Immigration Compliance and E-Verify for Federal contractors


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Immigration Compliance and E-Verify for Federal contractors

  1. 1. “Nuts and Bolts” of E-Verify and Internal Audits: Reduce Your Risks Before the Government Knocks <ul><li>Ronald Adler, President-CEO </li></ul><ul><li>Laurdan Associates, Inc. </li></ul><ul><li>301-299-4117 </li></ul><ul><li>[email_address] </li></ul><ul><li> </li></ul>Eliot Norman, Team Leader Worksite Enforcement and Immigration Compliance Team Williams Mullen 804-783-6482 [email_address] For updates see:
  2. 2. “Nuts and Bolts” of Immigration : Reducing Risks <ul><li>What is at Stake? </li></ul><ul><li>Why Now? “ICE launches initiative to step-up audits”: 652 today, your business tomorrow </li></ul><ul><li>What is the Bottom Line Result? </li></ul>
  3. 3. President Obama on Worksite Enforcement <ul><li>When did it all start? The Press Conference on April 29th </li></ul><ul><li>For First Time: He got asked the Immigration Question. </li></ul><ul><li>His answer in part: </li></ul><ul><ul><li>“We can't continue with a broken immigration system. It's not good for anybody. It's not good for American workers. [We need to be] “taking seriously the violation of companies. That’s again something we can start doing administratively.” </li></ul></ul>
  4. 4. New Assistant Secretary at DHS <ul><li>From the Senate Confirmation Hearings: John Morton, New Director of ICE and former federal prosecutor on April 23rd: </li></ul><ul><li>Q. “What is your view of the worksite enforcement operations conducted by ICE?” </li></ul><ul><li>A. “ WE NEED TO PLACE RENEWED FOCUS ON EMPLOYERS TO ENSURE THAT THEY ARE PLAYING BY THE RULES…THIS FOCUS SHOLD INCLUDE MORE ROUTINE USE OF CIVIL SANCTIONS …AND WE SHOULD CONTINUE TO DEVELOP PROGRAMS SUCH AS E-VERIFY TO ENCOURAGE COMPLIANCE.” </li></ul><ul><li>Mentioned good old days of $25 million annually in civil fines. Time to bring em back. </li></ul>
  5. 5. July 2, 2009: The Napolitano “652” <ul><li>Mass Audit Inspection Notices from ICE </li></ul><ul><li>More enforcement in one day that Bush Administration issued in one year </li></ul><ul><li>Fallout and Follow-through </li></ul><ul><li>Dump Social Security Regulations while keeping “totality of circumstances test” </li></ul><ul><li>E-Verify for Federal Contractors: DHS Secretary Napolitano successfully pushed for September 8th start: Federal litigation over on August 25 th . </li></ul><ul><li>Meanwhile: 15+ States keep their E-Verify enforcement going </li></ul>
  6. 6. Fines Against Employers for Immigration Violations <ul><li>Substantive Violations: Range from $375 to $3200 for First Offense: </li></ul><ul><li>Paperwork Violations: Range from $ 110 to $1100 for each I-9 Form </li></ul><ul><li>Substantive fines: assessed per illegal worker </li></ul><ul><li>Risk Factors; 500 to 1000 hires per year; 5000 to 15,000 I-9 records </li></ul><ul><li>As Federal Contractors: E-Verify: Are you Ready? </li></ul><ul><li>Substantive Violations: can’t fix, government does not have to prove that employer knew it hired or continued to employ illegal alien to assess fines. </li></ul><ul><li>E-Verify Fines for continuing to employ worker whose paperwork does not match DHS and SS Administration records: $ 550 to $1100; $550 for failing to promptly notify an employee of a “temporary nonconformance” </li></ul><ul><li>Comparable Fines, debarment and other remedies against Federal Contractors and Subcontractors </li></ul><ul><li>VALUE OF DESK AUDIT OF SAMPLE OF 25 FORMS: determine scope of problems in advance of government inspections, audits </li></ul>
  7. 7. Criminal Enforcement <ul><li>2007: IFCO Pallet: over 1000 workers, 50% working with “No-Match” Social Security Numbers </li></ul><ul><li>2009 (August) : Yamoto Motors, 28 workers, knowingly let 2 workers go back to work with phony records results in criminal prosecution of 2 managers </li></ul>
  8. 8. Why this Enforcement build-up from April to Now? <ul><li>Fundamental belief: burden should fall upon employers to clean up their act </li></ul><ul><li>13 million “undocumented,” 10 million in the work force </li></ul><ul><li>Necessary political prelude for any Comprehensive Immigration Reform (CIR) </li></ul><ul><li>Napolitano II: White House Meeting August 20, 2009 </li></ul><ul><li>Let’s see who weighed in at that meeting? NAE just joined </li></ul><ul><li>Proposed and Pending Legislation </li></ul>
