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I 9 master 7-09 I 9 master 7-09 Presentation Transcript

  • Wolfsdorf Immigration Law Group Are You Ready For An I-9 Audit? It’s Time to Get Your I-9’s in Order! Presentation by Bernard P. Wolfsdorf and Tien-Li Loke Walsh Attorneys at Law © 2009 Wolfsdorf Immigration Law Group (all rights reserved) A program focused on training Human Resource Specialists to ensure compliance with immigration regulations when hiring workers.
  • ICE Sends Strong Message to Employers
    • "Immigration and Customs Enforcement (ICE) agency is about to try a new approach: not just targeting the workers, but also the people who employ them, in the first place. "That's a challenge. There are millions of employers in the United States."
    • "We're very cognizant that we just can't focus on the very top, on the biggest employers – that we have to do this at all levels."
    • "ICE is committed to establishing a meaningful I-9 inspection program to promote compliance with the law...This nationwide effort is a first step in ICE's long-term strategy to address and deter illegal employment."
    • John Morton, Department of Homeland Security Assistant Secretary for ICE
    • July 1, 2009: ICE issues 652 Audit Notices in one day!
        • More than ICE issued in all of 2008
  • Enforcement Now Has Teeth!
    • Interagency cooperation the norm – local, state, federal agencies, SSA, state wage and labor investigators, postal service investigators, Department of Labor, enforcement agencies
    • Criminal prosecutions of company owners, managers, HR personnel with knowledge
    • Use of undercover informants
    • Heavy fines and asset seizures
    • Use of forensic experts
  • Worksite Enforcement Statistics
    • FY 2004 - 850 worksite arrests
    • FY 2007 – 4,940 worksite arrests, including 863 arrests based on criminal charges
    • FY 2008 – 5,713 worksite arrests, including 1,101 arrests based on criminal charges
        • 700% increase in worksite enforcement cases compared to FY 2002
        • 135 were business owners, supervisors, managers, and HR personnel
  • Worksite Enforcement Statistics
    • FY 2008 – ICE obtained criminal fines, restitutions, and civil judgments in excess of $30 million
    • FY 2009 budget: $3 billion for enforcement activities; $100 million for E-Verify
    • What to do if ICE or DOL or IRS agents come knocking at your door
        • Everybody from reception to senior management must be aware of proper steps and chain of communication
  • The I-9 Gets a Make-Over
    • New Form I-9 – effective April 3, 2009
      • Only acceptable version has edition date (Rev. 02/02/09)N on bottom right corner of all pages
      • This version of the I-9 will not expire until further notice
  • The I-9 Gets a Make-Over
      • What has changed?
        • all documents presented during the Form I-9 process must be unexpired. Includes
          • U.S. passport
          • All List B documents
        • New U.S. passport card added to List A on August 8, 2008
  • Other Noteworthy Changes to I-9 (December 2007)
      • Eliminated documents from List A, including:
        • Certificate of Naturalization (Form N-550 or N-570)
        • Unexpired Reentry Permit (Form I-327)
      • M-274 Handbook for Employers
          • SS number not required for Section 1 unless enrolled in E-Verify
  • Who Completes I-9?
    • Citizens, nationals and non-citizens. U.S. citizens include persons born in Puerto Rico, Guam, the U.S. Virgin Islands and the Northern Mariana Islands.
      • Nationals of the United States include persons born in American Samoa, including Swains Island.
    • Exempt groups
        • “ grandfathered” employees hired before November 7, 1986
        • Casual domestic workers
  • Independent Contractors
    • Exempt from I-9 requirement
    • Cannot use independent contractors (IC) to circumvent immigration laws
      • Cannot hide behind existence of written contract with contractor/subcontractor
      • Liability if employer has constructive knowledge (CK)
        • ICE takes broad view of CK where employer is under obligation to make further inquiries of the contractor
  • Common Issues in I-9 Compliance
    • I-9 should only be completed for people an employer actually hires
      • No prescreening
  • Three Sections of I-9:Timing Issues Section 1: Employee Information and Verification – Complete on first day
    • Section 2: Employer Review and Verification
    • Complete Section 2 within 3 business days
    • Section 3: Updating and Reverification
    1 2 3
  • Section 1 Common Mistakes Employee Information and Verification
      • Employee did not:
            • Sign or date the form
            • Complete Section 1 on date of hire
            • Check one of the four boxes regarding status or checked the wrong box
  • Section 1 Common Mistakes (continued)
    • Employee did not:
      • List an A #: ________________This is the number on the Alien Registration Card or EAD Card
      • Complete expiration date - Employee authorized to work until ____/____/_____ expiration date of work permission, plus the A number on either the EAD Card or the I-94 Card.
