Making heads or tails of a compliant onboarding process

Making heads or tails of a compliant onboarding process

OnBoarding the World One Click at a Time

OnBoarding the World One Click at a Time

Presented by:

Rosette Cataldo

Vice President Business Development

KMS Software Company, LLC

• This presentation is intended for general information only and not as legal advice. 

• You should not rely on the information for any legal purpose, and contact your attorney to determine

applicability to your situation.

• SnagAJob.com & KMS Software disclaims all liability in respect to actions taken or not taken based on any

contents of this presentation.

The Small Print

• Who is KMS Software?

• Definition of OnBoarding

• Main “gotcha’s” in re: to new hire onboarding compliance

• Did you know??……tid bits to take away re: onboarding

Agenda

Who Is KMS?

Founded: 1994

Created industry’s first electronic OnBoarding solution: 1998

Industry’s only 100% OnBoarding provider

Expertise: Business Process Re-engineering, Workflow, Document Management, On-Line Forms and Electronic signature

Designated Agent of The Dept of Homeland Security

Hybrid (Direct & Channel) driven sales model

Servicing over 70,000 customer locations Locations strategically positioned throughout the U.S.

Privately held, MWBE (minority woman owned business enterprise)

KMS Software Company

Let’s start with your biggest risk

Onboarding: The Official Definition

The strategic process designed

to attract and engage new

employees, reaffirm their

employment decision, acclimate

them into the organization’s

culture, and prepare them to

contribute to a desired level as

quickly as possible. Source: Aberdeen Group, January 2009

Onboarding: The Unofficial Definition

“Getting the new hire’s paper work

filled out as quickly as possible so

the employee can get trained,

on the floor and behind the

counter servicing our customers

as fast as possible.”

Source: An Old Chicago Pizzeria Operator

KMS’ spin on The Unofficial Definition

“Getting the new hire’s paper work

filled out correctly and as quickly

as possible so the employee can

get trained, on the floor and behind

the counter servicing our customers

as fast as possible while keeping

me out of jail and my company’s

name off the front page of the newspaper.”

Three Buckets of Compliance

GovernmentCorporate,Franchise,Industry Operator Level

Everything you wanted to know about the Form I-9, ICE, and E-Verify

but didn’t want to ask

The Form I-9 – A brief History

1986 - Congress enacted the Immigration Reform and Control Act (IRCA) requiring all employers to verify the identity and work authorization of all individuals hired after November 6, 1986.

This requirement is implemented through:

1. The completion and execution of Section 1 of Form I-9 by the employee,

2. Submission to the employer by the employee of acceptable I-9 identity and employment eligibility documents and

3. The review and verification of these documents by the employer as documented on Section 2 of Form I-9.

As of April ’09, the new Form I-9 must be used.Expired supporting documents are no longer permissible .

I-9 Errors

Self-audit I-9s annually (or completed by a vendor)Common employee errors:

Sec. 1 incomplete One of the three boxes not checked Wrong box checked No Alien Number, Admission Number, or expiration date

Common employer errors: No signature/date in Sec. 2 No date of hire Sec. 2 not completed within three days of hire Documents copied and attached but Sec. 2 incomplete Accepted incorrect documents (hospital or foreign birth certificate, foreign

passport) Accepted too many documents Documents do not relate to individual

I-9 Errors

Correcting errors: Use different color ink, sign or initial, date change Draw a single line through incorrect information Do not use correction fluid or obliterate Write missing information or correct information nearby If correction is result of different documentation, so note Use current date; never back-date If I-9 is over-documented, cross out extra documents, sign, date Date and initial by person making the correction

Errors & Fines

Average Percentage of I-9’s completed with errors ~ 30% – 40%

Sample federally mandated fines:• For employers who fail to properly complete, retain, or make

I-9 Forms available for inspection, fines range from $110 to $1,100 per individual I-9.

• Employers who require certain or too many documents commit document abuse and violate anti-discrimination provisions of the Immigration and Nationality Act (“INA”). Fines for document abuse range from $110 to $1,100.00 for each individual discriminated against.

• .

Bet you didn’t know….

Keeping copies of List A & B or C documents:• Not required by federal law, but permitted (Colorado requires)

• Upside: May be helpful for internal audits or as evidence in charges of fraud or discrimination

• Downside: May establish liability

• Practice of copying or not copying must be consistent

• Simply attaching copies to I-9 doesn’t relieve employer of responsibility to complete I-9 properly

Hot off the presses

New Puerto Rico Birth Certificates Effects I-9 Process

The government of Puerto Rico passed legislation that invalidates all Puerto Rican birth

certificates issued before July 1, 2010

Beginning Oct. 1, 2010, employers may only accept certified copies of Puerto Rico birth

certificates that were issued on or after July 1, 2010.

