We have written many articles over the years on what happens when ICE serves an employer with a Notice of Inspection (NOI); see below for links to our articles and resources.  Today, ICE released a new Fact Sheet that referrences the  IRCA law in the 1st paragraph, and then summarizes the order in which an ICE administrative inspection proceeds, the types of notices that are issued following an I-9 ICE audit, how fines are determined based upon knowingly hiring and continuing to employ violations, to substantive and uncorrected techical violations, and how these fines and penalties are calculated.

The penalties for ignoring the legal requirements of the I-9 process can be quite severe, even in cases of unintentional omissions and uncorrected I-9 mistakes. Civil penalties for such errors may range from $110 to $1,100 for each effected employee. A business with thousands of employees and multiple worksites may face a significant financial burden in noncompliance penalties. The fines may be further increased if ICE determines that an employer knowingly hired unauthorized foreign nationals, and can range from $375 to $16,000 per violation with repeat offenders on the high end. Employers and their representatives convicted of having engaged in a pattern or practice of knowingly hiring unauthorized foreign nationals, may also face criminal charges and fines of up to $3,000 per employee and/or six months’ imprisonment. Other federal criminal statues may provide higher penalties in certain fraud cases.

Employers and individuals who commit citizenship status or national origin discrimination may be ordered to pay civil fines and attorneys’ fees. The penalties range from $375 to $3,200 for the first offense for each individual discriminated against; from $3,200 to $6,500 for the second offense; and for subsequent offenses, not less than $4,300 and not more than $16,000 for each person effected.

The trend toward increased scrutiny of immigration employment practices will likely continue in the foreseeable future. With immigration reform still uncertain, ICE continues to step up enforcement activities with a deluge of NOI’s to employers every few months.  These recent developments have made it even more critical that employers maintain a strong immigration compliance profile.  Employers can no longer afford to think that because they don’t hire foreign nationals, they don’t have any I-9 issues or need to comply with I-9 immigration regulations.

The key to I-9 compliance for most organizations starts with a thorough self-examination of existing paper I-9’s, E-Verify submissions (if applicable), standard operating procedures, and past practices. While there are many checklists and do-it-yourself guides, free webinars and Podcasts available on the Internet and elsewhere, consulting an experienced immigration consultant or attorney in the practice area can save employers hours of research, provide a solution tailored to your organization and save you thousands of dollars in fines and penalties.

You should strongly consider an independent I-9 audit if…

1. You’ve had a turnover in the HR position(s) charged with the responsibility of handling and processing I-9 Forms
2. None of the staff charged with the I-9 process has been formally trained
3. You already know that you have I-9 document violations, errors and unintentional mistakes
4. You have recently gone through a corporate reorganization, merger or acquisition
5. You know you have an on-boarding process that is complex, such as multiple jobsite locations where the I-9 process takes place
6. When you haven’t documented your I-9 Form policies and procedures in a policy statement or procedures manual
7. If you have a large volume of foreign worker I-9 forms
8. If you do not have a calendar system for re-verification or terminated employee retention
9. If you do not have a centralized I-9 recordkeeping process
10. If you are photocopying documents presented during the I-9 process for some and not for others
11. You participate in government contracts and have been asked to perform an I-9 audit
12. You have not performed a random or full audit within the last year by either an internal individual who is familiar with I-9 compliance rules but does not deal with I-9s on a regular basis, or by a reputable independent I-9 auditor.
13. You’ve never performed a self-audit or had any outside provider perform an I-9 audit
14. You do not know how to make corrections to the I-9 form
15. You’ve received SSA No Match Letters
16. Your industry is being targeted by ICE
17. You’re unaware that a new I-9 form was released and do not have a process in place for staying current with regulations and procedures

Immigration Compliance Group regularly represents clients from all industries to develop effective I-9 policies and compliance programs.  By establishing and maintaining effective corporate policies and procedures, many of the above-mentioned warning signs can be addressed proactively in an audit before the government does one for you.

New ICE Fact Sheet

I-9Audit.com – Our Employer Resource Center Articles

We have heard many recent reports that ICE will step up the pressure on its I-9 Field Agents to surpass the number of I-9 audits they performed in 2011, and that they will be looking at various industries such as employers in critical food, energy, and infrastructure industries. In June 2011, ICE did not specify which businesses would be specifically targeted, but did say that immigration agents would focus on seventeen sectors including agriculture, financial services, nuclear reactors, water treatment, and health care.