    • Make sure the employee signs and dates the Form I-9. If not signed, employer assumes liability for false statements in Section 1.
  • Section 2 Common Mistakes Employer Review and Verification Employer did not: - sign or date Section 2 - fill in date of hire - did not complete Section 2 within 3 business days of hire
  • Section 2: Common Mistakes One from List A - or - One from List B + One from List C
  • Section 2 Common Mistakes (continued) Employer: - did not complete information about document title, issuing authority, document number and expiration date - photocopied the documents but did not complete the form
  • Section 2 Common Mistakes (continued)
    • Employer accepted:
    • - unacceptable documents (hospital birth certificate,
    • foreign birth certificate, restricted SS card, expired
    • document)
    • - documents that have been removed from current list
    • (Naturalization Certificate)
  • Section 2 Common Mistakes
      • Employer:
      • - accepted documents that did not “reasonably relate to the
      • employee (different names, different date of birth)
      • - reviewed too many documents –discrimination
  • Section 2 Common Mistakes
      • Employer:
      • - keeps copies of documents for some employees, but not all
      • - employer representative who signed the form was not the
      • same person who saw the original documents
  • Section 3 Common Mistakes
    • Employer did not re-verify when required
    • Employer did not complete the information required in Section 3
    • Employer did not sign Section 3
  • How to Complete an I-9 for… Alien with Nonimmigrant Visa
    • e.g. E-1, E-2, E-3, H-1B, L-1, O-1, O-2, P-1, P-1S, P-2, P-3, R-1
    • Complete Section 2, List A block
    I-94 card USCIS/DHS 123456789 DATE Passport # (Country) DATE
  • Examples of I-94 card
  • How to Complete an I-9 for… Individuals with EAD
    • Complete Section 2, List A block
    EAD DHS/USCIS WAC123456789 DATE
  • Sample EAD
  • How to Complete an I-9 for… F-1 Students with CPT
    • Complete Section 2, List A block with:
      • Form I-20 (all pages) with CPT notation
      • I-94 card
      • Unexpired foreign passport
  • F-1 Students with CPT AND AND CPT Annotation SEVIS number
  • How to Complete an I-9 for… J-1 Intern/Trainee
    • Complete Section 2, List A block with:
      • DS-2019
      • I-94 card
      • Unexpired foreign passport
      • Letter from responsible officer (if academic training)
  • How to Complete an I-9 for… J-1 Intern/Trainee AND AND Letter from DSO approving employment (if academic training)
  • Common Issues in I-9 Compliance
    • Document Abuse
      • Can’t request documents before hire or during interview
      • Can’t specify which documents to accept – provide List and let employee choose which documents to present
      • Can’t require more documents than required on the List
      • Can’t refuse to honor acceptable documents
      • Can’t ask to see document listed from Section 1 attestation
  • Common Issues in I-9 Compliance (continued)
    • Original versus photocopies of documents
      • Must personally examine the document
      • Photocopies not acceptable
        • Exception: certified copy of birth certificate
  • Common Issues in I-9 Compliance (continued)
    • How does an employer know if a document is real?
      • reasonable test – acceptable if it reasonably appears on its face to be genuine and relates to the individual presenting it
      • Signs of fraud – e.g. if SS number has more than 9 digits or SS number that begins with 000, 800 or 900 (unused)
  • Should Employer Copy Supporting Documents?
    • Past practice – if you copy – reveals mistakes in process
      • Current practice: keep copies
        • Critical to efficient review and correction of I-9s during internal audit
        • Useful defense in government audit or investigation against a claim that documents never presented
        • Evidence to show good faith – copy shows that document on its face, reasonably appeared genuine
  • To Copy or Not to Copy?