This means that if an employee presents a birth certificate issued by the Vital Statistics

Office of the Commonwealth of Puerto Rico, the employer must look at the date the certified

copy of the birth certificate was issued to ensure that it is valid.

Employers must not re-verify the employment eligibility of existing employees who presented

a certified copy of a Puerto Rico birth certificate for Form I-9 purposes prior to Oct. 1, 2010.

Unauthorized Aliens can cost you big time

If DHS determines that you have knowingly hired unauthorized aliens (or are

continuing to employ aliens knowing that they are or have become

unauthorized to work in the United States), it may order you to cease and desist

from such activity and pay a civil money penalty as follows:

1st Offense Not less than $375 and not more than $3,200 for

each unauthorized alien 2nd Offense Not less than $3,200 and not more than $6,500 for

each unauthorized alien Subsequent Offenses Not less than $4,300 and not more than $6,000 for

each unauthorized alien

How are fines determined?

In determining the amount of the penalty, DHS considers:

1. The size of the business of the employer being charged

2. The good faith of the employer

3. The seriousness of the violation

4. Whether or not the individual was an unauthorized alien

5. The history of previous violations of the employer.

What is E-Verify and Why Participate?

• A federally driven program that helps protect employers from hiring/employing unauthorized or undocumented workers unknowingly

• The E-Verify system is an Internet-based system operated by DHS USCIS, in partnership with the SSA, that allows participating employers to electronically verify the employment eligibility of their new-hire or existing workforce.

• Before an employer can participate in the E-Verify program and use the E-Verify system, the employer must enroll in the E-Verify program and agree to the E-Verify Memorandum of Understanding (MOU) required for program participants.

E-Verify – how does it work?

Manually key in data & manually manage results

Automatically have I9 data uploaded from an electronic I-9 using a web services designated agent

or

E-Verify – how does it work?

Result: Work Authorized

Result: Tentative Non-Confirmation

Result: Case Incomplete Photo-Matching Required

Tentative non-confirmation – now what?

Tentative Non-Confirmation (TNS) Process

Ability to correct misinformation, then re-submit• called a “SSA or DHS re-verify”

If still issue, then the tentative non-confirmation contest process begins.

The employee must decide if they want to contest or not contest the TNC results.

Contest: Sign 2 forms. Physically got to SSA to rectify situationHave 8 federal government work days to do so

Not contest: Employment will be terminated

Case Incomplete – now what?

Case Incomplete Photo Matching Process

Applicable to Permanent Residents and Aliens Authorized to Work.

E-verify will instruct you to look at I-551 or I-766 documents to match the pictures.

The document on screen and tangible hard copy document must match.

Common Questions re: E-VerifyQ: When is the earliest I can initiate a query using E-Verify?A: After offer is accepted & Form I-9 is filled out completely.

No later than three business days after start date can query be initiated.

Q: Can I use E-Verify if the employee does not have a Social Security Number yet?

A: E-Verify can not be used for employees that do not have SSN yet. You should complete I-9 and wait to run E-Verify query until you have SSN. You should note on Form I-9 why you are delaying E-Verify query. The employee is allowed to work temporarily.

Common Questions re: E-Verify

Q: Can I terminate using E-Verify at any time?A: Yes

Q: Does Participation in E-Verify provide Safe Harbor from Worksite Enforcement?

A: No. However, an employer who verifies work authorization under E-Verify establishes a rebuttable presumption that it has not knowingly hired an unauthorized alien.

– According to recent USCIS Press Release, 99.6% of all employees who are authorized to work in the United States are verified through E-Verify without receiving a tentative non-confirmation (TNC) or having to take any type of corrective action.

– Non-confirmations occur almost exclusively because: o The employee is not authorized to work in the United States o The employer made an error when entering information into the E-

Verify system. – E-Verify returns initial verification information within 3 to 5 seconds.– USCIS estimates that it takes an average of 12 minutes to learn about,

complete, assemble, and file the I-9 form. • Automation of the process with the KMS OnBoarding can replace this

process by greater than 60%

E-Verify – is it fast & accurate?

