United States: U.S. Employers Take Note: Required Use Of New Form I-9 Scheduled For April 3, 2009

Beginning April 3, 2009, all U.S. employers are required to begin using the new Form I-9 to verify employee identity and work authorization, or face increased risk of prosecution and penalties.

As of April 3, 2009, the U.S. Department of Homeland Security – U.S. Citizenship & Immigration Services (USCIS) requires that all U.S. employers use the new Form I-9 (the Employment Eligibility Verification Form) to verify the identity and work authorization of each individual hired to perform work in the United States.

This rule was originally scheduled to become effective on February 2, 2009. USCIS has announced that implementation of the rule will be delayed until April 3, 2009, to allow for additional public comment. A future On the Subject will advise on any changes to the rule made after the comment period.

A Brief History of the I-9 Requirement

Prior to 1986, employers were not held accountable for employing illegal workers. If caught, the fault lay with the employee, who could face deportation, rather than with the employer. There was neither a requirement that an employer check an employee's immigration status nor a threat of fines or sanctions for employing undocumented workers. In 1986, Congress changed this stance when it passed the Immigration Reform and Control Act of 1986 (the Act) as part of the existing Immigration and Nationality Act. The Act has since been amended to add further protections aimed at preserving "the tradition of legal immigration while seeking to close the door to illegal entry."

The Act's employer-sanction provisions, which were an integral part of the original legislation, seek to eliminate the job market for illegal workers by prohibiting employers from hiring anyone who cannot present proof of authorization to work in the United States. Under these provisions, employers cannot knowingly hire unauthorized workers or continue to employ such workers after learning they are not authorized. In addition, all employers must verify the identity and employment eligibility of every employee hired after November 6, 1986, using the Form I-9. Employers who ignore these rules or apply them improperly are subject to potential civil and criminal penalties.

What Is Different About the New Form?

The new Form I-9 requires that all documents presented by the employee must be unexpired. It is important to note, however, that to the extent employers accepted expired documents prior to April 3, 2009, and those documents were acceptable under the rules then in effect, there is no need for employers to re-verify. Such documents were appropriate at the time and the Form I-9s completed then will continue to be treated as valid. Going forward, however, an employer may not, under any circumstances, accept expired documents when completing the Form I-9.

In addition, the list of acceptable documents has changed. The list has expanded to include three new types of acceptable documentation: the U.S. Passport Card, passports from the Federated States of Micronesia and the Republic of the Marshall Islands, and unexpired foreign passport with a machine-readable visa. Two types of work authorization cards have been deleted from the list because they are no longer acceptable: Temporary Residence Cards (Form I-688), and Forms I-688A and B, two outdated versions of the Employment Authorization Document (EAD). These outdated versions of the card have been replaced by the Form I-766, which is now the only acceptable version.

The final change is that Section 1 of the new Form I-9 now has separate boxes for U.S. citizens and U.S. nationals. A copy of the new Form I-9 can be found on the website of U.S. Citizenship and Immigration Services (formerly known as Immigration and Naturalization Service or INS) at http://www.uscis.gov/files/form/I-9_IFR_02-02-09.pdf.

When Must Employers Use the New Form?

Employers must use the new Form I-9 for all new hires (even if hired for only one day) and complete Section 1 of the Form I-9 on the day the employee begins work. Section 2 and the remainder of the Form must be completed within three business days from the commencement of employment. Employers should also keep in mind that they must complete the Form I-9 in the presence of the worker. The employer must sign the Form I-9, attesting under penalty of perjury as having seen the documents.

Special Rules of Note

If an employer is open weekends or holidays, then those days must be counted when determining the three-day deadline. Employers may permissibly ask the employee to bring in work authorization documents on the first day of employment, but the employee may permissably take up to three days to provide the appropriate documentation. If an employee is being hired for three days or less, employers must complete the Form I-9 procedure before commencement of employment and the employee does not have three days to complete the process. There are special rules that apply for minors and disabled persons, as well as when an employee offers a receipt rather than the actual required document. Employers should seek the advice of counsel to the extent that they have questions about appropriate documentation.

For rehires, the employer need not complete a new Form I-9 if the person is rehired within three years of initial completion of the Form I-9. However, employers should review the initially completed form in this circumstance. If the initially completed form does not indicate the expiration date of the document provided, then employers need not do anything. If the form references an expiration date that has since passed, however, then employers should re-verify the employee using the new Form I-9. For rehires who have been separated from the company for three or more years, then the employee is treated as a new hire and the new Form I-9 must be used.

For How Long Must Employers Keep the Completed Forms?

The rules require that employers maintain a correctly completed Form I-9 for each current employee. In addition, employers must maintain completed Form I-9's for at least three years from date of hire or one year after employment has ended, whichever is later.

What Are the Penalties for Noncompliance?

Penalties for Hiring Illegal Workers

The Department of Homeland Security agency charged with investigating employers who hire undocumented workers is the U.S. Immigration and Customs Enforcement (ICE). The potential fines against employers who knowingly hire or continue to hire illegal workers range from a civil fine of $275 to $3,200 per worker for the first offense, $2,200 to $6,500 per worker for the second offense, and $3,300 to $16,000 per worker for every additional offense. To the extent an employer has engaged in a "pattern or practice" of wrongful conduct, the employer can face jail time.

In fact, at the end of January 2009 a federal judge sentenced the owner of a New Bedford, Massachusetts, factory to 12 months in prison and imposed almost $2 million in fines and assessments against the company after it pled guilty to 22 counts against it, including knowingly harboring and concealing illegal workers and mail fraud. The factory's manager received two years' probation for her role in hiring and concealing the illegal workers.

ICE is increasingly imposing criminal penalties on employers who flaunt the law, filing felony charges of harboring undocumented workers, money laundering and knowingly hiring undocumented workers. Some of these felonies are punishable by a potential 10-year prison sentence and, as in the case of the New Bedford business owner, there have been convictions of corporate officers, business owners, managers, contractors and facilitators.

Under its broad enforcement authority, ICE is also increasingly seizing ill-gotten gains. Since businesses can be viewed separately or together, violations by one division or related entity can affect the entire controlled group of businesses.

Penalties for Failing to Comply with the I-9 Rules

In addition to monetary and criminal sanctions for the conduct identified above, ICE is pursuing what some might otherwise feel are harmless paperwork violations. But harmless they are not; penalties for failure to verify employment eligibility, failure to complete Form I-9 properly for each employee, failure to present a Form I-9 within the required period after request for review, or failure to maintain a Form I-9 for every employee for the length of time required by the rules can include fines of $100 to $1,400 per worker. ICE can also impose fines on agents of employers who did the actual hiring or conducted the actual verification of employees' work status.

In addition, the Act's document-fraud provisions prohibit assisting someone with supplying false documents. In other words, an employer, supervisor or manager can be charged under the fraud provisions for assisting someone in providing false documents or in preparing a false Form I-9. As a general rule, however, the agency does not seek sanctions against low-level employees and ICE will take into account "good faith" efforts to comply when considering mitigation of penalties or sanctions. However, for all the reasons identified above, employers should be mindful of the Form I-9 rules and be sure to follow them in order to avoid the potential for serious civil or criminal penalties.

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.

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