Sharing of Form I-9 or E-Verify Data May Be Unlawful

Employers and third-party vendors should identify needs and explore alternatives.

On May 30, the U.S. Department of Justice's Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) issued a technical assistance letter (TAL) stating that employers that share Form I-9 or E-Verify data with third parties, such as payroll service providers or pay card suppliers, may be in violation of both the Immigration and Nationality Act and the employer's E-Verify Memorandum of Understanding with the Department of Homeland Security and the Social Security Administration.[1] The TAL, which is an administrative opinion and which has not been validated by any court decisions, could have a significant impact on employers whose third-party payroll service providers or other benefits providers currently require the employer to provide the vendor with Form I-9 and E-Verify information in order, for example, to verify the identity of the employee who is being issued a paycheck or a pay card by the vendor.

What does this mean for my company?

Employers that currently share Form I-9 or E-Verify information with third-party vendors should take steps to identify the legitimate needs of the third-party vendors with respect to employee information. These employers should also seek to identify alternative methods of satisfying those legitimate needs through material other than the Form I-9, Form I-9 information, E-Verify records, or other protected personally identifiable information. This issue may arise in connection with payroll administration, pay card vendors, benefits providers, or other third parties.

Third-party vendors that typically request Form I-9 or E-Verify information in order to verify the identities of individuals in connection with services provided to employers should take steps to determine how essential the information is to their business, whether it arises from a legal obligation, and what alternative mechanisms may exist to meet their legitimate needs.

How can we help?

Depending upon the type of service being provided by a third party to an employer, the nature of the information being shared, and the third party's need for the protected information, the search for a practical solution may require input from a variety of disciplines, including employment law, employee benefits, banking and financial regulation, and privacy law. If you are an employer, we can bring together the appropriate resources to help you identify alternatives to providing protected information to third parties. If you are a third-party service provider, we can work with you to find ways to meet your legitimate needs for information while at the same time ensuring that you are not improperly collecting or requesting restricted data. 

[1]. View the TAL here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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