Progressive Business Conference. New I 9 Rules

Mary E. Pivec, Esq.Keller and Heckman LLP

1001 G Street N.W., Suite 500WWashington, D.C. 20001

[email protected]

www.khlaw.com

Washington, D.C. ● Brussels ● San Francisco ● Shanghai

The New I-9 Employment Verification Rules and the Future of Immigration Worksite Enforcement:

Critical Issues to Know

Presented Through the Progressive Business Conference

February 17, 2009

by

2│ www.khlaw.com │ KELLER AND HECKMAN LLP Copyright © 20082

Agenda Topics

• Update on pending Form I-9 regulatory changes• Best Practices: Immigration and I-9 Compliance • Ten Most Serious I-9 Mistakes• Current Civil Money Penalties• Update on E-Verify and FAR E-Verify rule Update on

SSA No Match and DHS Safe Harbor Rule• Worksite Immigration Crimes and Penalties • Anticipating ICE enforcement actions• Preparing for potential worksite investigations


on New I-9 Rule

• DHS proposed 2/2/09 effective date• Obama Administration has suspended

the proposed effective date for 60 days, pending further study, and has extended the comment period through March 4, 2009

• I-9 Form dated 6/7/07 remains valid pending further notice


Bush Administration Proposals Now in Limbo

• Modify the Employee attestation in Section 1 to include a new immigration category (non-citizen national)

• Require (for the first time) that all verification documents be current (including USC passports, alien registration cards, and driver’s licenses); updating not required when USC passports, ARC’s and DL’s expire.


Bush Administration Proposals Now in Limbo

• Remove outdated work authorization documents from Column A (I-688 and I-688A; I-151)

• Add current passports issued by FSM or RMI with Form I-94 indicating admission under the CFA to Column A documents

• Add USC ID card (Form I-197) and Identification Card for Resident Citizen in the United States (Form I-179) to Column A documents


Current Status of Proposed I-9 Regulation

• Implementation stayed 60 days pending review by Obama DHS

• Comment period extended through March 4, 2009

• Where does that leave employers?


Best Practices: Immigration and I-9 Compliance

• Promulgate Immigration Compliance Policy (with sanctions for non-compliance), consistent with EEO laws, and disseminate companywide

• Train all managers and supervisors in requirements of the Compliance Policy, including need to report promptly concerns of alleged violations

• Ensure that all Employer representatives with responsibility for completing Section 2 receive basic I-9 and document fraud training and regular refresher training whenever changes occur in the regulations



• Institute Tip Line to report violations of Employer Immigration Compliance policy and promptly investigate and resolve all alleged violations

• Consider enrolling in SSNVS or E-Verify to deter immigration fraud

• Conduct annual I-9 compliance audits to ensure that all employees have a properly completed I-9 on file with the Employer; correct errors conspicuously and retain all prior I-9 forms and verification documents



• In the hiring process, do not ask about national origin or citizenship status May ask whether candidate is legally authorized to work for

the Employer in the United States If the candidate says “no” – do not extend job offer If the candidate equivocates – ask why the candidate is

unsure of status If the candidate says “yes” – no follow up questions are

permitted • Before requiring any individual to complete a Form I-9 there

must be an employment offer and acceptance of record


Best Practices: Immigration and I-9 Compliance, cont’d

• After offer and acceptance, an Employer may provide the new hire with copy of proper Form I-9, instructions for completion and a list of acceptable documents – even if prior to scheduled start date – and may condition offer upon proper completion of the verification requirement, including SSNVS verification or E-Verify process

• Alternatively, if the individual was previously employed by the employer If employment terminated less than three years prior to proposed

new start date and candidate completed an I-9 during prior employment, employer may rely on properly completed prior I-9, unless the Employment Authorization document (other than US passport, I-551) has expired

Policy must be applied across-the-board within company, division, department, or job category to avoid claims of discriminatory treatment



• Insist that Employee properly and fully complete and execute Section 1 before the close of the first day of employment Do not pre-complete Section 1 for the Employee If Employer representative assists Employee in translating or

completing Section 1, the representative must complete the Preparer/Translator attestation

Providing SSA# in Section 1 is optional, unless the Employer is participating in E-Verify

Currently, Employee must check one of three immigration status boxes. If s/he checks the second box, s/he must provide an A#. If s/he checks the third box, s/he must provide either an A# or Admission # and the expiration date of the work authorization document



