Employers Must Be Prepared for I-9 and E-Verify Inspections - Immigration and Customs Enforcement (ICE) Inspection of Forms I-9 and the Monitoring and Compliance Branch of the US Citizenship and Immigration Services Checking on E-Verify Users

by Poyner Spruill LLP
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Has ICE Been Busy in 2013? What to Expect if You Get a Notice of Inspection

On November 6, 1986, the Immigration Reform and Control Act required employers to verify the identity and employment eligibility of their employees hired after November 6, 1986 and created criminal and civil sanctions for employment related violations. 8 C.F.R. § 274a.2 designates the Employment Eligibility Verification Form I-9 as the means to do so. 
Ensuring employer compliance is the responsibility of ICE and is initiated by a Notice of Inspection (NOI).  Over 3000 NOIs were issued in 2013. Based upon that inspection, more than 50% of the Notices of Intent to Fine were sent to small businesses.  Misconceptions about I-9 compliance among  small business owners run the gamut from the employer believing it is “safe” if it only hires US citizens to the use of E-Verify somehow insulates it from ICE enforcement  for I-9 deficiencies.
Once the NOI arrives, the employer is permitted at least 3 business days to produce its I-9s for inspection.  In addition to the I-9s, ICE can and does request supporting documentation, such as payroll records, a list of current employees, the company’s articles of Incorporation, and any business licenses.
ICE will notify the audited employer in writing of the results of the inspection. The following are the most common notices:
  • Notice of Inspection Results known as a "compliance letter" -- notifies the employer that it was found to be in compliance
  • Notice of Suspect Documents – advises the employer that based upon its review of the I-9s and the documentation submitted by the employee, ICE has determined that an employee is unauthorized to work and advises the employer of the possible criminal and civil penalties for continuing to employ that individual.  ICE provides the employer and employee an opportunity to present additional documentation to demonstrate work authorization if they believe the finding is in error.
  • Notice of Discrepancies – advises the employer that based on its review of the I-9s and the documentation submitted by the employee, ICE has been unable to determine employment  eligibility. The employer must provide the employee with a copy of the notice and an opportunity to present additional documentation to establish employment eligibility.
  • Notice of Technical or Procedural Failures – identifies technical violations identified during the inspection and gives the employer ten business days to correct the I-9. After ten business days, uncorrected technical and procedural failures will become substantive violations.
  • Warning Notice – where substantive violations were identified but circumstances do not warrant a monetary penalty, and there is the expectation of future compliance by the employer, ICE advises the employer that it is basically giving it another chance
  • Notice of Intent to Fine (NIF) – issued for substantive, uncorrected, technical errors in the I-9s, or knowing unauthorized hires or continuation of employment of unauthorized workers.  This must be accompanied by charging documents specifying the violations committed. The employer has the opportunity to either negotiate a settlement with ICE or request a hearing before the Office of the Chief Administrative Hearing Officer (OCAHO) within 30 days of receipt of the NIF. If the employer takes no action after receiving a NIF, ICE will issue a final order. If a hearing is requested, OCAHO assigns the case to an Administrative Law Judge (ALJ), and sends all parties a copy of the Notice of Hearing and the government's complaint.  Many OCAHO cases never reach the evidentiary hearing stage because the parties either reach a settlement, subject to the approval of the ALJ, or the ALJ reaches a decision on the merits through dispositive prehearing rulings.
Penalties for substantive, uncorrected, yet technical I-9 violations range from $110 to $1,100 per employee. The average fine for a small business without legal representation runs approximately $935 per employee. The civil penalties for hiring undocumented workers range from $375 to $3,200 for the first violation, $3,200 to $6,500 for the second violation, and $4,300 to $16,000 for the third and subsequent violation.  Knowing violations can result in criminal sanctions which include imprisonment of not just owners, but managers as well.  Sanctions also include debarment from federal contracts and other government benefits.
While annual I-9 self-audits are a good idea, they must be conducted correctly.   Fines can result if the I-9s are redone and the originals are discarded, changes to the I-9 are made without initialing and dating the forms, or back-dated information is added.
At a minimum, an employer should have the following policies in place:
  • Identify who is in charge of I-9 compliance
  • Ensure that person or his or her designee knows how to complete the forma and avoid common mistakes
  • Have a consistent policy for retaining or not retaining supporting documents
  • Know if the company is also required to use E-Verify and is enrolled if required
  • Know how I-9s should be stored and when they can be purged 
Many businesses are turning to electronic I-9s that are integrated with E-Verify.  These programs are helpful but problems with an electronic I-9 provider will not insulate an employer from liability.  Know your I-9 provider and, in the event of an NOI, be sure it can produce the I-9s and documentation promptly and in readable format.

Only Trying to Help: Desk Reviews or Site Visits by US Citizenship and Immigration Services’ Verification Division Monitoring and Compliance Branch

The US Citizenship and Immigration Service’s Verification Division Monitoring and Compliance Branch (M&C Branch) observes E-Verify system use to help employers comply with the Memorandum of Understanding, E-Verify Manuals, related Form I-9 instructions, and applicable laws.  In North Carolina, use of E-Verify for new hires became mandatory for employers with 25 or more employees on July 1, 2013.  The M&C Branch identifies and seeks to deter possible discriminatory practices and employer misuse.  While the M&C Branch does not fine employers, it may refer cases of suspected misuse, abuse, and/or fraud to appropriate agencies. 
Specifically, the M&C Branch’s function is to check the following:
  • Creation of a case by the employer by the third day after the employee started work for pay
  • Confirm review by the employer of acceptable documents
  • Ensure that one such document contains a photo
  • Ensure the employer printed the Further Action Notice when appropriate and discussed privately with the employee
  • Confirm that the employer closes cases properly
The desk review or site visit is a pro-active effort by the M&C Branch to provide guidance one-on-one to an employer on the correct use of E-Verify.  A desk review is conducted by phone and email and a site visit is an in-person visit to the employer’s place of business.
Triggers that may bring an employer to the attention of the M&C Branch resulting in a desk review or site visit include creating duplicate cases for the same employee, verifying employees hired before November 7, 1986, creating cases for employees hired before the employer enrolled in E-Verify (with the exception of certain federal contractors), and immediately terminating an employee based upon a tentative nonconfirmation.

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