E-Verify: Strong and Growing

• Over a dozen states currently require use of E-Verify for public and/or private employers and many more are considering mandating its use

• Approximately 170,000 businesses nationwide currently using the federal E-Verify program

• More than 1,200 employers per week register for the new program and approximately 83 % report that they are satisfied with its performance

Source: xxx

States requiring all employers to verify employment eligibility via E-Verify:• Mississippi, Arizona, South Carolina, and Utah

States requiring certain employers and state agencies to verify the employment eligibility of new-hires by using the E-Verify system:

• Alaska, Colorado, Georgia, South Carolina, Idaho, Missouri, Minnesota, Pennsylvania, Oklahoma, and Rhode Island

Additionally…• Tennessee encourages employers to use E-Verify • California, Colorado, Florida, Iowa, Illinois, Indiana, Kansas, Minnesota, Missouri,

New Jersey, Pennsylvania, Rhode Island, Tennessee and West Virginia are considering new immigration laws involving E-Verify

Source: Law Firm of Fisher & Phillips

1

State-By-State Breakdown on E-Verify

How We Got to Where We Are Today…

• House Appropriations Committee approved a 2 year extension of the E-Verify program – extending funding through fiscal year 2012

• On August 26, 2009, a U.S. District Court issued a long-awaited decision in Chamber of Commerce of the United States of America v. Napolitano passing a law (FAR Case 2007–013, Employment Eligibility) requiring that federal contractors use E-Verify to check the employment eligibility of all newly hired employees, as well as all current employees directly working on a contract.

• The rule went into effect on September 8, 2009.  This deadline means that most federal contracts awarded, as well as solicitations issued after September 8, 2009, must include a clause mandating use of E-Verify for all employees hired during the contract period and all existing employees assigned to perform work under the contract. 

What is FAR?

• FAR is an acronym for Federal Acquisition Regulation

• The FAR rule requiring use of the E-Verify system: • Only affects federal contractors who are awarded a new contract after September 8, 2009

that includes the Federal Acquisition Regulation (FAR) E-Verify clause (73 FR 67704).

• Implements Executive Order 12989, as amended by President George W. Bush on June 6, 2008, directing federal agencies to require that federal contractors agree to electronically verify the employment eligibility of their employees.   The amended Executive Order reinforces the policy, that the federal government does business with companies that have a legal workforce.

• Rule requires federal contractors to agree, through language inserted into their federal contracts, to use E-Verify to confirm the employment eligibility of all persons hired during a contract term, and to confirm the employment eligibility of federal contractors’ current employees who perform contract services for the federal government within the United States.

Proper Use of the E-Verify System with FARS

• FAR does allow a Federal Government contractor to run their entire workforce through E-Verify or just those U.S.-based employees( including: Puerto Rico, Guam, DC & US Virgin Islands)working on a contract that includes the FAR clause.

• You should not have to run your existing employee through E-Verify if:– The employee was hired BEFORE November 6, 1986– Your employee has federal security clearance– The employee was previously verified by your company

• If you do run your entire employee population through E-Verify, you have 6 months to do so.

• If you do run only your employees working on a Federal Government contract, you have 90 days after contract award to run those employees through E-Verify.

• If you company is not yet set up with E-Verify, you have 30 days to enroll from contract award date, then 90 days to run employees through E-Verify.

Proper Use of the E-Verify System with FARS

• If you are already enrolled in E-Verify you must update your company profile to state that you are a Federal Government Contractor

• If you already have a contract with the Federal government and it is to continue for 6+ months or is an “indefinite-delivery/indefinite-quantity” the contract will need to be modified to include E-Verify clause.

• Some Federal contracts do NOT require participation in E-Verify:

– Contract must be over $100,000– Contract must extend beyond 120 days– Contracts performed outside USA– Commercial Off The Shelf (COTS) items– Items sold in commercial market place or substantial quantity

• Very important final note re: FARS:

– If you pull data from a legacy Form I-9 of an existing employee the Form I-9 must be audited to confirm many criteria on that Form I-9 conform with new Form I -9 requirements.

Final thought on E-Verify

“While not perfect, it is important to note that E-Verify is much more effective than the Form I-9 verification process used by employers not using E-Verify. E-Verify also deters many unauthorized workers from even applying for jobs with participating employers.”

HR magazine, April 2010

ICE, ICE, Baby!

• The U.S. Immigration and Customs Enforcement (ICE) is the largest investigative branch of the Department of Homeland Security (DHS).

• ICE is responsible for enforcement of the penalty provisions of IRCA.

• ICE key initiative: Lawful Workforce and Employer Accountability

“Employers have an obligation to verify that their employees are legally able to work in the United States. ICE seeks to create a culture of compliance that supports those companies that want to obey the law, while holding those that do not accountable for their actions.”