  9. 9. So What Have We Been Doing To Get Ready for Sea-Change in Enforcement? <ul><li>Putting on “Nuts and Bolts” Webinars Since March, 2009 in response to demand for information </li></ul><ul><li>Putting out the rumors, dispelling the dis-information </li></ul><ul><li>Meeting with clients: looking at records, “an audit a day keeps the government away” </li></ul><ul><li>How do your I-9 records look? </li></ul><ul><li>New I-9 Form effective April 3 rd , Electronic I-9 Forms, Voluntary and Mandatory E-Verify Rolling Out? </li></ul><ul><li>For Past Webinars, click on http:tinyurl/ImmEvents where can you listen to audio, watch the slides </li></ul><ul><li>Self-Audit before… </li></ul>
  10. 10. NEW I-9 FORM Effective April 3, 2009 Section 1 : Employee fills in but Employer Pays Fine if its not Correct or Complete: Data Used For E-Verify Translator/Preparer Certificate Section 2 : HR: Fills in Info From Originals of List A OR List B and C Documents HR Certification: “UNDER PENALTY OF PERJURY” Section 3 : HR Re-Verifies Work Authorization, again under “penalty of perjury” LIABILITY RISKS
  11. 11. Summary: I-9 is one of those Ultimate Government Forms <ul><li>Should be Simple 1 Page Form But </li></ul><ul><li>has 3 Sections with 3 different person completing it. </li></ul><ul><li>one of whom know the least and can cause the most trouble. </li></ul><ul><li>Even your team comes from different, unconnected groups: Recruitment, HR, Payroll, </li></ul><ul><li>Instructions don’t help much </li></ul><ul><li>90 Page Handbook with 63 FAQ </li></ul><ul><li>No Wonder Score Cards = D+ at best </li></ul>
  13. 13. Moving to E-Verify <ul><li>How do you get ready? </li></ul><ul><li>Are you going to have to do it before you are ready? </li></ul><ul><li>The HR Audit process will help you make the transition </li></ul><ul><li>Get ready for additional Federal Agenda, see next slide </li></ul>
  14. 14. American Recovery and Reinvestment Act of 2009 <ul><li>Signed into law by President Obama on February 17, 2009 </li></ul><ul><li>Provides a total of $787 billion in funds </li></ul><ul><li>Unprecedented level of funding designed to help create and save jobs, jumpstart the economy, and build the foundation for long-term economic growth </li></ul>
  15. 15. ARRA: Spending Provisions <ul><li>Funds designated to the following sectors: </li></ul><ul><ul><li>Energy and Environment: $98.234 billion </li></ul></ul><ul><ul><li>Labor, Health and Education: $66.15 billion </li></ul></ul><ul><ul><li>Federal and State Government: $45.742 billion </li></ul></ul><ul><ul><li>Commerce, Justice and Science: $17.842 billion </li></ul></ul><ul><ul><li>Defense and Security: $16.448 billion </li></ul></ul><ul><ul><li>Agriculture and Rural Development: $15.986 billion </li></ul></ul>
  16. 16. Moving from I-9 to E-Verify <ul><li>For the Employer: a motivating factor in terms of compliance and record keeping practices. Shredding the paper; going electronic + Safe Harbor promises </li></ul><ul><li>For the Government: huge incentive: Lets take the data in Section 1 of the I-9 and compare it with the 60 million DHS and 425 million SSA records to electronically verify identify and work authorization of new hires. </li></ul><ul><li>Initially a voluntary or pilot program; </li></ul><ul><li>Initially applied only to new hires at one or more employer sites that registered for E-Verify </li></ul><ul><li>Mixed results pre-2007 or 2008 in terms of accuracy and effectiveness </li></ul><ul><li>HAS GENERATED OPPOSITION: Where is it coming from? </li></ul><ul><ul><li>“ Don’t Ask, Don’t Tell” Businesses: real meaning of “undocumented” aliens </li></ul></ul><ul><ul><li>(e.g. Naturalized citizens not being picked up in the process) </li></ul></ul><ul><ul><ul><li>Estimated 4-6 million U.S. citizens would test as “false positive” =not authorized to </li></ul></ul></ul><ul><ul><ul><li>work </li></ul></ul></ul><ul><li>ALL THAT IS BEHIND US </li></ul>
  17. 17. I-9s to E-Verify <ul><li>How does having external audit done of I-9s help you with the Enforcement Folks? </li></ul><ul><li>Next task: getting ready for E-Verify </li></ul><ul><li>What’s in it for your company? Answer: $$ </li></ul><ul><li>Will be necessary condition to participate in many Stimulus Bill funded projects </li></ul><ul><li>Let’s go back to a familiar photo again </li></ul>