• Insist on seeing original documents only to verify identity and work eligibility

• Do not accept any document if the Employer has credible evidence that it is fake

• Pending finalization of Bush Administration I-9 regulation, accept expired USC passports and I-551 as Column A documents

• Verify consistency between information provided by Employee in Section 1 and information contained on the face of verification documents Compare names, birth dates, registration numbers,

expiration dates and likenesses; do not accept documents with discrepancies



• Don’t accept receipt for application for initial or extended EAD• May accept and record receipt for new or replacement SSC for period

of 90 days• May accept and record receipt for replacement US birth certificate,

ARC, or EAD for period of 90 days• Record the identification number and expiration dates of all required

documents• Do not over-document, particularly based upon citizenship or national

origin status Do not insist on seeing ARC card, even if PR status claimed in Section 1 Do not insist on seeing DHS/EAD, even if EAD status claimed in Section 1

• Copy and retain verification documents along with I-9 documents• Fully complete and execute the Employer attestation in Section 2 no

later than 3 days following the start date of employment (recorded in Employer attestation)



• Track future EAD expiration dates and notify employees of need for I-9 update no less than 120 days prior to expiration dates

• Remove any Employee who fails to properly update work authorization status as of prior expiration date

• Accept any document minimally acceptable to establish continuing work authorization, unless the employee has admitted facts and circumstances sufficient to place a reasonable employer on notice that the document may not be valid and/or not relate to the employee

• Maintain copies of all updates with the original I-9 form relating to the Employee

• Provide for secondary review off all I-9 forms prior to finalization of the I-9 hire or update procedure


Ten Most Serious I-9 Mistakes

1. Employer fails to require Employee to complete Section 1 of the Form I-9 prior to close of first day of employment, including completing the immigration status declaration and signing and dating the Employee attestation

2. Employee completes the entire Form I-9, including the Preparer/Translator attestation and the document identification section

3. Employer pre-completes Section 1 for the Employee

4. Employer fails to examine original documents – remote hire or otherwise


Ten Most Serious I-9 Errors, cont’d

5. Employer reports accepting document (s) which establish that the Employee is ineligible for US employment and/or to work for the Employer

Foreign passport or birth certificate Expired DHS work authorization document Receipt for filing petition/application for US permanent

residence Receipt for DHS expired work authorization document I-94 card reflecting visitor, student or other non-authorized

work status DHS authorization to work for different employer (H-1B, J-

1)


Ten Most Serious I-9 Mistakes, cont’d

6. Employer fails to record required document identification and expiration information or otherwise copy and retain verification documentation

7. Employer over documents in Section 28. Employer fails to complete Section 2 attestation by

inserting start date of employment and/or signing and dating completion date.

9. Employer fails to update verification information prior to the expiration of temporary work authorization document

10. Employer fails to audit I-9 files


I-9 Myths

• Completing I-9 forms provides an absolute defense to civil and criminal liability

• Employers should not ask questions about the validity of questionable documents; they should follow a “don’t ask, don’t tell” policy

• Employers who insist on presentation of a valid social security card may be sued for document abuse or discrimination

• Employers can never insist that an employee complete a new I-9 form if the employee has already completed one

• It is a mistake to copy documents• Employers can’t terminate employees for providing fake

documents and fake identities in the I-9 process


Increased Civil Money Penalties Effective March 27, 2008

• Knowing hire 1st offense 2nd offense 3rd offense

• Paperwork violations

• Document fraud 1st offense 2nd offense 3rd offense

• Failure to notify DHS of action on final NC if enrolled in E-Verify

• $375-$3200@UA• $3200-$6500@UA • $4,300-$16000@UA

• $110-$1100@I-9

• $375-$3,200@document• $3,200-$6,500@document • $4,300-$16,000@document

• $550-$1,100@violation


Update on E-Verify

• 92,000+ employers signed up and growing

• Authorized through March 1, 2009

• FAR E-Verify Final Rule – issued October 28, 2008, effective on contracts issued on and after January 15, 2009 (pushed back to May 21, 2009)

• State E-Verify requirements for employers and contractors


FAR EVERIFY FINAL RULE

Employer Coverage• Prime contractors on federal

commercial and non-commercial services and construction contracts over $100K and 120 days

• Subcontractors – provided subcontract for construction or services exceeds $3K


FAR EV NPRM

Employee Coverage• All incumbents hired after 8/6/86 who

perform direct services under a covered federal contract + all new hires

• Excludes employees who normally work in support positions and who do not perform any substantial work under a covered federal contracts

• All new hires of contractor not directly assigned to federal contract employed in U.S.


