United States: What To Expect When You're Not Expecting: How To Handle Unplanned Visits From Federal Agencies

Last Updated: February 4 2016
Article by Wendy C. Hyland

The unannounced arrival of an investigator from a federal agency is an unwelcome business interruption which can be a drain on productive time and arouse collective anxiety in your business environment. Effective management of the investigation from the very beginning is critical to achieving the best possible outcome, no matter which agency comes calling.

This article outlines best practices for handling, from start to finish, unplanned investigations involving two of the federal government agencies most active in employer audits: the U.S. Department of Labor (USDOL) and the Department of Homeland Security (DHS).

Labor Pains: The Department Of Labor

The USDOL might show up on your doorstep for an investigation to assess your compliance with the Fair Labor Standards Act, the federal wage and hour law. Investigations generally arise from a current or former employee's complaint, but they may also stem from an internal USDOL initiative targeting businesses in specific industries.

Planned Visits

Sometimes the USDOL investigator will initiate an audit by transmitting a scheduling letter announcing a date and time of arrival to review documents. The letter will typically request a list of current and former employees for the past two years, along with various payroll records to determine whether these employees were properly compensated. This will include an examination of overtime pay, exempt status, and paycheck deductions.

You are also often asked for documents to demonstrate compliance with rules on record retention, minors in the workplace, independent contractor classification, and perhaps even the Family Medical Leave Act.

Surprise Inspections

On other occasions, however, an investigator from USDOL may arrive without any advance notice, requesting documents and employee interviews. As a general rule, you should not agree to an immediate inspection and should instead request additional time to plan strategy. It is normally possible to delay the investigation for a week or so simply by explaining that business considerations warrant time to gather information.

We suggest that you try to agree with the investigator on a date certain to return and a time estimate for the visit. If the investigator does not have a written document outlining the scope of the information requested, ask for a list of the information the investigator would like to review at the appointed time, which can be sent by email.

Handling Employee Interviews

If the investigator asks to interview employees, you should prepare in advance by selecting strong employees from a cross-section of departments. Prepare a list and schedule of employees for the investigator to interview, budgeting approximately 20 minutes per employee.

You should set aside a private space for the interviews to minimize business disruptions. This allows the investigator access to sufficient information, but simultaneously allows you to somewhat control the situation and reduce business interruptions.

Day Of Investigation

Before the investigator arrives, check for required postings to be certain that they are current and in a visible location. You should prepare a clean, document-free, private space for the investigator to review documents and interview employees. Perhaps most importantly, you should designate an individual to work with the investigator to make sure the investigation process is organized and efficient.

When the investigator arrives, have the requested documents organized and ready for review, making sure that you keep a copy of every document you provide. Have your point person accompany the investigator should they request a tour of your facility, as the investigator may want to look at your required postings, the location of your time clocks, and other relevant aspects of your premises.

Pay particular attention to whether the investigator attempts to broaden the geographical scope of the investigation to facilities beyond the one which is currently the subject of review. Typically, the USDOL investigator seeking to pursue an expanded inquiry will explore the interconnectedness among your business entities by asking whether facilities share employees, managerial leadership, and ownership interests. Plan for your designated representative to be the only authorized individual to answer these inquiries on behalf of the company.

Icy Cold Reception: Immigration And Customs Enforcement

An investigator from Immigration and Customs Enforcement (ICE), the DHS investigative arm, may be another unexpected visitor. This investigator will be reviewing your compliance with the requirements of the Immigration Reform & Control Act of 1986. An ICE investigator will typically arrive with a Notice of Inspection seeking to review I-9 employment eligibility forms for current employees. The time to reply is short – usually just three business days. However, the investigator may be agreeable to a short extension for legitimate business reasons.

What Will The Investigator Look For?

A typical compliance review consists of an investigator verifying that your I-9 forms have been properly completed. This typically includes a review of your documents to ensure that they are timely completed within three days of the date of hire, they are correctly and entirely filled out, and that the associated documents establishing identity and employment eligibility are legitimate.

What To Expect After An ICE Investigation

The I-9 form review process may take as little as two weeks or as long as a year. Once the review is complete, ICE will inform you of the results. The best news you can hope for would be a letter indicating that you are in compliance. If only minor violations were found, ICE may issue you a notice of technical or procedural failure indicating certain mistakes on forms, and you will have 10 business days to correct them.

If more substantive violations were found, ICE may issue you a warning notice without assessing a monetary penalty. However, if the agency determines that you have knowingly hired individuals not authorized to work in the United States, it may issue you a notice of intent to fine (typically $500 to $700 per I-9 form). If this occurs, you should consult with counsel to request a hearing before a federal administrative law judge within 30 days, and your lawyer may be able to negotiate a reduction of the fine.

ICE may also issue you a notice of suspect documents regarding an employee's authorization to work, advising you of potential penalties if you continue to employ that individual. In such a case, you will be given an opportunity to provide additional documentation to show authorization to work. Similarly, the agency may issue a notice of discrepancy indicating that work eligibility cannot be determined for a certain employee, with an opportunity for that worker to provide documentation showing employment eligibility or face termination from employment.

What Can You Do Today To Prepare For Tomorrow?

There are two main steps you can take today to minimize the chances of an unwanted knock on your door tomorrow: educate your key workers, and conduct internal audits.

Educate Your Employees On Compliance Issues

Many potential compliance problems can be avoided with clear procedures and training given to those workers expected to follow them. No matter which substantive area a federal government investigator may seek to review, you will be in a better position if you have prepared response protocol and educated your employees in advance on your policies.

That way, even if an investigator arrives without notice, you have designated steps in place and employees will not panic. This will avoid the problem of having unauthorized or uninformed workers providing contemporaneous and uncoordinated responses to inquiries, and should prevent an investigator from pulling unsuspecting employees away from work for interviews.

As noted above, one of the most important steps you can take is designating an employee with sound judgment and in a leadership role to lead your response from the first instance of an unplanned arrival. Make sure that employees know to call that point person to manage face-to-face interactions, prepare any records, and provide verbal or written representations made on behalf of the company. That designee should be trained to ask for credentials from the investigator, request a business card for follow-up, and seek additional time to prepare requested information.

With respect to immigration-related documents, you should ensure proper training for your personnel responsible for the completion of I-9 forms. You might also consider an electronic I-9 system to automate the process and minimize opportunities for technical human error. On a related note, even if state or federal law does not require it for your company, consider using the federal internet-based E-Verify system to confirm employment eligibility.

Schedule And Perform Periodic Internal Audits

Finally, you should consider the enormous benefit of setting aside time to review compliance issues periodically, well before a federal investigator arrives to begin looking at your records. You should keep copies of documents verifying identity and employment eligibility when completing I-9 forms so that technical corrections may be made without having to go back to your workers.

It is a valuable use of time to periodically review your time clock records, not only to track tardiness for attendance purposes, but also to check against pay records to ensure the accuracy of non-exempt employees' compensation for all hours worked at the appropriate rate. You may consider engaging counsel to review a sampling of documents for common problems or even for suggestions on changes to process.

Time spent on these proactive measures is time saved in opportunity costs and lost productivity should the government one day come calling.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Wendy C. Hyland
In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions