In an effort to cope with the void left by the federal government's failure to curb illegal immigration, Tennessee has joined the ranks of 15 other states that have enacted "get tough" immigration-related legislation aimed at stricter enforcement of immigration laws within their state borders by requiring public and private employers to enroll and participate in the E-Verify program to verify the employment eligibility of newly hired employees.1
Signed into law by Governor Haslam on June 7, 2011, the Tennessee Lawful Employment Act ("the Act") requires all employers in Tennessee to demonstrate that they are hiring and maintaining a legal workforce either by:
- Enrolling and verifying the employment eligibility of all newly hired employees through the E-Verify program,2 or†
- Requesting all newly hired employees to provide one of the following identity and employment authorization documents3:
- A valid Tennessee driver's license or photo identification
- A valid driver's license or photo identification from another state where the license requirements are at least as strict as those in Tennessee
- A birth certificate issued by a U.S. state, jurisdiction or territory
- A U.S. government issued certified birth certificate
- A valid, unexpired U.S. passport
- A U.S. certificate of birth abroad
- A certificate of citizenship
- A certificate of naturalization
- A U.S. citizen identification card
- A lawful permanent resident card
- Other proof of employee's immigration status and authorization to work in the United States
Under the Act, the employment verification provisions referenced above will be phased in as follows:
- All state and local government agencies must enroll and participate in E-Verify or request and maintain an identity/employment authorization document from a newly hired employee no later than January 1, 2012†
- All private employers with 500 or more employees must enroll and participate in E-Verify or request and maintain an identity / employment authorization document from a newly hired employee no later than January 1, 2012†
- All private employers with 200 to 499 employees must enroll and participate in E-Verify or request and maintain an identity / employment authorization document from a newly hired employee no later than July 1, 2012†
- All private employers with 6 to 199 employees must register and utilize E-Verify or request and maintain an identity / employment authorization document from a newly hired employee no later than July 1, 2013
The requirement that employers enroll and participate in E-Verify or request and maintain an identity / employment authorization document does not appear to make a distinction between in-state and out-of-state employers, and it is unclear whether the Act requires an employer with operations in multiple states to utilize E-Verify to confirm the employment eligibility of all of the employer's workers or only the employees in Tennessee. Arguably, if the E-Verify provisions of the Act were limited to newly hired employees in Tennessee only, the Act could potentially provide an unfair competitive advantage to employers located outside of Tennessee by incentivizing those employers to relocate their business(es) to a state that does not require enrollment and participation in E-Verify.††† †
It is also unclear from the language of the Act whether employees working outside of Tennessee are counted as part of the total number of employees for purposes of determining the law's effective date for private employers. For example, if a Tennessee employer has 600 employees, but only 150 employees work in Tennessee, would the employer be phased in and subject to the Act on January 1, 2012 or July 1, 2013?
For employers without Internet access, the Act allows such employers to enter into a Memorandum of Understanding with the Tennessee Department of Labor and Workforce Development and permits this agency to enroll the employer in the E-Verify program and conduct employment verification checks of newly hired employees through E-Verify on behalf of the employer. An employer who has requested this service from the Tennessee Department of Labor and Workforce Development, but has not received assistance will not be in violation of the Act. Alternatively, the Act allows employers to utilize the services of a third party agent to conduct the E-verification process for newly hired employees. †
Under the Act, employers must maintain a record of results generated by E-Verify for three years from the date of hire or one year from the date of termination, whichever is later. Employers who elect to verify the employment eligibility of newly hired employees by requesting an identity and employment authorization document, rather than enroll in E-Verify, must retain this documentation for three years after the documentation is received or for one year after the employee (or non-employee, whichever is the case) stops providing services or labor, whichever is earlier.
Any lawful resident of Tennessee or any employee of a federal agency may file a complaint alleging a violation of the employment verification provisions of the Act. If there is satisfactory evidence of a violation, the Commissioner of the Tennessee Department of Labor and Workforce Development will conduct an investigation and issue an initial order, which will include:
- The Commissioner's findings and determination†
- The penalties if a final order is issued†
- The process involved in requesting a contested hearing†
- The process by which the Commissioner will waive penalties for first-time offenders
An employer who is a first-time offender will be issued a warning if the employer complies with all remedial action requested by the Tennessee Department of Labor and Workforce Development and did not knowingly violate the employment verification provisions of the Act.
An employer who has been found to have violated the employment verification provisions of the Act will be assessed $500 for the first violation, $1,000 for a second violation and $2,500 for a third or subsequent violation. In addition to these civil penalties, first-time offenders will also be assessed an additional $500 for each employee or non-employee who was not verified through the E-Verify program or for whom an identity / employment authorization document was not requested. For second and third violations, employers will be fined an additional $1,000 or $2,500, respectively, for each employee or non-employee. †
An employer who fails to submit evidence of compliance with the employment verification provisions of the Act, within 60 days of a final order, will have its business license suspended until the employer remedies the violation. The Tennessee Department of Labor and Workforce Development will also post a publicly available list on its website of any employer against whom a final order has been issued.†† †
Lastly, the Act authorizes the Commissioner of the Tennessee Department of Labor and Workforce Development to promulgate rules and regulations to put into effect and enforce the employment verification provisions of the Act.
As the immigration landscape becomes increasingly enforcement-driven, employers must align their worksite compliance strategy with the various state immigration laws currently in effect in the state(s) in which they operate.† Between the U.S. Department of Homeland Security's increased enforcement initiatives and the one-two punch of new state and local immigration laws, employers in Tennessee will face the daunting task of trying to comply with a growing patchwork of policies and federal, state and local laws aimed at curbing illegal immigration.
1. According to the National Conference of State Legislatures, in the first quarter of 2011, state legislators in the 50 states and Puerto Rico introduced 1,538 bills and resolutions relating to immigration. This number surpassed the first quarter of 2010, when 1,180 bills were introduced.
2. E-Verify is an Internet-based system operated by the U.S. Department of Homeland Security that allows employers to verify the employment eligibility of their employees, regardless of citizenship. Based on the information provided by the employee on his or her Form I-9, E-Verify checks this information electronically against records contained in DHS and Social Security Administration (SSA) databases. E-Verify is currently voluntary for all employers with very limited exceptions.
3. For non-employees, such as independent contractors, the Act also requires employers to request an identity and/or employment authorization document.
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