The employment world is now reeling from a sudden new wave of government regulations and workplace enforcement efforts. Despite the failure of Congress to pass comprehensive immigration reform, new polices from US Immigration and Customs Enforcement (ICE) and bold new precedents in state legislation have changed the hiring landscape almost over-night. An unprecedented increase in arrests of top-level executives and new policies on employment verification are all a part of this immigration "climate shift."



Summary of key developments:

DHS has issued a new I-9 form and updated instructions for completion. As of November 7th 2007, this form replaces all previous versions, and is the only form that can be used after December 26th 2007. Five documents have been removed from the list of documents employers can accept to establish identity and employment eligibility, and one new document was added.

ICE has launched a new campaign of workplace raids resulting in increased penalties and jail time for employers. In 2007, ICE made 863 criminal arrests and 4,077 administrative arrests in the workplace alone.

DHS has increased civil penalties for workplace violations an average of 25%. Effective March 27th fines for non-compliance start at $375 per infraction. If convicted of knowingly or intentionally hiring undocumented aliens, employers on their first offence can be fined up to $3,200 dollars per illegal worker. For repeated violations, as much as $16,000 per incident can be assessed.

State legislatures are now passing laws requiring employers to use the federal E-verify program to electronically confirm new employees' work eligibility. While the federal government encourages the use of E-verify, it has not made the program mandatory due to inadequacies in the database.

In February, despite known deficiencies and challenges to its constitutionality, an Arizona district court upheld the States right to pass its own comprehensive immigration reform act. With this new precedent, It has been predicted that as many as half of all U.S. States will follow suit.

E-verify: Proceed with Caution

With so many new developments, what must employers do to comply with or prepare for these changes? Many experts are advocating that employers nationwide, in the 40+ states that have not yet made it mandatory, voluntarily enroll in the E-verify program. However, before you sign up, read fine print.

In my former role as head of HR for a small services company, our legal counsel advised us not to enroll in the E-verify program. Having used the program in the past, I was happy to heed his advice. Though you may feel compelled to register for the program in good faith, as a precondition you must sign a Memorandum of Understanding (MOU) that basically grants the ICE access to your worksite and your records at any time.

By your willingness to comply, you essentially put yourself on the government's radar. This could in effect double the likelihood of any I-9 error or omission, being discovered by an ICE inspector; and consequently double the likelihood civil penalties being assessed.

Another problem with using E-verify is the inadequacy of its database itself. According to an evaluation commissioned by the US Citizenship and Immigration Services (USCIS) in September 2007, "the database used for verification is still not sufficiently up-to-date to meet the requirement for accurate verification, especially for naturalized citizens."

Having used this system myself, I can tell you that this system has, on several occasions, had an adverse impact on employees with legal work authorization, who were not able to start work due to incomplete data.

Small Business must be Proactive

In my opinion, the deficiencies in the E-verify system simply make it impractical for many employers, particularly small businesses, to use the E-verify system in its current form. Regardless, employers must bring their hiring practices into compliance and must be pro-active as new legislation emerges. Here are some helpful tips:

Perform a Self-Audit - Hire an employment law firm, or an HR consultant who is knowledgeable and up-to-date on all the current labor laws and changes, to perform a complete audit of all of your I-9 records. Audits should be performed at least once a year.

Note discrepancies and make corrections- During the audit, note any discrepancies and document them on a separate list. Some errors on I-9's can be corrected by crossing through them, and filling in the correct information. In cases with multiple errors, it is sometimes advisable to re-verify the employee's work authorization by completing a new I-9 form. Caution: If you do complete a new form for an active employee, do not discard the old one. Rather, attach it to the back of the new form.

Document all changes and corrective actions- The idea is to show an ICE inspector in "good faith" that you admit your recordkeeping has not been perfect in the past but you have taken steps to remedy this and are now being pro-active.

Train all staff involved in the I-9 process- I recommend limiting the number of individuals responsible for completing the I-9 process to as few as possible to lessen the likelihood of mistakes. Many of the errors I have encountered on audits were committed by field supervisors and other personnel who are unfamiliar with the process and its importance.

Re-train all staff on the proper completion, and retention of these forms. Make sure they are using the latest version, and understand the consequences of errors. Refer to DHS Form M-247 "Handbook for Employers" which is available on the DHS website.

Keep your I-9 forms separately from employee files- I recommend keeping your I-9's in two separate binders, one for "active" employees, the other for "inactive". Each binder should be kept in alphabetical order and up-to-date at all times.

In the front of the binders, include official announcements of procedural changes, lists corrections made as a result of your audit, and dates when staff were trained. It goes a long way to showing "good faith" compliance if your records are pristinely organized and readily accessible to an ICE Inspector.

An Electronic Alternative

In response to the outcry from employers to simplify the I-9 process, the DHS and SSA have designated a new service, called Form I-9 Compliance, LLC to electronically administer the I-9 employment verification process. The company offers a web-based service that lets employers complete I-9 forms online.

The system will automatically check for errors, allow employers to store I-9's electronically, and automatically notify as work authorization expires. Form I-9 Compliance also offers a seamless integration with the E-verify program for employers who choose to participate.

Though I have not used the services of Form I-9 Compliance, LLC myself, it seems to be a very practical solution to the administrative burden of the I-9 process. In its "Terms of Use," employer privacy is heavily emphasized, mitigating employer fears of undue attention from ICE.

DISCLAIMER: the information provided here is not a substitute for legal advice. Before implementing these or any other compliance strategies, always consult with an attorney who is familiar with your present business needs and you past experiences with Immigration issues.