AILA Spring Conference 2015 Texas New Mexico Oklahoma

AILA Spring Conference 2015 Texas, New Mexico, Oklahoma Chapter I-9, E-Verify & Trends in Workforce Enforcement Paige Taylor ptaylor@fragomen. com (469) 791 -0360 Maggie Murphy Maggie. Murphy@jacksonlewis. com (512) 362 -7402 (direct)

The World of Immigration Compliance �Regardless of whether you have a single foreign national employee, immigration law is still relevant. �Compliance and peace of mind during a time of corporate investigation and prosecution. �Terms of Interest E-Verify, I-9, internal audits, social security Best Practices Representation in criminal-immigration investigations, worksite raids, federal contract debarment actions, subcontractor liability

The NEW Form I-9 �The government is enforcing immigration law by shifting the obligation to employers to be compliant or face heavy fines. �The Form I-9 is the essential tool for employment compliance with immigration law. �The Form I-9 is required for every current employee hired after November 6, 1986. �A two-page form with over 70 pages of instruction and over 80 different kind of potential errors

Key Issues with the New I-9 � New I-9 must be used after May 7, 2013. � Form has been separated into 2 pages. � Greater information gathering for potential audits. � Changes to the list of acceptable documents. � Increased clarity on instructions. � M-274 Handbook for Employers UPDATED on 3/8/13.

I-9 Best Practices o Establish hiring and employment verification policy o Establish an internal compliance and training program o Ensure I-9 Form process is conducted by trained individuals o Annual I-9 audits o Consider electronic I-9 program o Ensure contractors and subcontractors establish procedures to comply with employment eligibility requirements o Establish and maintain appropriate policies, practices and safeguards to ensure authorized workers are not treated differently with respect to hiring, firing, etc. because of citizenship status or national origin o Maintain copies

I-9 Enforcement ICE Enforcement Efforts by the Numbers 3 500 3 000 2 500 2 000 1 500 1 000 500 0 FY 2008 FY 2013 I-9 Audits 503 3 127 Criminal Arrests 135 452 Final Orders 18 637 FY 2013 Fines = $15, 808, 365. 00 Debar. (indiv. ) 0 277

Audit & Investigation Triggers �Random Audit. �Targeted Audit Due to Industry. �Re-Audit. �Employee Complaints. �Referral From Another Government Agency. �Random Complaints to ICE Hotline.

Anatomy of an Audit �Notice of Inspection: 3 days to submit all I-9 s. �Notice of Technical Errors: 10 days to correct all technical errors. �Notice of Suspect Documents: Potential termination of employees and creation of a fearful employee base. �Notice of Intent to Fine: Stiff penalties for simple errors. �Notice of Debarment from Federal Contracts: Loss of federal contracts and new federal contract bids. Could lead to Criminal Prosecution.

Current Civil Penalties o Violations of I-9 requirements: $110 - $1, 100 per I-9 o Knowingly hired or continuing to employ: $375 - $3, 200 per worker o Pattern or practice: $3, 300 -$11, 000 o Debarment from government contracts for “knowingly employing an unauthorized worker” o Criminal penalties: fines and/or imprisonment

ICE Fine Calculations Fine calculations made strictly on the following factors: 1) Percentage of substantive errors and uncorrected technical errors (+50% error rate = $935 per form fine) 2) Previous offenses can double or triple the fines 3) Mitigating factors: Business size, good faith, seriousness of violation, unauthorized aliens, history. (Mitigating factors can increase the total fine by 25%)

Hypothetical Hypo Corporation has 100 employees currently on payroll and terminated 20 employees in the past year. ICE requests all I-9 s for current employees and employees terminated within the past year. Hypo Corp’s HR manager finds all I-9 s of the current employees and 15 of the terminated employees I-9. Assuming the employer has a typical rate of failure (50%), what is the fine the ICE will likely impose.

Answer Assuming ICE finds 50% of your I-9 s have failed or were not corrected, 60 I-9 s would be considered to have substantive violations. Applying a standardized I -9 calculation, the file would be 60 X $935 for a total fine of $56, 000 or higher.

Federal Contract Debarment A first time offender with a single count of knowing to continue to employ an unauthorized foreign national can be recommended for Federal Contract Debarment.

Impact of Audits on Business Operations � Abercrombie & Fitch (2010) – Involved the investigation of the Michigan stores of Abercrombie & Fitch (note – only the Michigan stores were impacted by the investigation, it did not go nationwide), resulting in fines for paperwork/technical violations only of $1, 047, 110. That’s over a $1 M fine for just technical violations, in just the Michigan stores. The investigation started in one store in Michigan in 2008, and the fine was assessed two years later after the investigations spread to all stores in that state. The company had moved to its own electronic I-9 system that it created on its own. � American Apparrel (2009) – In 2009, American Apparel had approximately 5600 U. S. employees. After conducting an investigation for approximately 18 months, ICE notified the retailer that it suspected that the documents from approximately 1600 employees were fraudulent, and that it could not verify the information presented by another 200 employees. The company was forced to provide notices to these affected employees that they would have to meet with ICE officers and present valid documents or face termination. The audit of their paperwork continued and was expanded to a national level.

E-Verify at a Glance • A “no cost” electronic system run by the Department of Homeland Security (DHS) for employers to confirm employment authorization online of newly hired employees and current employees assigned to work on a qualifying federal contract • System automatically compares information from Form I-9 against the SSA and DHS databases • Employers must still complete the Form I-9 Copyright 2013 Law. Logix Group, Inc.