It has been recently reported by the Farm Employer’s Labor Service (FELS) that the  EVP of NCAE (National Council of Agricultural Employers) was informed by credible sources that ICE field agents will once again focus their I-9 audit investigations on high-profile agriculture and restaurant employers to surpass their 2,496  I-9 audits and 3,291 work site enforcement cases conducted in 2011.  More specifically, they are again (no surprise) targeting high-profile/maximum press coverage employers, the biggest farms and restaurants, and employers who were previously audited and/or had issues with DOL or DHS in the past –  who can now expect to be be revisited in 2012.

With good faith effort being one of the most important rules applied in ICE enforcement audits and investigations, it is recommend that all employers get their ‘houses in order’ as it relates to I-9 employment verification eligibility compliance.  We would strongly suggest that you put your emphasis on  retaining an outside expert to perform a thorough I-9 audit of your active and inactive I-9 forms to really get a handle on problems and reoccurring issues buried in your I-9 forms.  This step alone can save you hundreds of thousands of dollars, as well as the potential of losing employees and recruitment and re-training costs.  Then get your staff trained and don’t let anyone not properly trained be involved with hands-on I-9 functions.  Next, establish a written compliance statement outlining the SOP that your company will follow — a plan that makes sense for your business……then implement it, and be diligent in your efforts to create and maintain  a compliant workforce showing a good faith effort to comply with I-9 regulations to the best of your knowledge and ability.  Lastly, avail yourself of reliable information from skilled professionals that report on compliance issues – subscribe to a newsletter and a blog so that you can stay ahead of the game.  You should check out our free information – both blog and newsletters.

We invite you to contact our firm to discuss your compliance issues, info@immigrationcompliancegroup.com or call 562 612.3996.

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Immigration Compliance Group focuses its practice on corporate employment verification compliance and US and Canadian inbound business immigration.   Our team has a depth of experience in providing uniquely tailored services and solutions to assist clients in developing comprehensive employment authorization and immigration-related compliance.  We conduct onsite and offsite  I-9 audits for companies of all sizes, design training curriculum to assure that staff is knowledgeable concerning the  management of their I-9 program, and we assist with policy development so that our clients have a plan and strategy that assures their compliance in a manner that makes sense for their business and evidences their good faith in establishing a compliant workforce.

It has been recently reported that ICE is launching another round of worksite investigations, but this time, returning to employers that have already been through a federal investigative audit in the last three years.  We’ve not seen this before. Approximately 500 employers are being re-visited by ICE Special Agents to confirm that non-compliant activity identified during prior audits has been resolved.

Employers must make sure they are hiring only people who can work legally in the U.S. Businesses that previously have received warning letters or administrative fines may now be the subject of yet more fines if ICE Special Agents determine that  the employer continues to make the same mistakes.

Bear in mind, that several Federal agencies have the authority to review your I-9 forms, these agencies consist of ICE, The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) and the DOL, Wage and Hour Division.  Each of these agencies investigate violations in the I-9 process, and we strongly advise that employers need to be prepared for a visit from any one of them.

ICE has recently announced their enforcement related statistics in the area of I-9 compliance for 2011, as follows:

• 2,496 I-9 audits were conducted
• 3,291 worksite enforcement cases were initiated
• Criminally arrested 221 employers
• Issued 385 Final Orders for $10.4+ million in fines; and
• Debarred 115 individuals and 97 businesses

These enforcement statistics should indeed be troubling to employers, particularly given that  they don’t reflect the number of ICE notices (such as the Notice of Discrepancies or Notice of Suspect Documents) that are sent to employers, who are otherwise compliant, but may have accepted fraudulent documents or whose employees may have purchased the identity of a US citizen for work authorization purposes, despite your best efforts.  As a result of this, employers across the country have had to terminate thousands of employees and incur the expense of hiring and training new employees.

ICE expects to audit some 3,000 employers in 2012.  We recommend that you hire experts in the field to conduct either a partial or full audit, depending upon your circumstances, train personnel who are charged with the processing of your I-9 forms, and develop a written policy statement that reflects your goals for remaining compliant.

Here is another example of one of the major blunders made by employers in 2011 which is to require specific work authorization documents (permanent resident cards or employment authorization card) of non-US citizen employees rather than permitting them to choose from the list of acceptable documents on the I-9 form.

