Making Sure    Your Bases Are Covered

Several years ago, the worst-case scenario for businesses that hired illegal workers was often a slap on the wrist and a relatively small fine. These days, however, having illegal workers on the payroll could result in an employer’s arrest and hundreds of thousands of dollars in seized assets.

Old and New Approaches     A case study issued recently by the ICE highlights a dramatic shift in policy.     In March of 2006, ICE executed search, arrest and seizure warrants at three Japanese restaurants in Baltimore and four related residences where fifteen undocumented workers were found to be living. Three business owners were arrested for money laundering and harboring illegal aliens.     ICE seized assets including eight luxury vehicles, ten bank accounts and three safety deposit boxes and cash found during the residence and business searches.     The owners have since pleaded guilty to the felony charges and agreed to forfeit approximately $1.1 million in assets.     How would this case have been handled differently in the past?     Historically, federal agents would have likely conducted an I-9 inspection at the restaurants. Afterwards, they would have issued a fine based on paperwork violations, according to the ICE.     The owners would probably have escaped even a misdemeanor charge and the maximum fine would have been approximately $20,000. In many cases, fines could be negotiated down even further.     With such a result, the ICE stated, "it is not surprising that the old employer sanction regime had become simply a cost of doing business."

This is due to a crackdown by the Immigration and Customs Enforcement agency (ICE), which assumed authority over these matters from the U.S. Immigration and Naturalization Service (INS) in 2003. While INS agents generally issued warnings and imposed fines, the ICE has taken a much more aggressive stance of pursuing criminal prosecution of employers.

This change in policy has been largely influenced by the Department of Homeland Security, which has been under tremendous pressure to tighten border control. Hundreds of employer arrests have taken place thus far, a trend that shows no signs of abating. This groundswell has spread to other branches of the legislative and judicial system as well, including new strict state statutes and competitor litigation.

States Are Getting in on the Act. In addition to ICE actions, many states have passed legislation recently to penalize companies with illegal workers on the payroll. The laws cover a wide range of penalties such as hefty fines and prohibitions against businesses with undocumented workers being awarded state contracts.

Some businesses have also begun to sue other businesses on the grounds that they achieve an unfair advantage through the practice of hiring illegal workers. While these lawsuits are taking place in California under that state’s unfair-competition laws, other states are considering similar measures that could open up more lawsuits.

Be Safe, Rather Than Sorry.  With more than ten million estimated illegal immigrants in the United States, employers are in a potentially vulnerable position when it comes to hiring employees. Here are some steps that can help protect your organization when it comes to examining job applicants:

By law, employers must complete an I-9 Employment Eligibility Verification form for each new hire and keep the forms on file. Photocopy the documents provided by each employee. Maintain the copies with the I-9. Former employees' forms must be kept for three years from the hiring date or one year after termination, whichever is later. If an outside firm provides your organization with contractors, however, these responsibilities may be shifted to them.

The scrutiny with which you examine I-9 documents can be subject to litigation. The hiring process should objectively and appropriately judge documents and there should be transparency when it comes to your hiring practices and your continuing to monitor any employee’s citizenship status.

Know which documents you can ask for. The table at the bottom of this article lists the acceptable documents.

Let employees choose. Don't ask for particular documents or more documents than are required. Employees or applicants can choose the proof they want to offer and companies have faced lawsuits for specifying certain documents over others.

Accept documents that appear genuine although you aren’t responsible for confirming their authenticity. It isn’t wise to conclude that documents are false and routinely investigate authenticity without proper cause. ICE authorities don't expect employers to be immigration experts, but you should have sufficient knowledge to understand if a document is consistent with an employee's claimed status.

Avoid restrictive hiring practices. For qualified applicants, don't question the expiration date of work authorization or ask for documentation to confirm the date. You are able, however, to require new hires or employees to periodically show proof of continuing eligibility.

Establish procedures for responding to "no-match" letters received from the Social Security Administration. These letters inform employers when a number submitted on an I-9 does not match the name for that number on the Social Security database.

Don't jump the gun. While it is wise to conduct the I-9 verification process before a new hire starts work, don't initiate it before a job offer is made and accepted. Not hiring someone after seeing documents that reveal citizenship status, age, and national origin could be grounds for a discrimination claim.

Time Table for Completing the Process

Employers must complete the I-9 verification process within three business days of an employee's first day on the job. The only exception to this rule is when new employees lack a required piece of documentation, such as a Social Security card for example, and show a receipt to prove they have applied for one. In such a case, all documents must be presented and the I-9 form completed within 90 days of the first day of work. If the documentation is not produced, the person cannot legally continue to work and the employer has the right to suspend the employee without pay until the documents are obtained.

While these requirements may seem stringent, complying with them can, in the long run, save you potential financial penalties and legal trouble. If you need more information, consult with your attorney or human resources adviser.