FAR Reg – Mandatory E-Verify • Within 30 days of award – must enroll and train all authorized personnel to input

EV data, monitor DHS responses in system, and respond to DHS directives• Within 90 days following first enrollment or date of contract award if

previously enrolled – must initiate E-Verify process for all existing employees directly engaged in covered federal contract. Pull I-9s of all incumbents If I-9s reveal expired documents (including expired USC passports), or

if expiration date cannot be ascertained, or no picture ID, or no social security account number provided in Part I

Meet with incumbents to complete new I-9 Picture IDs and SSANs required for EV

Initiate EV process• After the initial 90 days, contractors must initiate EV process

within 3 business days of hire or assignment to contract• All new hires of covered contractor/subcontractors

Complete I-9 process on first day and process through EV system


Great Unknown

• Whether the Obama Administration will retain FAR E-Verify rule as is or in modified form

• Litigation on hold for 90 days• Implementation delayed until May 23, 2009• Vote to extend E-Verify due in early March 2009• Note – House and Senate Conferees deleted the E-

Verify mandate for contractors using Stimulus Funds – query if this is an indication the Obama Administration will withdraw Bush EO


SSA/DHS No Match Letters – Constructive Knowledge and The Safe Harbor Rule

• What is a No-Match Letter?

• Why does DHS contend failing to investigate can be used as evidence of constructive knowledge of unauthorized status?

• Will Letters be going out in 2009?

• Are employers free to ignore Letters sent to individual employees?

• How does an employer qualify for the DHS Safe Harbor?

• What are the risks of implementing or exceeding DHS Safe Harbor requirements?


No-Match Rule Litigation

• PI entered 10/18/07 enjoining implementation of 8/15/07 Final Rule -

• Failure to adequately explain perceived change in policy re significance of No Match letters

• Ultra vires as to claim of immunity from discrimination claims

• Failure to comply with the RFA• 3/21/08 – DHS issues Supplemental Rule• 10/23/08 – DHS Issues Final Supplemental Rule,

followed by Motion to Vacate PI and Motion for SJ• Plaintiffs filed for SJ – 1/9/09• 4/10/09 – Opposition briefs due


Ignorance Is Not Bliss

• DHS views No Match data as key evidence of employer complicity in illegal hiring scheme

• DHS remains free to prosecute employers based on actual and/or constructive knowledge of unauthorized status – IFCO, Swift, Koch – painful examples

• DHS may obtain information regarding past No Match Letters from SSA if criminal investigation is opened through ex parte procedure or may seize such documents pursuant to criminal search and seizure warrant

• DHS could continue raids and stings in pursuit of evidence of immigration crimes

• Superceding Indictment against 5 IFCO Managers – including VP of HR, and HR Mgr – charging conspiracy to defraud US based on use of false SSA numbers, failure to investigate No Match Letters, deliberate underpayment of payroll taxes by encouraging holder of bad documents to claim excess dependents


Immigration Crimes and Prosecutions

• Felony Hire

• Felony Harboring

• Aiding and Abetting

• Conspiracy

• Money Laundering


Felony Hiring Violation8 USC §1324(a)(3)

• Elements Actual knowledge that foreign workers were

smuggled into the U.S. in violation of law Actual knowledge of illegal immigration status at the

time of hire At least 10 individuals in 12-month period

• Maximum imprisonment – 5 years

• Maximum Fines – greater of $250,000 or 2x financial gain


What Constitutes “Actual Knowledge”

• Employee confession: “I’m illegal” “I don’t have papers” “My papers are no

good” “These are not my

papers”• Government proof:

Admissions made on wire

Witness testimony


Felony Harboring Violation8 USC §1324(a)(1)(A)(iii)

• Required Elements Knowledge – Actual or constructive (reckless disregard

standard ) that a person has come to, entered, or remains in the U.S. in violation of law

Conduct – Harboring, concealing, or shielding from detection said person – thereby “substantially facilitating” the alien remaining in the U.S. illegally

Intent – To evade or avoid detection by law enforcement

• Maximum Imprisonment – 5 yr./10 yr. (commercial advantage/financial gain)