Source: ICE Fiscal Year 2008 Annual Report

The Role and Impact of ICE

• In FY08, ICE began subjecting offending employers to debarment proceedings which can prohibit companies from receiving or competing for federal contracts. Debarment proceedings were launched against seven companies.

• Under federal regulations, contractors may be considered for debarment if they have been found to have either knowingly hired an unauthorized worker or continued to employ an alien once he or she became unauthorized (for example, after a work visa has expired).

Many of those arrested face criminal charges for identity theft and Social

Security fraud

ICE Enforcement Trends

• In FY ‘08, ICE worksite enforcement actions resulted in 1,103 criminal arrests and 5,184 administrative arrests.

• Of the criminal arrests, 135 were owners, managers, supervisors or human resources employees who face charges that include harboring or knowingly hiring illegal aliens.

• ICE secured nearly $21 million in criminal fines, penalties and forfeitures against employers in worksite enforcement investigations.

Authorities Raid Sizzler Restaurants, Arrest Undocumented Workers

“The raids were part of a yearlong investigation into whether the operators of the two Sizzler locations broke a civil law by knowingly hiring illegal immigrants, Maricopa

County Sheriff's Office Lt. Brian Lee said in a statement”

Tip from a fired employeeEmployee claimed he had been fired for his refusal to hire employees

without the proper documents

Net result: Arrested nine (9), Bad Press

6/12/10 – Associated Press

• In April, Michel Malecot, the chef of a popular bakery in San Diego, was indicted on 12 criminal counts of harboring illegal immigrants. The government is seeking to seize his bakery. He has pleaded not guilty.

• In Maryland, the owner of two restaurants, George Anagnostou, pleaded guilty last month to criminal charges of harboring at least 24 illegal immigrants. He agreed to forfeit more than $734,000

Food Services & ICE

“The Obama administration has replaced immigration raids at factories and farms with a quieter enforcement strategy: sending federal agents to scour companies’ records for illegal immigrant workers.”

What’s new ….

What is an ICE Audit?Sending federal agents to scour companies’ records for illegal immigrant workers.

Net result?• The goal of an audit is to create a “culture of compliance”

among employers so that verifying new hires as common as paying taxes.

• Audits leave it up to employers to fire workers whose documents cannot be validated.

• An employer who fails to fire an employee risks prosecution

Raids vs. Audits

ICE Audits• Also known as “Silent Raids”• Audits force business to fire all workers, not just those working that

day (when compared to raids)• Audits allow for greater efficiencies of ICE; thereby likely to grow• Over the past year, ICE has conducted audits of employee files at

more than 2,900 companies.

More on ICE Audits

• Auditors contact the employer with Notices of Inspection (NOIs) • Provide 72 hours notice before coming onsite and inspecting the employers

Forms I-9s. • ICE auditors examined I-9’s, which all new hires in the country must fill out.

ICE then advises if SSN and immigration numbers do not check out with federal databases. (I9’s can be presented in electronic form)

• Based on the results of the audit, any illegal workers are processed and the employer faces potential fines and other actions.

• Ice may return and audit the employer again to make sure any corrective action has been taken.

• ICE agents reviewed more than 85,000 Form I-9s and identified more than 14,000 suspect documents - approximately 16 percent of the total number reviewed

ICE Audits – What happens?

After ICE

Who manages process after ICE?• Fugitive Operations • Enforces that if you are told to leave USA, you

actually do• Local level• Knocks on doors, deports aliens on the spot

Final thoughts

• April 29, 2005– Present, sign & store Form I-9 electronically

• Changed the acceptance of e-signature– W-4– State tax forms– Corporate Forms

• Only one form you can’t use e-signature (8850)

Best way to stay compliant

• Training• Audit• Don’t neglect current your I-9’s• Leverage automation• Pull people out of the process as much as

possible

Using Automation

• Electronic onboarding is growing in popularity worldwide

• Best in class tools are:– simple, allowing varying types of employees to easily use the

solution– populate forms with data fields keyed in by the new hire– Fields & forms have rules, so errors can’t be made– Data can be exported to HRIS, Payroll, POS, time & attendance

• Forms stored automatically, easy retrieval, secure

Using Automation

• ROI is often immediate & recognized in many area

• Creates greater organizational efficiencies

• Reduces errors

• Green factor

• Require little to none IT intervention

Bottom line….

An automated Onboarding process creates a compliant, documented, repeatable process

and allows your managers to

focus on your people and

not their paperwork.