Although Congress came close to passing an immigration reform bill this term, there has been no substantive change to the immigration laws. Yet, the Department of Homeland Security (DHS) and its Immigration and Customs Enforcement division (ICE) have increased enforcement of the existing law’s employment provisions. Thus, the former agency, the Immigration and Naturalization Service (INS), filed 25 complaints against employers for employing undocumented aliens in 2002, which was the INS’s last full year of existence. ICE filed 716 complaints in 2006. Some employers faced jail time for these criminal violations, including managers of employment services and the owner of a chain of donut shop franchises.

Employers’ Role in Enforcement of the Immigration Laws

Current law requires prohibits employers from “knowingly” employing anyone without proper employment eligibility verification. Employing workers without documentation is a crime. Employers must verify acceptable documents to complete an I-9 form, which confirms employment eligibility.

The Immigration Reform and Control Act of 1986 (“IRCA”) says that employers should not request more or different documents than those authorized. Specifically, employers may not demand social security documents or refuse to honor documents that reasonably appear to be genuine. At the same time, an employer is not responsible for analyzing every social security card or other employment authorization employees present. In fact, employers are prohibited from challenging facially valid documentation. That said, the courts have said that employers may not deliberately ignore suspicious information.

Employees frequently present a social security card and a government-issued photo ID, or a permanent residence card (popularly known as a “green card”) as documentation for the I-9 form. There are several other acceptable employment verification documents listed on the I-9. The government has indicated this list may be changed in the future to reduce the list of acceptable verification documents. Carefully following the I-9 documentation procedures protects employers from fines and criminal penalties, even if the documents are later discovered to be false.

The Social Security Administration monitor records and challenge submissions of social security numbers that do not “match” the agency’s records. DHS recently issued new regulations explaining employers’ obligations when they receive “no-match” letters from the SSA, or a “mismatch” letter from ICE. If employers follow the new regulations, they will be protected from DHS penalties for continuing to employ undocumented workers. On the other hand, employers that do not follow DHS’s new rules risk fines and possible jail time.

DHS Mismatch Letters

Employers must have I-9s on file for all current employees and former employees going back three years. I-9s need not be submitted to immigration officials unless requested. ICE can investigate any employer it for which there is a reasonable probability of a violation of the immigration law and must be given access to the employees’ I-9s.

If ICE discovers that the Alien Registration Numbers contained in the employer’s I-9s do not match immigration records, the agency will send a Notice of Suspect Documents, or “mismatch letter,” notifying the employer that it suspects the employees are not in fact authorized to work in the United States. Federal courts have held that an employer can violate the immigration law by ignoring a letter from the immigration officials and continuing to employ a person who is not in fact authorized to work.

SSA No-Match Letters

For tax withholding purposes, employers must obtain a social security number for every employee and submit it to the Internal Revenue Service (“IRS”) on a W-2 form. It is illegal to continue to employ someone if the employer becomes aware that the person is not authorized to work in the United States. If the immigration authorities review and determine that an employee’s documentation is not valid, the employer is then on notice that the employee may not be authorized to work and cannot depend on the good faith defense.

The IRS then compares the W-2’s to records on file at the Social Security Administration (“SSA.”) SSA needs to match earnings records to employee Social Security accounts to properly credit employees for benefits. If the information the SSA receives does not match their records, they cannot properly credit the account. They will then send a “no-match letter” and request corrected information. SSA has no tax or immigration enforcement responsibilities, but now includes a pamphlet from Homeland Security with its “no-match” letters as an example of intra-governmental cooperation. Employers may also verify social security numbers by calling 800-772-6270.

How to Respond to Mismatch/No-Match Letters

Many no-match or mismatch letters are simply the result of an innocent error, such as a typo in copying the social security number. Employees may be using a different last name because they have married or divorced and the records have not been updated. Legal immigrants who are not native speakers of English may write their surnames differently, which can result in the name be placed in the wrong box on a form, or their names may have changed due to the “Ellis Island effect” (that is, their names were too hard to spell in the immigration records and the family used the new name on the paperwork rather than argue the immigration officials); or the employee may not be practiced in spelling their name with the English alphabet. In some cases, a no-match letter can result from an error at SSA.

However, if a no-match letter from SSA or a mismatch letter from ICE is the result of an employee using a false social security number, DHS will consider it be official notification of a possible violation. Continuing to employ an individual after receiving official notice of an incorrect work authorization can result in criminal prosecution. Following the new DHS rules to correct no-match letters from SSA or mismatch letters from DHS will provide a “safe harbor” to protect the employer from prosecution, even if the employee later turns out to be undocumented.

The New Safe Harbor

The DHS regulations require the following steps be taken within 93 days from receiving the letter, or risk being found in violation of the IRCA:

• First, ensure the no-match letter was not the result of a clerical error in the employer’s office.
• Second, ask the employee to review his or her documentation to ensure that the employer has the correct information. If either of these steps corrects the error, then the employer should keep a record of its inquiry and the corrected documents. These steps should be completed and documented with 30 days.
• Third, if the employer cannot resolve the issue, and the employee continues to claim that he or she is authorized to work in the United States, the employer should ask the employee to contact SSA to resolve the issue. DHS provides an additional 60-day window to allow the employee and SSA to correct any error.
• Finally, if those steps do not resolve the issue within 90 days of receiving the no-match letter, the employer should request the employee to complete a new I-9, but the employee may not rely on the social security number already rejected by SSA.

Because a social security card is only one acceptable means of proving authorization to work in the United States, the employee can use another, such as a U.S. passport or a birth certificate, to complete the special “safe harbor” I-9 verification. After the 90 days to correct the social security number have expired, the employer has three days to re-verify the I-9, because new hires are allowed three days to complete their initial I-9s.

Of course, re-verifying the I-9 will not necessarily resolve the underlying problem – that the employee’s social security number is incorrect. The employee could still be a fugitive or a tax protestor who refused to provide a valid social security number, but at least the employer would be safe in believing the employee is not an undocumented alien. If the employee refuses to correct the social security number, the employer will likely receive a new no-match letter the next year when W-2s are filed. This would restart the requirement to attempt to correct the social security number or re-verify the I-9. DHS rules and best management practices require keeping clear documentation of the employer’s efforts to correct the no-match letter. Ultimately, employers who are unable to verify employees’ right to work through these procedures risk liability for violating the law by knowingly continuing to employ unauthorized persons.

This new rule is issued under DHS’s administrative authority, and does not represent any action by Congress. DHS says this rule is simply intended to clarify the employer’s access to the safe-harbor protection of the regulations under existing law. In addition, this rule deals only with what employers should do when they receive no-match letters from SSA or mismatch letters from DHS/ICE. Employers can still be liable for continuing to employ unauthorized individuals if they receive information from another source that their employees are not authorized. In fact, it is not unheard of for employees to admit that they are not authorized to work in the United States or that their documents are false. An employer will be liable if they knowingly continue to employ those individuals after such a disclosure.

Apply Immigration Laws Equally

It is critical for all employers to implement consistent and uniform policies for verifying immigration authorization for all employees, regardless of perceived national origin or race. If an applicant is authorized to work in the United States, employers are prohibited from discriminating on the basis of their immigration status or national origin under Title VII of the Civil Rights Act of 1964 and California’s Fair Employment and Housing Act. In California, an employee’s immigration status is irrelevant to whether an employee is protected by California employment and labor laws. The new DHS regulations say explicitly that “knowledge that an employee is unauthorized may not be inferred form an employee’s foreign appearance or accent” and require that employers treat all employees who receive mismatch/no-match letters equally.