  18. 18. E-Verify Results as of October 2009 <ul><li>Voluntary with 140,000+ employers signed up </li></ul><ul><li>6.8 million queries, maybe 1/10 new hires in 2008 went through E-Verify? </li></ul><ul><li>97% accuracy? Nationally, about 96%+ accurate enough to provide instant verification of identity and work authorization. Maybe 1% are “false” hits and need correction. </li></ul><ul><li>Cannot prevent identity theft or eliminate I-9 process </li></ul><ul><li>Expansion to Federal Government and Federal Contracts September 2009 </li></ul><ul><li>Meanwhile 17 States now have E-Verify Statutes or Executive Orders mandating its use: vary widely. </li></ul><ul><li>I-9s: still there whether you do E-Verify or Not </li></ul><ul><li>What’s an employer to do? </li></ul>
  19. 19. E-Verify States in Red as of August 2009
  21. 21. Immigration Audit: Where do you Start? <ul><li>Getting your arms around the process & documents </li></ul><ul><li>S urvey of HR policies, procedures </li></ul><ul><li>What do you have in writing? </li></ul><ul><li>Where are the files? </li></ul><ul><li>Who on your staff handles these matters? </li></ul><ul><li>Dangers of fragmentation and decentralization </li></ul><ul><li>Do you have any foreign employees? If so, what is their profile, nature of positions and visas </li></ul><ul><li>Future hiring plans or rehires? </li></ul>
  22. 22. E-Verify Audit Checklist “Nuts and Bolts” <ul><li>Checklist has to cover timing and deadlines </li></ul><ul><li>Like going to Federal Court if you are a trial lawyer </li></ul><ul><li>BUT </li></ul>
  23. 23. Evolution of HR Audits <ul><li>To meet the expanding list of threats and risks, HR audits are becoming a comprehensive, sustainable process that: </li></ul><ul><ul><li>Is an integral part of the organization’s internal auditing activities; </li></ul></ul><ul><ul><li>Includes external auditing practices; </li></ul></ul><ul><ul><li>Is a part of risk management and due diligence; </li></ul></ul><ul><ul><li>Is a part of strategic management; and </li></ul></ul><ul><ul><li>Uses sophisticated HR auditing tools, such as ELLA, the Employment-Labor Law Audit. </li></ul></ul>
  24. 24. The HR Audit Process <ul><li>The HR audit process is an independent, objective, systematic evaluation that provides assurances that: </li></ul><ul><ul><li>Compliance and governance requirements are being met; </li></ul></ul><ul><ul><li>Business and talent management objectives are being achieved; and </li></ul></ul><ul><ul><li>HR and EPL related risks are fully identified, assessed, and managed. </li></ul></ul>
  25. 25. ELLA HR Audit Model™ <ul><li>Five Critical Components: </li></ul><ul><li>Activities </li></ul><ul><li>Behaviors </li></ul><ul><li>Risk and Opportunities </li></ul><ul><li>Internal Controls </li></ul><ul><li>Outcomes and Results </li></ul>
  26. 26. Immigration Issues Audit: GRC Approach
  27. 27. Immigration Issues Audit: GRC Approach
  28. 28. Immigration Issues Audit: GRC Approach
  29. 29. Immigration Issues Audit: GRC Approach
  30. 30. “ Nuts and Bolts” E-Verify <ul><li>Register at </li></ul><ul><li>Sign a MOU between your company and DHS/SSA </li></ul><ul><li>Take a Tutorial and score at least 70% </li></ul><ul><li>Must verify all new employees </li></ul><ul><li>After Section 1 and 2 of the I-9 completed, employer representative logs on and submits Section 1 Data which is checked against data bases in DHS and SSA. Must photocopy EADs and Green Cards. </li></ul><ul><li>Same 3 business day rule to submit E-Verification query as for I-9 certifications </li></ul><ul><ul><li>However, can submit E-Verify query before employee starts paid employment and after accepts offer of employment. </li></ul></ul><ul><ul><li>Practical implications when compare to timing of I-9 Form completion </li></ul></ul>
  31. 31. “Nuts and Bolts” <ul><li>Who is going to do the E-Verify? </li></ul><ul><li>How do we handle multiple hiring sites? </li></ul><ul><li>One MOU or multiple MOUs? </li></ul><ul><li>Amend to include additional hiring sites? </li></ul><ul><li>E-Verify Corporate Administrator? </li></ul><ul><li>Differences with I-9 </li></ul><ul><li>Controlled Roll-out </li></ul><ul><li>Centralize Tentative Nonconfirmations (TNC)? </li></ul><ul><li>Complications of Photo Screen Tool </li></ul>