The Justice Department announced today that it reached a settlement with BAE Systems Ship Repair Inc., a leading provider of ship repair services, to settle allegations that its subsidiary, BAE Systems Southeast Shipyards Alabama LLC, engaged in a pattern or practice of discrimination by imposing unnecessary and additional document requirements on newly hired permanent residents (green-card holders) when establishing their eligibility to work in the USA by requiring them to present Permanent Resident Cards, a/k/a/ “green-cards,” as a condition of employment.

The investigation was initiated after BAE Southeast Alabama suspended a lawful permanent resident even though he had presented valid documents sufficient under the Immigration and Nationality Act (INA) to establish his work authorization on three separate occasions.

BAE agreed to pay a fine of $53,900. The lawful permanent resident who was suspended was previously reinstated and fully compensated by BAE.  BAE agreed to ensure that the employment eligibility verification policies and procedures of all its subsidiaries comply with the law, to train its human resources personnel about employers’ responsibilities to avoid discrimination in the employment eligibility verification process, and to produce Forms I-9 for inspection for three years.  We cannot emphasize enough the importance of employers with subsidiary companies and multiple jobsite locations establishing written, uniform policies and procedures concerning employment eligibility compliance matters.  We also recommend that an I-9 Compliance Manager be appointed to oversee adherence to your compliance standard operating procedures for all subsidiary companies at all locations.

The INA requires employers to treat all authorized workers in the same manner during the employment eligibility verification process, regardless of their national origin or citizenship status.  Employees may choose which document(s) they want to present from the list of acceptable documents.  Employers must accept any document from List A or combination of documents (one from List B and one from List C) as long as it the documents reasonably appear on their face to be genuine and to relate to the person presenting them.  To act in any other manner can be an unfair immigration related employment practice in violation of the anti-discrimination provision of the INA.

We frequently are asked:  If an employee writes down an Alien Number or Admission Number when completing Section 1 of the I-9 form, may I ask to see a document with that number?  The answer to this, based upon the above, is “no”.  It is your responsibility to ensure that your employees fully complete Section 1; however, the employee is not required to present a specific document in order to complete this section.  When the employer completes Section 2, you may not ask to see a document with the employee’s Alien Number or Admission Number or otherwise specify which document(s) an employee may present.

Should you wish to communicate with our office regarding audits, training and policy development, please email us at info@immigrationcompliancegroup.com or call 562 612.3996.  Please sign up for our free news and visit our Blog and employer compliance resource center at:  www.I-9Audits.com

OSC is conducting a free, live webinar series on Worksite Discrimination. If you’re a worker or worker advocate, they have a monthly worker/advocate track webinar. Employers/HR professionals are invited to join their monthly  OSC Employer Training webinar.  The webinars are conducted live from OSC’s headquarters in Washington, DC.   You might want to check this out.

Here is a link to the OSC Powerpoint used in today’s Employer Worksite Discrimination Webinar.  It was a very informative and well done presentation.

Should you wish to discuss how best to implement policies and procedures that will enhance your compliance program, we’d be glad to hear from you:  info@immigrationcompliancegroup.com or 562 612.3996.

Kinro Mfg. a subsidiary of Kinro Inc., which is wholly owned by White Plains, N.Y.-based Drew Industries Inc., has been fined a $25,000 civil penalty and $10,000 in back pay to the injured party for engaging in a pattern/practice of discrimination against work-authorized non-citizens in the employment eligibility verification process.  The company is a manufacturer of components for recreational vehicles and manufactured homes.

Kinro has also agreed to train its human resources personnel about employers’ responsibilities to avoid discrimination in the employment eligibility verification process, to produce Forms I-9 for inspection and to provide periodic reports to the DOJ for one year.

According to the department’s findings, the company subjected newly hired non-U.S. citizens to excessive demands for documents issued by the Department of Homeland Security in order to verify their employment eligibility, but did not require U.S. citizens to show any specific documentation . The charging party, a lawful permanent resident, filed his charge of discrimination after he was required to provide additional proof of his employment eligibility not required by law before he could begin work at the company.

View Press Release

A southern Arizona tomato grower has pled guilty and was sentenced for knowingly hiring and employing illegal immigrants from Mexico, despite the company’s knowledge that these employees were unauthorized to work in the U.S.

