Kelli Gavin Attorney & Counselor – Richard A. Gump Jr. P.C
FALL 2018 ISSUE: SMALL BUSINESS MATTERS If you own or operate a business in the United States, immigration laws impact you. All employers must check to make sure an employee can work in the U.S. The agencies that create the Form I-9 are all under the umbrella of the Department of Homeland Security (“DHS”) and will both audit and fine a business if it is not completed correctly.1 If you employ someone who is not a citizen, or plan to do so in the future, immigration laws also affect you. The non-citizen may be here temporarily, and must be sponsored to work for your company, or she may be allowed to work because of a certain protected status. As the owner of a business, you must constantly check to make sure you are not breaking any immigration laws. The penalties can be very serious, expensive, and can even hurt your business in the future. Business owners will need to keep their eyes and ears open to keep up with any new immigration laws and requirements that may be headed their way in the coming months and years.
Worksite and Form I-9 Compliance and Fines The Immigration Reform and Control Act of 1986 (“IRCA”) requires employers to complete Form I-9 Employment Eligibility Verification for each new hire.2 Forms must be completed within a certain time period and can either be done by hand or electronically.3 High fines and other penalties may result if the forms contain mistakes, or if business owners discriminate against either U.S. citizens or foreign nationals in their hiring practices.
Form I-9 Form I-9 is created and edited by the United States Citizenship and Immigration Services (“USCIS”), an agency within DHS that processes all applications for immigration benefits within the United States. New hires must provide personal information and documents that confirm their identity and prove they can work in the United States. An employer cannot tell an employee which identity and work authorization documents to present.4 It is not required, but is highly recommended, that an employer keep copies of the documents the employee gives. An employee must complete and sign Section 1 of the Form I-9 no later than his first day of employment, while an employer must complete and sign Section 2 no later than three business days after an employee’s date of hire.5 Either section can be completed before the first day of employment so long as a job offer has been made.6 The form is updated regularly, so it is important that employers or human resources professionals check to make sure the correct version is used. All forms for current employees must be stored and made readily available to an Immigration and Customs Enforcement (“ICE”) officer in the event of an audit.7
E-Verify E-Verify is an online system that business owners can use to confirm a new hire’s employment eligibility.8 The system is free, easy to learn and use, and provides the employer with an instant answer to the question “Is this person allowed to work in the U.S.?”9 After entering the employee’s information, either a red, yellow, or green case result will pop up, along with any additional instructions that may be needed.10 Some federal and state laws require an employer to use E-Verify.11Business owners who have had issues with employees providing fraudulent documents in the past may benefit from E-Verify. On the other hand, by enrolling in E-Verify, an employer is sharing information about how and when the Form I-9 was completed. USCIS may use this data to find patterns of mistakes or discrimination and it could lead to investigations and fines.
Audits and Fines If ICE decides to audit a business, the Form I-9s for all current employees must be handed over.12 If mistakes are made on the form, if forms are not completed on time, or if forms are not done at all, an employer can be heavily fined. To prevent these fines, business owners should review their records to make sure things are in order. Immigration attorneys offer internal audit services and trainings if employers are interested in creating or tightening up compliance processes.
During the audit, ICE is also checking to see if any persons working for the company are not allowed to work in the U.S. If it is found that someone is not legally authorized to work in the U.S., an employer can be fined for continuing to employ that person.13 The charts below show the potential fines for I-9 mistakes and knowingly hiring, or continuing to employ, workers without the ability to work. The fine percentage is typically calculated by dividing the number of violations uncovered by the auditor by the total number of employees.14
Discrimination and Other Potential Problems Employers cannot discriminate against U.S. citizens, legal permanent residents, or other foreign nationals who can work in the United States. The anti-discrimination provision of the Immigration and Nationality Act (“INA”), prohibits business owners from 1) citizenship status discrimination in hiring or firing; 2) national origin discrimination in hiring or firing; 3) unfair documentary practices during the employment eligibility verification, Form I-9, and E-Verify; and 4) retaliation or intimidation.15 The Immigrant and Employee Rights Section of the Department of Justice investigates discrimination claims and high monetary fines are collected from business owners who break the rules.16
Other agencies may also alert a business owner that an employee cannot legally work. The Social Security Administration (“SSA”) and Internal Revenue Service (“IRS”) may send a letter to an employer stating that the name for a certain worker does not match the social security records. This may happen due to payroll reporting or even when complying with the Affordable Care Act (“ACA”) healthcare reporting requirement. Certain steps must be taken to address any mistakes with the employee before it is assumed that he or she does not have authorization to work. These letters are not cause to fire an individual, but business owners should take them seriously and seek advice from an attorney if they are unsure how to proceed.