  32. 32. “Nuts and Bolts” <ul><li>RESULTS: </li></ul><ul><li>Instant verification </li></ul><ul><li>Tentative Nonconfirmation (TNC) or </li></ul><ul><li>DHS needs more time (“Case in Continuance” </li></ul><ul><li>SSNs: what if employee doesn’t have one? </li></ul>
  33. 33. THE TNC <ul><li>Tentative Nonconfirmation (TNC) </li></ul><ul><li>SSA TNC </li></ul><ul><li>DHS TNC </li></ul><ul><li>Employer: must notify employee “as soon as possible” of a TNC </li></ul><ul><li>“ Employer will determine whether the employee contests the TNC as soon as possible after the Employer receives it.” </li></ul><ul><li>Best Practice to comply with ASAP rule? </li></ul><ul><li>Employee: 8 federal government work days to contact SSA or DHS </li></ul><ul><li>What to do while employee is contesting? </li></ul><ul><li>Employee has right to continue working </li></ul><ul><li>Employer must check E-Verify system regularly for updates </li></ul><ul><li>Document and clip to I-9 </li></ul>
  34. 37. The Photo Screening Tool <ul><li>Applies only to EADs and Green Cards </li></ul><ul><li>Does not apply if you are using an E-Verify Designated Agent </li></ul><ul><li>Practice Tips: must be exact match, hit Yes, E-Verify will return “employment authorized” response. </li></ul><ul><li>Hit NO, you will get a TNC </li></ul><ul><li>Can’t tell: explain why and mail it in or send in an electronic copy and let DHS decide. </li></ul><ul><li>Problems and Issues </li></ul><ul><li>Don’t need to compare with original Green Card/EAD? </li></ul><ul><li>Potential Liability </li></ul><ul><li>Exact Match Standard </li></ul>
  35. 38. The Final Nonconfirmation (FNC) <ul><li>Must notify DHS if employer continues to employ a worker for whom employer receives an FNC </li></ul><ul><li>Failure to so notify DHS: Fines of $550 to $1100 per worker </li></ul><ul><li>Practical Problem Area for the 1% of false positives or false FNCs, , particularly naturalized U.S. citizens </li></ul><ul><li>DHS recognition of the issue </li></ul><ul><ul><li>New I-9 Rules </li></ul></ul><ul><ul><li>May or may not solve the quandry: do we get fined or do we get sued for termination of lawful U.S. worker? </li></ul></ul>
  36. 39. E-Verify Real-World Experience <ul><li>Viewpoints from: HR; E-Verify Designated Agents, </li></ul><ul><li>employers, employees; outside counsel </li></ul>
  37. 40. MOU <ul><li>Major Benefits and “Safe Harbor” </li></ul><ul><li>Current Areas of Controversy: </li></ul><ul><ul><li>Production of Records </li></ul></ul><ul><ul><li>Sharing of Data </li></ul></ul><ul><ul><li>Proposed Exemption from Privacy Act </li></ul></ul><ul><ul><ul><li>Rulemaking issued May 22, 2009 </li></ul></ul></ul><ul><li>Other Issues as they arise </li></ul>
  38. 41. Use of E-Verify Designated Agent <ul><li>Comments and Demonstration </li></ul>
  39. 42. How Many Different Verification Programs Are out there?? <ul><li>I-9s </li></ul><ul><li>Regular old voluntary E-Verify at Federal Level </li></ul><ul><ul><li>Not mandatory </li></ul></ul><ul><ul><li>you can pick and choose </li></ul></ul><ul><ul><li>applies to new hires only </li></ul></ul><ul><li>State E-Verify: if you employ in a Red State </li></ul><ul><li>Federal (FAR) E-Verify </li></ul>
  41. 44. E-Verify and Federal Contracts <ul><li>How is it supposed to work? </li></ul><ul><li>all new hires and all employees “assigned to the contract” : how defined </li></ul><ul><li>option: can verify all existing employees </li></ul><ul><li>Universities, local governments, Indian Tribes, special rules, apply it only to new employees or existing employees assigned to Federal Contract (FC). Have option of applying it to all new hires, all existing employees. </li></ul><ul><li>Security Clearance Employees exempt </li></ul><ul><li>Bar on re-verifications </li></ul>
