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Employer Sanctions: A New ICE Age?

ICE – refreshing to cool a drink on a hot summer day, but ICE may cause shivers for employers. 

What Is ICE?

ICE is the acronym for U.S. Immigration and Customs Enforcement, the enforcement component of the U.S. Department of Homeland Security. Since April 2006, when ICE announced a comprehensive immigration enforcement strategy for our nation’s interior, ICE activities have resulted in many news accounts of ICE raids, arrests and federal indictments of employers, supervisors and employees. While many of these enforcement activities involved serious, sometimes criminal allegations, they represent a significant re-focus of enforcement priorities to unauthorized employment. 


ICE Enforcement Strategy

The April 2006 strategy for immigration enforcement focuses on three primary goals: to identify and remove criminal aliens and immigration fugitives and violators from the United States; to strengthen worksite enforcement and compliance programs to deter illegal employment in the US; and to uproot the criminal infrastructure that supports illegal immigration, such as human smuggling/tracking and document/benefit fraud. 

For the second goal of building strong worksite enforcement to deter illegal employment, ICE seeks to punish knowing and reckless employers of illegal aliens. In recent fiscal years ICE increased its criminal convictions from 46 to 127 for such violations, changing its approach to seizing illegally derived assets rather than merely relying on administrative fines as sanctions. For fiscal year 2007, ICE enforcement activities will receive a budget of $41.7 million in new funds and 171 agents to enhance workplace safety. The workplace enforcement agenda includes eliminating social security abuses and working with Congress to build employer compliance systems.


Proposed Regulations for No-Match Letters

Consistent with its strategy, ICE issued proposed regulations in June 2006 detailing an employer’s obligations in response to ‘no-match’ letters from the Social Security Administration (SSA). No-match letters are sent when a sufficient number of social security numbers reported by an employer do not match SSA records. The letters remind employers of the importance of providing correct social security numbers and encourage them to correct their records. The no-match letters importantly advise employers that they should not use the no-match to take adverse action against the employee and doing so may in fact violate state and federal law. Other guidance has suggested that employers are obligated to follow up with the employee to correct the information or face potential liability under tax and immigration laws. 


Safe Harbor from Constructive Knowledge of Unauthorized Employment

Significantly, ICE proposed regulations include a no-match letter as evidence to show an employer’s constructive knowledge of unauthorized employment. The proposed regulations detail an employer’s obligations in response to a no-match letter and set out a ‘safe harbor’ to permit employees to avoid immigration law liability upon receipt of a no-match letter. To obtain the benefit of the safe harbor, the regulations require the following:

1. Within 14 days of receipt of the no-match letter, the employer must check its own records to determine if the error resulted from its own clerical error and, if so, verify the correction with SSA. If this does not resolve the error, the employer must confirm its record with the employee and verify any correction. 
2. If the social security number is not verified in step one within 60 days of the receipt of the no-match letter, the employer must ask the employee to go to the SSA office to resolve the matter in person and verify with SSA that the employee’s name matches SSA records for that name. 
3. If the discrepancy is not resolved by the first two steps, the employer must verify the identity and work authorization for the employee by completing a new Form I-9 within an additional three days without using any document containing the social security number which is the subject of the no-match letter. For this verification, the employer may not use a receipt for an application for replacement of the social security number or a document without a photograph to establish identity. 

If after following these procedures the discrepancy in the social security number remains, the employer must either (a) terminate the employee; or (b) risk a finding by the agency that the employer has constructive knowledge that the employee was unauthorized, and by continuing to employ the individual, has violated the immigration law. If the employer follows the safe harbor guidelines, the employer will not be considered to have constructive knowledge from a no-match letter even if the employee is unauthorized to work in the US. 

The regulations also provide generally the same safe harbor procedure for written notice from the Department of Homeland Security that an immigration status document or employment authorization document was assigned to another person. 

The proposed regulations were open to public comment through August 14, 2006. Specifically ICE requested comments on whether the 60-day limit should be a 30-day or 90-day limit, and also for alternatives. Combined with increased ICE enforcement efforts, and the national debate concerning comprehensive immigration reform, the majority of comments are expected to be negative from the employer community. 


What Should Employers Do Now? 

Prudent employees should assume that ICE will operate under the proposed regulations. Employers should take steps to ensure immediate compliance with all Form I-9 work authorization requirements. Also, employers should establish a policy about how they will respond to no-match letters. Employers can now prepare for potential additional ICE attention and should conduct an internal self-audit of its I-9 process. If employers do not feel comfortable with the numerous requirements of the process, they should consider bringing in legal counsel for assistance. Among the issues to consider are the following:

• The I-9 procedures should be centralized with employees trained in the process to ensure better compliance
• The I-9 should be completed within three days of hire
• Complete the I-9 fully and examine original documents 
• Only note the minimum required documents on the I-9 form
• The I-9 should be stored separately from personnel files and kept for the required time periods
• Consider copying the documents presented. Copies are not required and experts differ on whether or not to keep copies. Be consistent in the approach taken. 
• Properly re-verify expiring work authorizations. Do not ask for reverification of permanent residence cards
• If changes need to be made on I-9 forms, do not back date the forms but annotate changes

Care should be taken to eliminate any errors in the I-9 procedure and avoid even minor errors which may be used to support a finding of constructive knowledge of unauthorized employment. A good I-9 policy with properly completed forms will show an employer’s good faith efforts to comply with immigration requirements and may help mitigate penalties if violations are found.


To Avoid Slipping On ICE

Employers should take care now to ensure compliance with the I-9 employment verification requirements and to develop procedures for response to SSA no-match letters. If you require any assistance in developing such a verification procedure, in conducting an internal audit of I-9 procedures, in responding to SSA no-match letters, or concerning other employment or employment-related immigration issues, please contact Phil Ripani at (317) 684-5280 or email at pripani@boselaw.com, or Sandra Perry at (317) 684-5175 or email at sperry@boselaw.com in the Labor and Employment Law Group at Bose McKinney & Evans LLP.