New Law to Mandate Use of E-Verify by Public Works Contractors and Subcontractors

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On July 5, 2012, Pennsylvania Governor Tom Corbett signed into law the Public Works Employment Verification Act (“Act”), which requires state public works contractors and subcontractors to use the E-Verify program operated by the Department of Homeland Security. The E-Verify program is a free online system that compares information from an employee's Form I-9, Employment Eligibility Verification, to government records to instantly confirm employment eligibility.

Under the Act, a contractor must, as a precondition of being awarded a contract for a public work, submit verification that it checked the status of all new employees with the E-Verify program and that, according to the program, such employees are legally permitted to work in the United States. Subcontractors who perform work for public works contractors must provide the same verification prior to starting subcontracting work. Material suppliers are not subject to the Act.

For purposes of the new law, public works projects are those covered under the Pennsylvania Prevailing Wage Act—construction, reconstruction, demolition, alteration and/or repair work, other than maintenance work, done under contract, and paid for in whole or in part by state, municipal, or county funds where the estimated cost of the total project is in excess of $25,000.

Contractors and subcontractors who fail to verify the employment eligibility of their new employees through the E-Verify program will face sanctions, which range from a warning for a first offense to a ban from publicly funded projects for up to three years for willful violations. In addition, contractors and subcontractors who fail to submit the verification will face fines of up to $1,000. The Department of General Services is tasked with creating a verification form, enforcing the Act, investigating complaints, and conducting complaint-based and random audits of contractors and subcontractors.

The Act goes in to effect on January 1, 2013; public works contracts executed after the effective date will be subject to the verification requirements.

For state contractors and subcontractors, as well as other employers, who do not already use the E-Verify program, the Labor and Employment Group at McNees Wallace & Nurick is available to provide additional guidance concerning the process.