  42. 45. E-Verify and Federal Contracts <ul><li>Timetables: Read the MOU , Article II.D.1. 30, 90, 180 day Rules </li></ul><ul><ul><li>Not enrolled in Federal Contract E-Verify. 30 days to enroll, 90 days after enrollment to begin using for new hires. II.D.1.(a). </li></ul></ul><ul><ul><li>Employers enrolled in E-Verify as a Federal contractor for 90 days or more at the time of a contract award must use E-Verify to initiate verification of employment eligibility for new hires </li></ul></ul><ul><ul><li>Employers enrolled in E-Verify as a Federal contractor for less than 90 days at the time of a contract award must use E-Verify to verify new hires after 90 days. Once the Employer begins verifying new hires, such verification of new hires must be initiated within 3 business days after the date of hire. </li></ul></ul><ul><ul><li>For employees assigned to Federal Contract, Employer has either 90 days after contract award or 30 days after employee is assigned to contract, whichever is later, to initiate E-Verify. </li></ul></ul><ul><ul><li>180 day option: after enrolled in FAR E-Verify, can voluntarily enroll all existing employees at all locations in E-Verify. Cannot limit voluntary enrollment to less than all locations in the USA. </li></ul></ul>
  43. 46. Timetable FAR E-Verify part (a) <ul><li>a. Federal contractors not enrolled at the time of contract award: An Employer that is not enrolled in E-Verify as a Federal contractor at the time of a contract award must enroll as a Federal contractor in the E-Verify program within 30 calendar days of contract award and, within 90 days of enrollment, begin to use E-Verify to initiate verification of employment eligibility of new hires of the Employer who are working in the United States, whether or not assigned to the contract. Once the Employer begins verifying new hires, such verification of new hires must be initiated within 3 business days after the date of hire. Once enrolled in E-Verify as a Federal contractor, the Employer must initiate verification of employees assigned to the contract within 90 calendar days after the date of enrollment or within 30 days of an employee’s assignment to the contract, whichever date is later. </li></ul>
  44. 47. Timetable FAR E-Verify part (b) <ul><li>b. Federal contractors already enrolled at the time of a contract award: Employers enrolled in E-Verify as a Federal contractor for 90 days or more at the time of a contract award must use E-Verify to initiate verification of employment eligibility for new hires of the Employer who are working in the United States, whether or not assigned to the contract, within 3 business days after the date of hire. If the Employer is enrolled in E-Verify as a Federal contractor for 90 calendar days or less at the time of contract award, the Employer must, within 90 days of enrollment, begin to use E-Verify to initiate verification of new hires of the contractor who are working in the United States, whether or not assigned to the contract. Such verification of new hires must be initiated within 3 business days after the date of hire. An Employer enrolled as a Federal contractor in E-Verify must initiate verification of each employee assigned to the contract within 90 calendar days after date of contract award or within 30 days after assignment to the contract, whichever is later. </li></ul>
  45. 48. Timetable: FAR E-Verify part (c) <ul><li>c. Institutions of higher education, State, local and tribal governments and sureties : Federal contractors that are institutions of higher education (as defined at 20 U.S.C. 1001(a)), State or local governments, governments of Federally recognized Indian tribes, or sureties performing under a takeover agreement entered into with a Federal agency pursuant to a performance bond may choose to only verify new and existing employees assigned to the Federal contract. Such Federal contractors may, however, elect to verify all new hires, and/or all existing employees hired after November 6, 1986. The provisions of Article II.D, paragraphs 1.a and 1.b of this MOU providing timeframes for initiating employment verification of employees assigned to a contract apply to such institutions of higher education, State, local and tribal governments, and sureties. </li></ul>
  46. 49. Timetable FAR E-Verify part (d) <ul><li>d. Verification of all employees: Upon enrollment, Employers who are Federal contractors may elect to verify employment eligibility of all existing employees working in the United States who were hired after November 6, 1986, instead of verifying only those employees assigned to a covered Federal contract. After enrollment, Employers must elect to do so only in the manner designated by DHS and initiate E-Verify verification of all existing employees within 180 days after the election. </li></ul>