Immigration Crystal Ball It is difficult to predict exactly how immigration-related rules may change in the future, but several ideas have been introduced lately that may impact business owners. Programs like Deferred Action for Childhood Arrivals (“DACA”) and Temporary Protected Status (“TPS”) for certain countries are set to end in the future. These programs provide nearly one million people the ability to work. Employers will need to determine if any of their workers will be impacted, and how that might affect their ability to maintain current business practices and levels of work.
We have already seen a shift toward more audits, stricter interpretation of immigration laws, audits leading to higher fines for businesses that employ illegal workers, and raids across the country targeting criminal aliens. Other ideas that have been talked about by President Donald Trump and members of Congress include using a merit-based immigration system where a foreign national would need to meet a certain number of points to get a visa.17 Points would be given depending on education, age, skills, and other factors. We currently have a sponsorship-based system that looks at family ties or whether an employer is willing to pay a certain wage for a job for which no U.S. worker meets the requirements.
We could also see higher wages being required to employ foreign nationals as President Trump tries to protect American workers.18 Studies have shown, however, that the employment of foreign nationals increases wages for U.S. workers in most industries.19 Recent bill proposals and discussions have entertained the idea of putting individuals with DACA on a path towards citizenship.20 A future law of this kind could have a huge impact on business owners. Most Americans are in favor of granting green cards or citizenship to these types of individuals, but it would take Congress passing its first substantial immigration law since 1996 to enact this change.
Business owners will need to confirm they are following all immigration-related laws, both now and in the future, as changes could start coming more quickly. It is better to take the time to put processes in place and make sure things are working correctly before ICE comes knocking, than to pay to fix any problems afterward. Immigration rules impact employers each and every day but they can help you build towards a more profitable future if navigated correctly. Sources 1 See Internal Revenue Service, https://www.ice.gov/factsheets/i9-inspection (last visited September 29, 2018). 2 Immigration Reform and Control Act of 1986, Pub. L. No. 99-603, 100 Stat. 3445. 3 See Instructions for Form I-9, version 07/17/17,https://secure.i9.talx.com/Popups/Documents/I-9InstructionsNew.pdf 4 U.S. Citizenship and Immigration Services, I-9, Employment Eligibility Verification, https://www.uscis.gov/i-9 5 Id. 6 Id. 7 U.S. Citizenship and Immigration Services, I-9 Central, Inspections, https://www.uscis.gov/i-9-central/retain-store-form-i-9/inspection/inspe... 8 See E-Verify, https://www.uscis.gov/e-verify 9 Id. 10 Id. 11 See E-Verify, Supplemental Guide for Federal Contractors, 5.1 The Federal Acquisition Regulation (FAR) E-Verify Clause in a Federal Contract, https://www.uscis.gov/e-verify/publications/manuals-and-guides/51-federa...Melissa A. Silver, XpertHR.com, E-Verify Laws by State, https://www.shrm.org/resourcesandtools/legal-and-compliance/state-and-lo... (last visited Mar. 8, 2018). 12 U.S. Citizenship and Immigration Services, I-9 Central, Inspections, https://www.uscis.gov/i-9-central/retain-store-form-i-9/inspection/inspe... 13 See U.S. Immigration and Customs Enforcement, Form I-9 Inspection Overview, https://www.ice.gov/factsheets/i9-inspection 14 Id. 15 See 8 U.S.C. § 1324b. 16 See The United States Department of Justice, Immigrant and Employee Rights Section, https://www.justice.gov/crt/immigrant-and-employee-rights-section for recent case and settlement examples. 17 See Lisa Segarr and David Johnson, Find Out If President Trump Would Let You Immigrate to America. TIME (2017), http://time.com/4887574/trump-raise-act-immigration/ (last visited Mar. 8, 2018); Youyou Zhou, Trump’s merit-based immigration proposal would dock points for spouses, QUARTZ, https://qz.com/1195155/trumps-merit-based-immigration-proposal-would-doc...(last visited Mar. 8, 2018). 18 See Exec. Order No. 13,788, 82 Fed. Reg. 18837 (Apr. 21, 2017). 19 See Jacqueline Varas, How Immigration Helps U.S. Workers And The Economy, American Action Forum, https://www.americanactionforum.org/insight/immigration-helps-u-s-worker...Gianmarco I.P. Ottaviano & Giovanni Peri, Rethinking the Effects of Immigration on Wages, (Nat’l Bureau of Econ. Research Paper No. 12497, 2008). 20 See Kopan, Tal. Exclusive: Bipartisan House group unveils new DACA proposal, https://www.cnn.com/2018/01/29/politics/daca-bipartisan-deal-problem-sol..., (last visited on Mar. 8, 2018).