    • E-Verify Employers must photocopy if document used as part of the Photo Screening Tool (permanent resident (I-551) and Employment Authorization Document (I-766)
    • If not E-Verify employer, no requirement to copy
    • Don’t copy more documents than required
  • Common Issues in I-9 Compliance (continued)
    • What if employee is unable to provide the required documents within 3 business days?
      • Can accept receipt in some circumstances
    • What is “Receipt rule?”
      • 3 situations qualify
  • Receipt Rule
    • Receipt for a replacement document when the document has been lost, stolen, or damaged
      • valid for 90 days
        • must present the replacement document to complete the Form I-9 within 90 days
      • Receipts for new document replacing expired document not allowed
        • Receipts for renewals of EADs are not acceptable for verification and reverification purposes
  • Receipt Rule Receipt (Passport) Dept. of State 123456789 N/A
    • When you receive actual document, line out “receipt,” put expiration date, date and initial
  • Receipt Rule
    • Form I-94; temporary I-551 stamp and a photograph of the individual - considered a receipt for the Form I-551, Permanent Resident Card.
      • If I-551 stamp has no expiration date - must present I-551 within one year from the date of issuance
    • Form I-94 containing an unexpired refugee admission stamp
      • must present acceptable documentation to complete the Form I-9 within 90 days of hire date or expiration date of employment authorization
  • Common Issues in I-9 Compliance (continued)
    • Other situations where receipt is acceptable
      • AC-21 H-1B portability
      • H-1B Cap-gap for F-1 students on OPT
      • F-1 STEM graduates with extended 17-month OPT
      • Nonimmigrant visa extensions – e.g. E-1, E-2, H-1B, L-1, O-1, P-1, etc.
        • Timely filing of extension with USCIS automatically grants 240 days of continued employment authorization
  • AC-21 H-1B Portability
    • Complete Section 2, List A block with:
      • USCIS Receipt Notice or Courier Notice
      • I-94 card showing H-1B status with original employer
      • Unexpired foreign passport
  • AC-21 H-1B Portability
    • Attach the following documents to I-9:
      • Copy of USCIS receipt. If you use courier receipt as evidence of filing, replace it with a copy of the USCIS filing receipt once received;
      • Copy of the alien employee’s I-94 card (demonstrating lawful admission into the United States and H-1B status).
      • Unexpired foreign passport
    • Once approved, update the I-9 (by inserting the expiration date, initial and date it) or complete a new I-9 with the new H-1B expiration date from the I-797 Approval Notice
  • H-1B Cap-Gap for F-1 Students
    • Complete Section 2, List A block with:
      • Expired EAD (I-766)
      • New Form I-20 (all pages) (showing extended employment authorization dates)
      • USCIS Receipt Notice (I-797) showing receipt of H-1B petition or USCIS Approval Notice
    • Once H-1B approved, update or complete new I-9
  • F-1 STEM students with additional 17 month OPT
    • Complete Section 2, List A block with:
      • Expired EAD card (I-766)
      • New Form I-20 (all pages) (updated to show school recommended STEM authorization, beginning on date after the expiration of EAD)
      • USCIS receipt showing timely filing of I-765 extension
      • Receipt valid for 180 days
    • Once approved – update I-9 with EAD
  • NIV Extensions
    • 8 C.F.R. §274a.12(b)(20) automatically extends employment authorization for 240 days if timely filed extension
    • Complete Section 3 of I-9 with USCIS Receipt Notice
  • NIV Extensions
    • Doc. Title: Form I-797 Receipt
    • Document #: USCIS Receipt Number
    • Expiration date: calculate the date that is 240 days (8 months) beyond the current expiration date and notate 8 C.F.R. §274a.12(b)(20)
    • Once approved, update Section 3 with the new expiration date (line out, initial and date) or complete a new I-9.
  • Common Issues in I-9 Compliance (continued)
    • Can employer terminate an employee for failure to produce documents within 3 business days?