  47. 50. Which Federal Contracts <ul><ul><li>All contracts except </li></ul></ul><ul><ul><li>valued less than $100,000 </li></ul></ul><ul><ul><li>work performed outside the U.S. </li></ul></ul><ul><ul><li>performance less than 120 days </li></ul></ul><ul><ul><li>only for commercially off the shelf COTS items or which would be COTS except for minor modifications </li></ul></ul><ul><ul><li>applies only to entity signing the contract, not necessarily parent or subsidiary not performing direct services under the contract </li></ul></ul><ul><ul><li>Contracting Officer (CO) responsible for inserting E-VerifyFAR clause. http:// /FAREVERIFY (FAR Regulations) </li></ul></ul><ul><ul><li>Your prime contractor company must insert it if covered subcontract is one for services or construction with value of more than $3,000 </li></ul></ul>
  48. 51. E-Verify and Federal Contracts <ul><ul><li>Future Issues? </li></ul></ul><ul><ul><li> </li></ul></ul><ul><ul><li>Court Litigation and Negotiated Results? </li></ul></ul><ul><ul><li>Disclosure of data to contracting officer, USCIS, ICE, DOL </li></ul></ul><ul><ul><li>Alternatives: National Database of New Hires (NDNH) (SHRM proposal) </li></ul></ul>
  49. 52. E-Verify and the Audit Process <ul><li>There are a number of new timetables to track </li></ul><ul><li>There are a number of Do’s and Don’t’s </li></ul><ul><li>Need a comprehensive HR Audit approach, and a dashboard to watch the process unfolding </li></ul><ul><li>Compliance motivator: $550 to $1100 fines </li></ul><ul><li>Lets go back to Internal Audit processes slides </li></ul>
  50. 53. Costs and Benefits of E-Verify <ul><li>Paul Revere approach </li></ul><ul><li>There is more </li></ul>
  51. 54. E-Verify: “Safe Harbor” <ul><li>SAFE HARBOR: Participation in E-Verify does not provide automatic or “blanket” protection from worksite enforcement. However, an employer “who verifies work authorization under E-Verify is presumed to have not knowingly hired an unauthorized alien.” </li></ul><ul><li>Affirmative Obligation on Employers: </li></ul><ul><ul><li>Employer must notify DHS if it continues to employ any worker after receiving a final non-confirmation (FNC) (meaning worker is not who he says he is or does not have work authorization) </li></ul></ul><ul><ul><li>Failure to so notify DHS: Employer is subject to $550 to $1100 civil money penalty </li></ul></ul><ul><ul><li>Employer is subject to rebuttable presumption that it has knowingly employed an unauthorized alien if it continues to employ a worker for whom it has received a final non-confirmation. </li></ul></ul><ul><ul><li>Obligation to notify employee of TNC “as soon as possible”. Best Practice?? </li></ul></ul>
  52. 55. E-Verify: “Nuts and Bolts” Reminders <ul><li>If employee contests TNC, he has 8 government working days to contact either SSA or DHS or both to clear up the problem </li></ul><ul><li>E-Verify now also requires employers to attempt to match scans of photos on Green Cards or Work Cards (EAD) with DHS records; same TNC rules apply; </li></ul><ul><li>However, Photo tool requirements currently do not apply if the employer uses an E-Verify Designated Agent </li></ul><ul><li>Integrity of I-9 systems drives successful use of E-Verify </li></ul><ul><li>Can’t sit back while TNC time-clock is ticking </li></ul><ul><li>Tough cases, get help early </li></ul>
  53. 56. E-Verify: “Best Practices” <ul><li>Sooner shift to E-Verify the better. May have to anyways. </li></ul><ul><li>Should spur elimination of paper I-9 Forms. No sense inviting errors TWICE </li></ul><ul><li>Purchase or develop in-house Software that integrates the I-9 Data into the E-Verify Data. Makes no sense to fill in the I-9 By Hand; and then retype data from one form (I-9) to the other (E-Verify). Security Clearance Difficulties with in-house software and keeping up with changes. </li></ul><ul><li>Cost/Benefit analysis on how to roll-out E-Verify is critical. </li></ul><ul><li>Remember, under the proposed Federal Contractor rules, E-Verify applies to all new hires (whether assigned to the federal contracts or not) and to all employees assigned to the contracts. Under proposed Federal mandates, you have the option of applying E-Verify to all existing employees covered by your MOU with USCIS. State laws apply (so far) only to new hires. Currently, different locations can enroll in E-Verify. </li></ul>