• Maximum Fine – greater of $250,000 or 2x financial gain


What May Constitute Evidence of “Constructive Knowledge” (Reckless Disregard)

• Knowledge of expired DHS Employment Authorization Document (Failure to Update I-9)

• Failure to act reasonably in response to DHS notice of Suspect Documents/Unauthorized Status

• SNNVS “No Match” Response – No reasonable response• Failure to act reasonably in response to SSA No Match

Letter • Rehiring workers using new documents and new identities• Inspection of a foreign passport, foreign birth document,

visa application or labor certification application during I-9 process


Evidence Found Sufficient to Sustain Harboring Charge

• Providing housing or transportation to unauthorized workers• Paying unauthorized workers through a third party or

subcontractor, or paying a contractor while knowing or recklessly disregarding that the contractor and/or his workers are undocumented

• Cashing checks made payable to 1099 subcontractors• Tipping off employees of ICE presence• Failing to investigate No Match letters (beware individual

letters and SSNVS no matches garnered by payroll software)• Accepting documents known to be fraudulent for I-9

purposes• Assisting employees in obtaining fraudulent documents


Felony Money Laundering18 U.S.C. § § 1956/1957

• Requires proof of a financial transaction conducted in the proceeds of “specified unlawful activity”

• 18 USC §1956(c)(7) predicate crimes include harboring, attempting to harbor, aiding and abetting harboring and conspiracy to harbor

• Maximum Imprisonment – 10–20 years @ violation (depending on added circumstances)

• Maximum Fines - $250,000 or 2x gain (§1956); greater of $500,000 or 2x amount laundered (§1957).


Criminal Asset Forfeiture18 U.S.C. §982(a)(6)(a)

• Requires felony conviction• Separate count to be considered by the jury• Allows Government to claim all assets used in

commission of the crime as well as the proceeds of the crime

• Major bargaining chip in plea negotiations


Major ICE Enforcement Actions, 2007-2008

• Koch Foods • Swift & Company• George’s Processing, Inc. • Cargill/Quality Service Integrity, Inc.• Fresh Del Monte Produce• Pilgrim’s Pride• Agriprocessors• Howard Industries


Factors Suggesting Increased Risk of Ice Enforcement

• Complaints from local citizens and elected officials • Arrest and interrogation of unauthorized workers• Recent I-9 audit and Notice of Suspect Documents• Unresolved Social Security No-Match Letters• Prior INS/ICE NOIF or Warning Letter• Housing and transportation assistance• Identity fraud complaints• Union tips - employee abuse, underpayment of wages• Proximity to DHS staging facilities and task force units• Facilities in immigration backlash and/or 287(g) jurisdictions


Rule 41 Search Warrant – Lessons Learned

• Government Agents are not your friends – whatever you say can be used against you – no need for Miranda warnings prior to arrest

• Use of wired confidential informants and sophisticated surveillance equipment are common – be suspicious of any individual who invites you to commit an immigration violation

• Reliance on terminated managers for labor violations and immigration conspiracy evidence common – immigration compliance policy and enforcement is best defense


Report Immediately

• Any government agent visits to the worksite – regardless of reason given

• Any reporter visit to worksite inquiring about wages, working conditions, union activity or immigration issues

• Any employee or subcontractor request that you to do something illegal or shady, particularly relating to violating immigration, tax or employment laws


Report Immediately

• Any threat to “get” the employer for immigration violations (from competitor, former employee/supervisor/spouse, area/community resident)

• Nearby ICE raid on another builder


What To Do If Raided

• Ask to see agent identification• In non-public area, insist on search warrant• Read the search warrant to ensure execution by a

federal magistrate and determine the scope of authorized search

• Do not argue with the agents – will be grounds for obstruction charge

• Do not answer questions about the subject of the search.

• Inform agents you are not authorized to discuss HP business with third parties. Provide name and phone number of responsible HP representative.

Immigration Worksite Enforcement Update: Federal Contractor Verification Rules, No Match Letters, I-9

Audits, Criminal Enforcement, and State Employer Sanctions Laws

Thank you for your participation.

Mary E. Pivec, Esq.Keller and Heckman LLP

1001 G Street N.W., Suite 500WWashington, D.C. 20001

[email protected]

Progressive Business Conference. New I 9 Rules

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