  • Reverification
    • Must reverify on or before employment authorization expires
    • Employee must choose from List of Acceptable documents
    • Employer has option to complete new I-9 instead of completing Section 3
    • If used I-9 dated before 02/02/09, must use new I-9 to reverify
        • Write employee’s name in Section 1, complete Section 3, attach to old I-9
  • Reverification: Common Mistakes
    • Do not reverify U.S. citizens/green card holders or “continuing employees”
  • Reverification: Common Mistakes
    • Exception: Temporary I-551 stamps must be reverified
    ** * *
  • Reverification: Unresolved Issues
      • Conditional Permanent
      • Residents or CPRs with
      • 2-year green cards
  • Organization of I-9s
    • Never keep I-9s with personnel files
    • Organize in 3 categories
      • I-9s for current employees
      • I-9s for employees with expiration dates that require reverification
      • I-9s for terminated employees that may require purging/destruction at the appropriate time
  • Organization of I-9s
    • Electronic Retention
    • Guidelines in M-274 on pages 15-17
    • What to avoid and what to look for in I-9 software
  • Retention Rules
    • Must retain until the later of
      • three years after the date of hire, OR
      • one year after the date of termination 
    • Example #1 Example #2
    • Hired: 3/1/2000 Hired: 3/1/2000
    • Left: 5/1/2001 Left:8/5/2003
    • 3 yrs after hire = 3/1/2003 3/1/2003
    • 1 yr after term = 5/1/2002 8/5/2004
    • Retain until: 3/1/2003 Retain until: 8/5/2004
  • Common Issues in I-9 Compliance (continued)
    • Mergers, Acquisitions and Restructuring
      • No requirement to complete I-9s, but assume liability if defective
      • Importance of internal self-audits
        • I-9s
        • Immigration files
        • Contractors/Subcontractors
  • Common Issues in I-9 Compliance (continued)
    • Correcting mistakes and omissions on I-9s
      • Never too late to complete I-9s
      • How to correct mistakes and omissions
      • Never delete, white-out, black-out
      • Never backdate
  • What is wrong with this I-9?
  • Common Issues in I-9 Compliance (continued)
    • Is a Social Security number required to hire an individual?
      • NO!!!
      • How to generate paycheck without a social security number
  • Strategies for Compliance (Minimizing Liability)
    • Have a written corporate immigration compliance policy
    • Corporate compliance policy must include clear statement:
      • non-discrimination practices
      • prohibiting the hire of undocumented workers – zero tolerance policy
      • appropriate use of independent contractors
  • Compliance Policy (continued)
    • Best Practices for I-9 Compliance
      • Centralize authority – assign to responsible party
      • Tickler system to ensure
        • timely reverification of expirations
        • timely purging/destruction
      • Centralize storage
      • Conduct regular internal audits
      • Conduct regular training for anyone involved in I-9 compliance
  • Compliance Policy (continued)
    • Discovery of I-9 fraud or identity theft
    • Mergers, acquisitions and restructuring
    • Social Security mismatch letters
  • Constructive Knowledge
    • Definition:
      • The term “knowing” includes not only actual knowledge but also knowledge which may fairly be inferred through notice of certain facts and circumstances which would lead a person, through the exercise of reasonable care, to know about a certain condition
      • Depends on totality of circumstances
  • Constructive Knowledge?