  54. 57. E-Verify: “Best Practices” <ul><li>Ultimately, given crazy patchwork quilt of state law and federal contractor mandates, once you are in E-Verify, you might as well apply it as broadly as possible. Caveat: there is only a 180 day window to roll it out . </li></ul><ul><li>Your HR Team needs 24/7 web-based access to I-9 and E-Verify processes to review real-time reports, monitor, train, and ensure compliance. You may not want to do it with the I-9 paper records and the government’s E-Verify software, which don’t link up and don’t issue alerts when work permits expire. </li></ul><ul><li>7. Cost/Benefit analysis. Compute the woman-hours needed to keep up with 5,000, 10,000 disconnected records. Avoid Risks of errors and “routine use of civil fines” per Morton at ICE. </li></ul>
  55. 58. E-Verify: “Best Practices” <ul><li>Same team responsible for I-9s should handle E-Verify. Avoid disconnect. Integrate payroll, I-9 and E-Verify software systems. </li></ul><ul><li>False TNC (non-confirmation notices.) Escalate for review by well-trained E-Verify team. There are technical exceptions and E-Verify is now adapting software to be more flexible. Ultimately, counsel has to weigh whether to continue employing worker while waiting for resolution vs. risks of civil fine for continuing to employ despite Government saying: “this person is not a match.”. </li></ul><ul><li>Use of E-Verify should eliminate risks of ICE audits and create “Safe Harbor” from liability for substantive violations on I-9 Forms. Government resources are focused elsewhere. Government should go after the “Don’t Ask, Don’t Tell Employers”, not those wired into the SSA and DHS databases. </li></ul><ul><li>Recent USCIS proposed rule-making and MOA between USCIS and ICE raise, however, concerns about sharing of data in the E-Verify system for enforcement purposes. </li></ul>
  56. 59. I am Ok You are OK <ul><li>BUT is my contractor/supplier OK? </li></ul>
  57. 60. Reducing Liability Risks from Contractors’ Immigration Violations: E-Verify Impact? <ul><li>What are the Issues? </li></ul><ul><li>Wal-Mart I </li></ul><ul><li>Wal-Mart II </li></ul><ul><li>“Constructive Knowledge”: How defined? </li></ul><ul><li>How does this whole area overlap with E-Verify? </li></ul><ul><li>Special Problem: state law compliance </li></ul>
  58. 61. E-Verify States in Red as of August 2009
  59. 62. “ Best Practices” For Reducing Risks from Contractors’ Immigration Violations <ul><li>Know your contractor, sub-contractor, most importantly your sub-sub contractor. </li></ul><ul><li>Your preferred vendor contracts do not preclude parceling out contract work to smaller companies who may not be immigration-compliant. Should they? </li></ul><ul><li>Review contracts. Don’t leave it all up to the IT or other Line Managers. </li></ul><ul><ul><li>Add indemnification and certification clauses, including obligation (at contractor expense) to hire outside auditor to verify that contractor’s employees are authorized to work. Wal-Mart and Verizon now impose these obligations on all contractors, who in turn flow-down these obligations to sub-contractors. </li></ul></ul><ul><ul><li>Prohibit any non-compete/liquidated damages clauses that preclude your recruiters/managerss from hiring away global talent from your contractors/subcontractors. </li></ul></ul><ul><li>Confirm enrollment of sub-contractors on federal contracts in E-Verify and in States where E-Verify now applies. Very confusing area right now. </li></ul><ul><li>Consider requiring subcontractors to enroll in E-Verify for new hires as part of commercial contracts, particularly when out-sourcing for IT services or labor services. </li></ul>
  60. 63. “ Best Practices” For Reducing Risks from Contractors’ or Other Company’s Immigration Violations <ul><li>Screen, centralize inquiries from workers requesting sponsorship for Green Cards so conflicts between status represented on I-9 Forms and status requested can be resolved. </li></ul><ul><li>Engage immigration counsel to assist with evaluation of requests by foreign national contractor employees to be hired directly by your company, evaluate legality under H-1B regulations of any employment contracts, payback provisions imposed by your contractors on employees. </li></ul><ul><li>M&A: special situation: due diligence, evaluation of I-9 Forms, status of any foreign national employees to avoid liability to successor firm. Allow for timely conversion of pending H-1Bs and Green Cards to new company. Avoid fines, violation of DHS and DOL regulations. Should you rely on E-Verify and I-9 filings of acquired company or re-start the process? Rules are currently different and/or in need of clarification. </li></ul>
