiring practices, immigration policies or business operations. Remain calm, a NOI is not a raid!

As NOI inspections are serious and dangerous matters, we do recommend retaining counsel immediately. Inform the ICE agent that the company’s attorney will be in contact to discuss production of records. Under any circumstances, do not consent to any ICE interviews with management or hourly employees without the presence of immigration counsel. Regardless, ICE would need a warrant to question hourly employees on the employer’s premises.

Given DHS’ focus on NOIs, employers should conduct regular in-house I-9 audits well before receiving a NOI. Such audits allow employers to assess its current verification system and determine if changes in policies and procedures are required.

THE SOCIAL SECURITY ADMINISTRATION'S NO-MATCH RULE

In 2007, the Department of Homeland Security issued the controversial Final No-Match Rule requiring employers to engage in a series of steps upon receiving a No-Match Letter in exchange for a “safe harbor” from certain immigration liability. Due to litigation, however, that regulation never went into effect and the No-Match Rule was eventually rescinded in 2009. Continuing its aggressive pursuit of undocumented workers and those who employ them, the SSA resumed its practice of sending out No-Match Letters on April 6, 2011.

There are various reasons an employer may receive a No-Match Letter, which may have nothing to do with an individual’s immigration status or work authorization. Legitimate explanations may include: the employee’s name may have changed due to naturalization, marriage, or divorce; the employer or SSA may have made a clerical error in the name spelling or numeration of the SSN; the employee may have made a clerical error in their name or SSN; identity theft; or errors made in proper culturally based hyphenated or multiple surnames.

THE NEW NO-MATCH LETTER

The new No-Match Letter omits cautions included in the prior proposed version, namely letting employers know that failure to act can lead to further prosecution. More importantly, the new No-Match Letter no longer includes language informing employers that their failure to act creates a presumption of constructive knowledge of the presence of illegal workers. Previously, simply by receiving the letter employers were deemed to know that they were employing unauthorized workers. The new letters do not create this presumption of constructive knowledge. However, receipt of a No-Match Letter can still be used by DHS in combination with other evidence in any future prosecution or Notice of Inspection of the employer’s I-9 records. In addition, the new format is to receive one No-Match Letter per employee. The old format was to include all the employees on one single, comprehensive No-Match Letter.

RESPONDING TO NO-MATCH LETTERS

Since the prior Safe Harbor Rule was rescinded, neither the Social Security Administration nor the Department of Homeland Security has issued any new guidance on how to appropriately respond to No-Match Letters. This has left employers at a disadvantage; they must walk a fine line between doing too little and having any inaction used against them later or doing too much and risking a discrimination or wrongful termination claim. Until new guidance is released, you should follow the model set forth in the prior (withdrawn) Final Rule:

1. Do not fire, suspend, intimidate, threaten, or take adverse action against any employee simply because their name appears on the No-Match Letter.

2. Within five business days of receipt of the No-Match Letter, begin reviewing your records to confirm whether a reporting or input error is the cause of the no-match. Crosscheck payroll data against I-9 data, including the name and Social Security number. If there is an error, correct it according to the No-Match Letter’s instructions.

3. Within 30 days of receipt of the No-Match Letter, if there is no reporting or input error, bring in the referenced employee to confirm that the information on record is correct. If there is a mistake, fix the error and document in writing what the error was and the action taken.

4. If there is no error, provide a written notice to the employee of his obligation to address the error with the local Social Security Administration office within 90 days of receipt of the No-Match Letter. Note that the employee can return documentation that the error has been corrected. Importantly, you cannot require the employee to produce any specific evidence from the SSA that the No-Match has been resolved.

5. If the employee returns with some form of documentation, you must consider it to determine if it is sufficient to deal with the discrepancy. You may utilize the Social Security Number Verification System (SSNVS) to verify that the no-match no longer exists. Update the I-9 if needed (name change, etc.). Keep any received documentation with the No-Match Letter along with any copies of confirmed SSNVS results and notices given to the employee. Keep No-Match Letters and related documentation separately from I-9s.

6. If after the 90 days of receipt of the No-Match Letter, the employee has not been able to resolve the error, complete a new I-9 for the employee. For this specific purpose, you cannot accept documents subject to the No-Match Letter (e.g., Social Security Card) and any identification documents must contain a photograph. Otherwise, you should use normal I-9 verification procedures by allowing the employee to choose his/her own List A or List B and C documents. If the employee cannot bring you documents by the end of the third day from completion of the I-9 (Day 93), then you may terminate the employee.

As the current environment of aggressive government enforcement against employers is not likely to subside anytime soon, employers should take care to comply with all regulations and carefully complete and maintain all necessary paperwork. Conduct regular in-house I-9 audits and carefully track all I-9s and related information. Do not panic when regulators come calling, but take their inquiries seriously. Careful response to these investigations can help to avoid large fines and disruption of your operations.

Publication date: 06/20/2011

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