E-Verify Results Employment Authorized The employee is authorized to work. Tentative Nonconfirmation (TNC) There is a mismatch between information submitted and the government databases Final Nonconfirmation (FNC) Employer is instructed to terminate employment Copyright 2013 Law. Logix Group, Inc.

Is E-Verify Accurate? • E-Verify accuracy has improved during the past few years primarily through an expansion of available databases and better quality control procedures • 98. 65 percent of employees are automatically confirmed as authorized to work • The remaining 1. 35 percent of employees receive initial system mismatches: • 0. 26 percent are later confirmed as work authorized after contesting and resolving the mismatch • 1. 09 percent are not found to be work authorized Copyright 2013 Law. Logix Group, Inc.

E-Verify Participation • Nearly 483, 000 employers are enrolled in EVerify, which represents more than 1. 5 million hiring sites • This is up nearly 80, 000 since 2012, and almost 200, 000 since 2011 (several states made EVerify mandatory starting in 2012) • Congress approved an extension of E-Verify through September 2015 • For the most part, E-Verify legislation on the federal level is supported by both parties Copyright 2013 Law. Logix Group, Inc.

Who MUST Participate • Employers in Arizona, Alabama, Louisiana, Mississippi, Georgia, Tennessee, North Carolina, South Carolina, and many others! • Employers with a qualifying federal contract or sub-contract • Employers wishing to take advantage of the F -1 STEM OPT Rule Copyright 2013 Law. Logix Group, Inc.

E-Verify Map Copyright 2013 Law. Logix Group, Inc. December 27, 2021

E-Verify Planning �Which hiring sites will (or must) participate? �Technology requirements �Identify any past corporate mergers or acquisitions and compile a list of corporate names and federal tax ID numbers used �Identify the existence of any type of E-Verify account which may have been setup in the past, the geographic scope of the E-Verify use, and the periods of time for system use Copyright 2013 Law. Logix Group, Inc.

E-Verify Compliance Issues �TNC Compliance �Photo Matching Issues �Managing I-9 vs. E-Verify Requirements �E-Verify Misuse by Employers �E-Verify RIDE program in some states �State DOL Activity in E-Verify States �E-Verify Monitoring & Compliance “Desk Reviews” December 27, 2021

The Dreaded “TNC” �You just received a TNC: Don’t Panic! There are many legitimate reasons Misspellings in government database or E-Verify query Name changes due to marriage, divorce, or naturalization “How do you spell your name again? ” or which of the following is not like the other: � Jose Maria Garcia Vasquez � Jose Maria Vasquez Garcia � Jose Maria Garcia-Vasquez �The employee has 8 Federal Government workdays from the date of referral to visit or call the appropriate agency to resolve the discrepancy Copyright 2013 Law. Logix Group, Inc.

SSA and DHS Mismatch Issues �Does the employee have to do this on his or her own time? �How does the employer follow-up? �My employee visited the SSA office and “cleared everything up”. Why am I getting an FNC? �Slightly longer process (DHS Verification followed by TNC) �Difficult for employee to determine what caused the TNC �Common problems for L-1 blanket employees, J-1 s and H -1 Bs changing employers Copyright 2013 Law. Logix Group, Inc.

E-Verify Photo Matching �Allows you to match the photo on a document to the photo that DHS has on file for that employee Employment Authorization Document (Form I-766) Permanent Resident Card (Form I-551) U. S. Passport or Passport Card �If presented, employers must retain a photocopy of the document and retain it with the Form I-9 �Employers prohibited from requesting specific documents in order to activate the E-Verify photo matching process Copyright 2013 Law. Logix Group, Inc.

E-Verify vs. Form I-9 �Requiring Specific Documents during the I-9 Verification Process constitutes “Document Abuse” (with only very limited exceptions). �However, E-Verify requires employers to: Obtain employee’s SSN on the Form I-9 Only accept a List B document with a photo Photocopy certain supporting documents (Green card, EAD, and US Passport) �Federal contractors may also need to request information from current employees in order to submit to E-Verify Copyright 2013 Law. Logix Group, Inc.

E-Verify Misuse � Pre-screening employment applicants � Using the program selectively based on a suspicion of unauthorized status or based on national origin � Firing an employee during the TNC process � Submitting current (existing) employees to E-Verify (when the employer is not a qualifying federal contractor) � Not properly referring the employee to the SSA or DHS to resolve a TNC � Completing new I-9 s for employees when it is not warranted Copyright 2013 Law. Logix Group, Inc.

E-Verify Ride �E-Verify + State Law Enforcement data sharing �Verification of State Driver’s License Information (but no photos yet) �E-Verify web interface now asks for List B and C titles (ID vs. Driver’s License) �Mississippi (June 2011) and Florida (December 2012) are the only 2 states participating Copyright 2013 Law. Logix Group, Inc.

State DOL Audits for E-Verify Data �State E-Verify Legislation in several states authorizes and funds the creation of E-Verify compliance audits to make sure employers are following state law �Now every DOL visit can result in a request for EVerify Compliance data �Often have 15 -30 days to respond �Tennessee and Mississippi are the most active �Can provide a report from E-Verify showing data Employers are not the only ones running reports E-Verify reporting has become increasingly robust State Auditors and Investigators are receiving training from EVerify on how to run and read reports

E-Verify Monitoring �USCIS uses algorithms to detect patterns of potential program misuse based on certain “behaviors” �E-Verify produces monthly non-compliance reports, communicate with employers principally via e-mail, then conducts a 90 -day look-back to see if corrective steps have been taken �E-Verify may also conduct a desk review or onsite visit & refer cases directly to other government agencies in the event of issues �E-Verify is sharing this information with DHS and DOJ Copyright 2013 Law. Logix Group, Inc.

QUESTIONS?