  61. 64. CONCLUSION
  62. 65. Use of External Auditors <ul><li>Advantages: adds layer of good faith </li></ul><ul><li>Maintains Attorney-Client Privilege and Work Product </li></ul><ul><li>Practice of large users of outside contractors: Wal-Mart and Verizon </li></ul><ul><li>Means that if ICE “knocks” don’t have to scramble to secure representation unfamiliar with records </li></ul><ul><li>Assures up-to-date compliance as government rules change, litigation takes its course </li></ul><ul><li>Example: Social Security: Do we have a 30-90-93 Timetable and Safe Harbor or not? </li></ul><ul><li>Helpful in M&A situations: do we do new I-9s or not? What about E-Verify? </li></ul>
  63. 66. E-Verify Audit Checklist “Nuts and Bolts” <ul><li>Checklist has to cover timing and deadlines for completion of E-Verify and what happens if DHS or SSA issues a TNC to the employee </li></ul><ul><li>Checklists need to help you comply with differences between E-Verify and mandatory Federal Contractor and State E-Verify Rules </li></ul><ul><li>Checklists help identify employees who are exempt from E-Verify </li></ul><ul><li>Checklists ensure E-Verify is working as intended and provides your company with another “Safe Harbor” from civil sanctions and fines </li></ul>
  64. 67. CONCLUSION <ul><li>Reduce compliance risks with internal audit </li></ul><ul><li>You can’t fix what you don’t know </li></ul><ul><li>You will need outside help in organizing checklists and evaluating responses while maintaining attorney-client privilege </li></ul><ul><li>Sample, Issue Report Card, Train the Trainers and Certify: all this reduces costs of outside auditor help </li></ul><ul><li>Once controls are in place, annual checkup required and more frequently as government rules change, as occurred in April, 2009 with ban on use of expired documents in List A, or B and C </li></ul><ul><li>Bottom Line: Companies conducting internal audits remove themselves from any ICE target list </li></ul>
  65. 68. Questions ? <ul><li>Eliot Norman , Immigration and </li></ul><ul><li>Worksite Enforcement Team 804-783-6482 [email_address] </li></ul><ul><li>For updates: </li></ul><ul><li> </li></ul>
  66. 69. APPENDIX <ul><ul><ul><ul><ul><li>Immigration Documents </li></ul></ul></ul></ul></ul>
  67. 70. The New I-9 Form and List of Acceptable Documents
  68. 71. $110 Fine
  69. 72.
  70. 73.
  71. 74.
  74. 77. NEW LIST OF ACCEPTABLE DOCUMENTS EMPHASIS: “ ALL DOCUMENTS MUST BE UNEXPIRED” and Be more careful in Accepting List A Documents that show Identity and Work Eligibility
  75. 78. NEW I-9 FORM Effective April 3, 2009 Section 1 : Employee fills in but Employer Pays Fine if its not Correct or Complete: Data Used For E-Verify Translator/Preparer Certificate Section 2 : HR: Fills in Info From Originals of List A OR List B and C Documents HR Certification: “UNDER PENALTY OF PERJURY” Section 3 : HR Re-Verifies Work Authorization, again under “penalty of perjury” LIABILITY RISKS
  76. 79. Job Applicant Completes Section 1: BUT EMPLOYER PAYS THE FINES
  77. 80. Section 2: Avoiding Compliance Risks
  78. 81. Simple Case? <ul><li>Gopalan Balasubramanian </li></ul><ul><li>Indian Software Engineer that works on your Legacy IT Systems responsible for trillions of bits of data </li></ul><ul><li>Has a valid H-1b, walks in to do his I-9 on first day of work </li></ul>
  80. 85. Section 1: Not Complete but employee is saying: I only have temporary work permit by checking box X=“An alien authorized to work until” Section 2 HR Uses Drivers Lic & SS Card I-9 “Done Wrong” xxxxxxx xxxxxxxxxxxxxxxxxxxxxxx xxxxxxx xxxxxxxxx $375 Fine+
  81. 86. xxxxxxxxxxxxxxxxxxxxxxxxx Section 2: HR recognizes temporarily employed; Fills In List A with double combination of Foreign Passport and I-94 Card Section1: Employee completes data with # and Date. Determines how Section 2 to be completed by HR. I-9 Done “Right” TO DO: COME UP WITH SPREADSHEET REMINDER TO RE-VERIFY Section 3 July 15, 2010 Still have CONTINUING LIABILITY RISK
  82. 87. Job Applicant Completes Section 1: BUT EMPLOYER PAYS THE FINES