Kenneth Ward, HR Director, pled guilty to similar federal charges in 2007 and is awaiting sentencing. In his guilty plea, he alleged that four top company officials, whom he didn’t name, knew of the illegal hiring and that the number of employees illegally hired was more than 1,000.

Eurofresh’s CEO, Johan van den Berg, denied all those allegations in response to questions  on 8/26/11 and said that Ward was fired more than four years ago after the company learned he had been bringing in illegal immigrant employees without higher officials’ knowledge.

The plea agreement said that payment is to compensate for the money Eurofresh earned from the hiring of 17 illegal immigrants from Mexico over the last decade for supervisory jobs. Eurofresh does not agree that the $600,000 is an amount directly related to the violations. Rather, it is a negotiated amount between Eurofresh and the Justice Department. The company will also be required to remain on probation for five years until the judgment is satisfied in full.

Since the illegal hiring was discovered, Eurofresh has implemented tight systems and regular audits to prevent illegal immigrants from obtaining jobs there and is an E-Verify user.

For more on this story.

A story hit the news last week concerning a dispute between two electronic I-9 software providers where outsourcing I-9 software to a third party vendor was involved.  One of the parties wished to cancel its reseller agreement requesting that all I-9 data be returned to its customers.  In so doing, it was revealed that they would have to pay a rather high fee to obtain their customer’s I-9 data in a usable format.  Additionally, it was revealed that the 3^rd party provider had already been directly soliciting the other vendor’s clients to enter into a new I-9 and E-Verify service agreement.  Unable to resolve their differences, a lawsuit was filed on June 27, 2011, seeking an injunction to require the 3^rd party vendor, USVerify, to return its clients’ I-9 data in a reasonably usable and accessible format and to cease and desist from using or disclosing any confidential client information.

In light of the unraveling of this story, it brings clearly to the forefront the importance of being able to access your I-9 and E-Verify data because the employers who are customers of the vendor who is cancelling the reseller agreement, are unable to access their I-9 data at the present time. So, unless they have saved the data in another format or system, it can be assumed that if they were served with an ICE Notice of Inspection (NOI), they would not be able to comply with the NOI’s strict deadlines.

There are several I-9 software vendors in the marketplace, some good, some not.  This includes stand-alone providers that focus solely on I-9/E-Verify, in addition to “all-in-one” providers that offer electronic I-9 software that integrates with the employer’s personnel management software and employment screening/background check applications.

Apparently many all-in-one systems “outsource” the I-9 and E-Verify service to a third party vendor under a “reseller agreement.”  The reseller agreement governs the terms of use and other vital details regarding accessibility of the employer’s I-9 records. Given the rash of recent I-9 audits throughout the country, it is more important than ever for employers to very closely examine these arrangements to ensure that your best interests are protected.

It is not advisable for an employer to rely strictly on a vendor’s representations concerning their products and system compliance as these representations will not protect or insulate you from liability. Employers must undertake independent due diligence to ensure the system they choose complies with the applicable regulations.

If you are using a background screening provider, applicant tracking system, or all-in-one solution, it is imperative that you perform due diligence to ensure they you will have unrestricted access to your I-9 and E-Verify data, especially in the event the reseller agreement is terminated or if the you wish to terminate the agreement with your vendor.

We would recommend asking the following questions:

• Who owns the I-9 E-Verify data under the terms of the agreement?
• Can the employer request a backup of the electronic I-9 and E-Verify data at no or little cost?
• How often can the employer request such a backup and in what format will it be delivered?
• What happens if the vendor closes shop or decides to assign the data to another provider?

Lastly, we remind you that there are specific regulatory electronic I-9 requirements that affect almost every aspect of a vendor’s system and relationship.  These requirements are often confusing and unclear, and you should be encouraged to discuss these issues with experienced immigration counsel to ensure that your I-9 electronic system is compliant with enforcing agencies in all respects.

The American Immigration Attorneys Association (AILA) published an excellent article on the Minimum Requirements for Electronic Verification.  View article

Contact our office should you have any concerns that you’d like to discuss concerning this issue.

