AVOID SKATING ON THIN ICE

Form I-9 Compliance, Audits, Penalties and Appeals

Introduction

Speaker background Session Overview

Employer’s Duty to Complete and Maintain Form I-9

Common Errors and istakes Recommended Compliance Policy Provisions Benefits of External Audit Responding to Enforcement Action

Duty to Complete and Maintain 7th Edition– mandatory use May 2013 The new form is 2 pages

Page one completed by new hire no later than first day of work for pay

Section 2 on page 2 completed by employer no later than 3rd business day the employee starts work for pay

Section 3 on page 2 completed only if work authorization expires

Section1

Employer Responsible to Verify: Employee provided information in all required

fields Employee signed and dated the form Ensure preparer/translator section has been

completed, signed and dated (same date as employees signed) if applicable

Note whether employee indicated whether employment authorization will expire

Section 2, Employer Review and Verification Employer responsible for completing section

2 and must physically examine the documents presented by the employee, and sign the form.

Documents Lists: A – identity & authorization B – identity only C – work authorization only

Examining Documents

If new employee presents documents that do not appear to be genuine, reject the document and ask for other documents that satisfy the requirements.

If employee writes name that differs from documents, ask employee for reason for difference.

Attach a memo to I-9 explaining discrepancy

Section 3, Reverification and Rehires Employer may complete Section 3 when:

Employee’s employment authorization or documentation of employment authorization has expired

Your employee is rehired within 3 years of the date that Form I-9 was originally completed

Your employee changes his or her name

Correcting Form I-9

Employers may only correct errors made in Sections 2 or 3

If you discover an error is Section 1, ask the employee to correct the error

The best way to correct the form is to: Draw a line through the incorrect information Enter the correct information Initial and date the correction

Retaining Form I-9

Date employee began work for hire Add three years to that date: X

Date employment was terminated Add one year to that date: Y

Which date is later: X or Y? Employer must retain I-9 the later of the two

dates.

Storing Form I-9

No matter how you choose to store Form I-9, you must be able to present to government officials within 3 days.

Original Paper or Electronic Include controls to ensure the integrity,

accuracy and reliability of ESS. Include controls to ensure an audit trail so

that any alteration or change can be accessed

Common Errors and Mistakes M&D Masonry Case Study March 11, 2014, OCAHO assessed penalty

of $228,000 to a Georgia construction contractor based on a 2010 audit.

M&D produced 342 I-9s as result of NOI. ICE issued NIF alleging 339 violations

87 failures to prepare and/or present I-9s 252 violations for failures related to Sections 1 & 2

Common Errors and Mistakes OCAHO’s decision detailed the errors found

on the 252 Form I-9s:

34 failures to ensure employees signed the attestation in Section 1

60 failures to ensure employees checked the status box in Section 1

3 failures to ensure employees checked only one status box in Section 1

Common Errors and Mistakes

10 failures to ensure employees who attested to status as lawful permanent residents entered their respective alien numbers (A#)

81 occasions where the employer representative failed to sign Section 2

21 occasions where the employer failed to record the issuing authority for a List B document (driver’s license)

25 employer failures to provide the document number for a List A, B or C document

Common Errors and Mistakes

7 occasions where the employer recorded unacceptable documents or provided insufficient information about a document

Based upon an 84% error rate, ICE assessed a baseline penalty of $935 for each violation. ICE enhanced the penalty 10% due to seriousness of violation and the employer’s large size, and reduced the penalty by 5% for good faith.

Compliance Policy Provisions

Developing and implementing a written Form I-9 Compliance Policy is critical. Five essential elements: Who is in charge of I-9 Compliance How to complete the form to avoid common

mistakes Should supporting I-9 documents be retained Is the company using (or required to use) E-Verify How should I-9 forms be stored and purged

Compliance Policy Provisions Appoint an I-9 Responsible Officer

The larger the number of employees involved in the I-9 process, the larger the I-9 error rate

RO last person to view I-9 before it is recorded in any tickler system and filed

RO authority to go to HR employee who completed Section 2 to correct any mistakes/omissions

Maintain purge and re-verification

Compliance Policy Provisions

Mandate semi-annual training for all HR employees that are tasked with completing Section 2.

Review and revise all I-9 Reverification Procedures

Conduct Annual Voluntary I-9 Audits

Benefits of External Audits

Historically self-auditing does not typically reduce fines, and often result in additional liability exposure caused by mistakes such as: Redoing all I-9s and throwing away originals Separating document copies from Form I-9s Making corrections without initialing and dating Inserting backdated information Failure to complete audit

Benefits of External Audits External audit performed by counsel can:

Identify forms that need corrections and provide a forum for all corrections to be made

Provide statistics on form error rates, instances of particular errors, and incidences of errors for staff members responsible for completing the form

Estimate civil fine liability Uncover undocumented workers and missing I-9s Identify I-9 forms that can be legally purged

Benefits of External Audits

Properly completed external audit can provide good-faith defense to ICE audit

Start 5 year statute of limitations on corrected substantive errors

Audit results may be protected from disclosure under work product doctrine

Impact of Sarbanes-Oxley Act of 2002

Responding to Enforcement Action Department of Homeland Security (ICE/HSI) Office of Special Counsel for Immigration

Related Unfair Labor Practices Department of Labor

Employers will generally receive a written Notice of Inspection (NOI) at least three days before the inspection Contact LEGAL!!! Can obtain additional time

Responding to Enforcement Action Employer must retrieve and reproduce

electronically stored I-9s Provide officer with necessary hardware and

software to inspect electronic documents Provide any existing electronic summary of

the information recorded on I-9s Produce retained original paper Forms I-9

and any related documents

Responding to Enforcement Action Notice of Inspection Results – “compliance

letter” Notice of Suspect Documents Notice of Discrepancies Notice of Technical or Procedural Failures Warning Notice Notice of Intent to Fine

Responding to Enforcement Action

Companies may attempt to negotiate reduced finesRequest review of fine by administrative law judge (OCAHO) within 30 days of receipt of NIFAppeal OCAHO decision to Federal Circuit Court of Appeals

For Further Information Contact

Ryan J. Hatton

Halleland Habicht

33 South Sixth Street, Suite 3900

Minneapolis, MN 55402

612-836-5504

rhatton@hallelandhabicht.com