    • Failure to take reasonable steps to address the following situations:
      • An employee’s request for the employer’s sponsorship for a labor certification (green card) or visa petition (nonimmigrant visa)
      • Receipt of a no-match letter from the Social Security Administration
      • Recent cases have broadened interpretation of CK
        • CK arising from “reckless and wanton disregard” – interpreted to include employers who recklessly entrust incompetent employees with hiring or I-9 compliance responsibility. e.g. failure to reverify an I-9
  • “Good-Faith” Defense
    • Also known as the Sonny Bono amendment
    • Good-faith compliance is a defense with respect to a “knowingly hiring an unauthorized alien” charge
    • Only applies to failures occurring on or after September 30, 1996
  • Civil Penalties
    • Knowingly hiring or continuing to employ unauthorized aliens
        • First offense: not less than $375 and not more than $3,200 for each unauthorized alien
        • Second offense: not less than $3,200 and not more than $6,500 for each unauthorized alien; or
        • Subsequent offenses: not less than $4,300 and not more than $16,000 for each unauthorized alien
  • Civil Penalties
    • Failing to comply with Form I-9 requirements
      • Paperwork violations
        • e.g. failure to complete, retain and/or make available for inspection
    • Penalty: Not less than $110 and not more than $1,100 for each violation
      • DHS considers the following in assessing the amount of penalty:
        • Size of business
        • Good faith of employer
        • Seriousness of violation
        • Whether or not the individual was an unauthorized alien; and
        • History of previous violations of the employer
  • Increased Penalties
    • Apply to any violations occurring on or after March 28, 2008
    • Increased by approximately 25% ($100 to $1,000)
    • Penalties assessed on a per-alien basis
  • Criminal Penalties
    • Engaging in a pattern or practice of knowingly hiring or continuing to employ unauthorized aliens
      • Fines of up to $3,000 per employee and/or 6 months imprisonment
    • Engaging in fraud or false statements or otherwise misusing visas, immigration permits and identity documents
      • Fines and/or imprisonment for up to 5 years
  • Related Offenses
      • Unlawful discrimination (OSC)
        • e.g. document abuse
          • asking for more documents than required by I-9
          • asking for particular documents such as a “green card”
          • rejecting documents that appear to be reasonably genuine
          • Treating employees who “look or sound foreign” differently
      • Document Fraud
      • Conspiracy to transport and harbor unlawful aliens
      • Money laundering
  • Government Programs
    • Social Security Number Verification System (SSNVS)
      • Call-in number 1-800-772-6270
      • Online system verifies up to 10 names/SSNs for immediate results
        • http://www.ssa.gov/employer/ssnv.htm
      • Overnight system – uploads a file with up to 250,000 names/SSNs for next business day results
  • Government Programs
    • IMAGE (ICE Mutual Agreement Between Government and Employers)
    • Employers must:
      • submit to I-9 audit by ICE
      • Use the SSNVS to verify the SSNs of existing workforce
      • Commit to “Best Hiring Practices”
      • ICE provides training, education to IMAGE partners on proper hiring procedures, fraudulent document detection, and antidiscrimination laws
  • E-Verify Program
    • Program Summary
      • Automated link to federal databases – DHS/SSA
      • Employers register online at www.uscis.gov
      • Memorandum of Understanding (MOU) is signed by employer, DHS and SSA
      • Staff members using E-Verify must complete tutorial online
  • E-Verify Program
      • Electronic query submitted once I-9 is completed
        • No prescreening
        • Only for new hires and existing employees classified as “employees assigned to the contract.”
        • Some exceptions: institutes of higher learning, state and local governments, governments of federally recognized Indian tribes, sureties performing under a takeover agreement with a federal agency
          • Can choose to only use E-Verify on
            • new employees assigned to the contract
            • existing employees assigned to the contract
      • Automated response regarding employment eligibility
      • Follow-up required for “tentative non-confirmations”
  • E-Verify Program
    • Mandatory for all employers in Arizona, Mississippi and South Carolina
    • Other states with some sort of E-Verify requirement (mostly state/public agencies):
      • Colorado, Georgia, Minnesota, Missouri, North Carolina, Oklahoma, Rhode Island, Tennessee, Utah
    • September 8, 2009: all federal contractors and subcontractors must use E-Verify
  • Participation in E-Verify: Pros and Cons Is it Right for You?
    • Participation serves as a valid argument for good faith compliance for Management and HR in the event of an audit, raid or enforcement action by government
    • E-Verify is the future
      • almost all immigration related legislation pending before Congress includes some form of E-Verify participation requirement
  • Participation in E-Verify: Pros and Cons Is it Right for You?
    • Increases exposure to government audits – DHS is data-mining
      • Participation does not guarantee against government enforcement actions
    • MOU gives ICE broad access to company records, including employment records, right to interview employees, periodic on-site visits
    • Controversy over accuracy of databases
    • Concern over lack of available resources and funding of the program
    • Increased risk of wrongful termination
    • Administrative burden – non-confirmation resolution is time-consuming and disruptive
    • Decentralized hiring or remote hiring sites present challenges
    • State variances confusing – some states require mandatory participation; some prohibited from participating
    • Open Forum:
    • Question and Answer Session