February 16, 2011, Brett Dreyer, Chief of the Worksite Enforcement, Unit of Homeland Security Investigations, verified on 2/16/2011 that ICE continues to focus its investigations both on businesses that were brought to their attention by tips and leads, and on those that work in areas of national security and critical infrastructure. Mr. Dreyer further confirmed: “The agency continues to be interested in egregious employers as they tend to break other laws in addition to immigration…including paying employees under the table, avoiding taxes and ignoring employee protections. The inspections will touch on employers of all sizes and in every state in the nation — no one industry is being targeted nor is any one industry immune from scrutiny.”

Confirmation has been publicized that NOI’s were indeed served throughout the USA on February 17^th.  The audits are expected to be completed within the next 2-3 months. We link here for more on this story.

This is a good time to review what you should do if you are served with a Notice of Inspection (NOI):

• Immediately contact Immigration Solutions and company management
• Employers are allowed by law 3 days notice to respond by producing the I-9 records of their active as well as terminated employees within a particular period of time

The NOI will be most probably be accompanied by a very invasive Document Subpoena that might ask for all of some of the below items:  

• A copy of your I-9 Policy and Procedures Statement or Manual
• I-9 forms for current employees hired after 11/6/1986
• I-9 forms for terminated employees within the required retention period
• Complete employee lists of current and terminated employees
• Quarterly Wage and hour reports
• Payroll Summaries
• SSA Mismatch correspondence
• E-Verify and/or SSNVS documents
• Business information such as:  Employer ID number, owner’s SSN/address, business license, etc.

We work with our clients to create compliant workforces, and now is the time to be proactive if you absolutely know that you have problems with your I-9 forms; and, by the way, most employers do.  We encourage you to be proactive and take action now before you pay the high price of being put in a position where your options have diminished.

We are happy to hear from you and are very flexible with our package of compliance services and solutions.  Our talented team is read to assist you with whatever you’d like to accomplish with your compliance programs.  Visit our I-9 Resource Center here.

Here’s another sad story from the restaurant industry. Snack Attack Deli, d/b/a  a Subway Restaurant franchise in Fayetteville North Carolina, has been neglecting filling out I-9 Employment Eligibility forms for several years to the tune of 108 I-9 violations producing a serious fine of some $111,078, as reported by the Department of Justice, Office of the Chief Administrative Hearing Officer (OCAHO) on February 11, 2011.  The Judge considered the small size of the company, the number of employees and their payroll and reduced the penalty down to $27,000 which was still difficult for the small franchise to handle.

Here’s the back story: Snack Attack produced 11 incomplete I-9 forms for 108 employees, current and mostly past employees, following the receipt of an NOI requesting I-9 forms for current and past employees for years 2006 through 2009 from ICE in early 2009.  The ICE auditor provided the owner with a copy of a sample I-9 form along with a copy of the I-9 Employer Handbook and told one of Snack Attack’s employees that if new forms were prepared, they should not be back dated.  Section 2 of the 11 I-9 forms that were produced were not filled out at all, and 7 of the 11 forms had been back dated  – including one for the restaurant owner.  Amazing- go figure!

ICE then issued a Notice of Intent to Fine in July 2009 stating that Snack Attack committed 108 I-9 violations including improper completion of the 11 forms, failing to complete I-9 forms for 97 employees.  Each violation carried a penalty of $1,028.50 for a total of $111,078.

Snack Attack alleged that the back dating was not their fault because it occurred in section 1 and that the owner had sold the business to another person, although there was no evidence to support his claim and so the judge issued civil penalties in the case.

The Judge wrote that failure to prepare an I-9 form is amongst the most serious of paperwork violations, in addition to not filling out the employer attestation in section 2.

It should be stated that there was no evidence of unauthorized workers and the 97 employees for whom no I-9’s were filled out, remains unresolved.  ICE’s position was that Snack Attack’s practices could very easily lead to the hiring of unauthorized workers.

We cannot stress enough that employers must be proactive and generate an I-9 form for all their employees and should catch these serious violations right now, particularly if you are in an industry such as food service, manufacturing/distribution, the garment industry, construction or the hospitality industry that are making headlines every week and creating media nightmares for employers

We also learn with this ruling that although fines are calculated based on regulatory criteria, there is some hope of relief based on a company’s size and business volume.  The question is, could there have had a much happier ending if Snack Attack would have retained the services of a competent attorney with a specialty in employer compliance issues to represent them during the audit?  We say unequivocally, “yes!”

For more information on employer compliance issues, please visit our I-9 Resource Center.