More than you may expect.
The Trump administration has made a high priority of enforcing immigration law. As a result, worksite enforcement actions, including I-9 inspections, are increasing. Then Acting Director of ICE, Thomas Homan, announced in October of 2017 that his desire was to increase the time spent by ICE on worksite enforcement by four to five times previous levels. Homan retired the last week of June 2018, but the increase in worksite enforcement will most likely continue to be a priority for this administration.
Employers need to be prepared for an increased chance of being involved in an I-9 inspection. These inspections may include much more than just I-9 forms. ICE may also inspect your payroll records, current employee roster, past employee records, tax statements, earnings statements, Social Security Administration correspondence, business licenses, articles of incorporation, annual revenue data, a list of federal contracts and a list of subcontractors or any temporary employment firms used by the company.
To learn more about recent trends in I-9 compliance, listen to this on-demand webcast, What’s new in HR Compliance: I-9 through Unemployment Claims.
The fines for I-9 violations by employers have increased four times since 2016. As of January 29, 2018, a DOJ penalty for a knowing hire/continuing to employ violation for a first offender has increased to a range of $559 to $4,473 per offense. For a third offense, the range of fines is now $6,709 to $22,363 per offense.1
These fines can really add up for employers. For example, an employer with 1000 employees may have an average 3-year retention rate of 3,000 I-9 forms. If the error rate in their paper I-9 system is 70%, their potential penalty at an average fine of $1,230 could total $2,583,000.
Phases in the I-9 Inspection Process
There are three phases in the ICE I-9 inspection process:
- Notification and preparation
- Forms inspection
- Contest period
In Phase 1, a Notification of Inspection (NOI) may be hand delivered or sent by certified US mail. ICE usually gives companies only three days to collect and organize the I-9 forms and submit them. However, ICE also has to power to seize the forms immediately through subpoenas and warrants.
Some states may require that employers notify employees of the receipt of a NOI from ICE. Companies need to be aware of the laws regarding employee notification in all of the jurisdictions in which they operate, and have systems in place to quickly communicate with all affected employees in order to comply with the applicable laws.
During Phase 2, ICE will inspect I-9 forms and other documents included in the NOI. Failures to comply will be classified into two categories; substantive violations that impede the ability of the employer to verify, and technical or procedural violations, which may be corrected within 10 days by the employer to avoid penalties. Substantive violations may not be corrected.
Inspection results may include:
- Notice of Inspection Results – indicating that the employer meets compliance requirements
- Notice of Suspect Documents – employees with suspect documents are ineligible to work in the U.S. and should be terminated
- Notice of Discrepancies – indicates ICE cannot verify an employee’s employment eligibility and gives the employer the option to submit additional documentation
- Notice of Technical of Procedural Failures – details violations and provides 10 days to remedy them
- Warning Notice – notifies the employer that substantial violations exist but that will not be accompanied by a monetary fine
- Notice of Intent to Fine – identifies violations that require a financial penalty
In Phase 3, the Contest Period, employers may choose to negotiate a settlement, or request a hearing within 30 days. If the employer does not follow one of these two paths, ICE will issue a Final Order for the company to pay the fines.
Preparing for I-9 Inspections
Due to the increased risk of being involved in an I-9 inspection, employers would be well advised to get their houses in order now. ICE has ruled favorably by reducing or even eliminating fines for employers who have taken steps to correct their issues before being inspected.
A good way to prepare for an ICE I-9 inspection is to perform an internal I-9 form audit by gathering all I-9 forms (paper and electronic) within three days. Missing forms should be identified and added. Issues with existing forms should be identified and corrected.
I-9 forms that are no longer required to be retained should be destroyed or deleted. During an I-9 inspection, ICE may issue penalties even for forms that no longer need to be retained, so purging them from your system now reduces your risk.
Systems should be put in place to automate the onboarding process and completion, retention and destruction of I-9 forms.
Standardizing your I-9 completion process will reduce errors. A Standard Operating Procedure Manual should be developed, and recurring training should be required for staff members involved in the onboarding process.
For employers with operations in multiple locations, a centralized HR document management system improves compliance.
Automate Your Compliance
Using an automated system for onboarding and HR document management will improve compliance, reduce risk and increase efficiency. I-9 form completion can be easily done online in remote locations on many types of devices, even for employees who do not have their own computers. An estimated 60% to 80% of paper I-9 forms are missing.2
An automated self-audit and remediation solution makes it easy to review your entire I-9 archive and provides an extensive audit trail that may reduce any fines and penalties from ICE. An automated I-9 system enables employers to respond to ICE NOIs within the mandatory 3-day time frame, and find forms that may have issues so corrective actions may be taken before ICE inspects them.
CartaHR employee document management software is built for HR. Integrated with Equifax solutions, CartaHR provides ongoing compliance throughout the employee lifecycle. For more information, please visit our website.
1 “Civil Monetary Penalties Inflation Adjustment,” 83 Federal Register 19 (29 January 2018), pp. 3944-3948
2 According to an industry attorney at Jackson Lewis P.C.
Andrea Palumbo has over 20 years of experience in the HR and Payroll industry as both an HRIS client and vendor. Her teams are responsible for implementing and maintaining critical HR technology, data and timely processing of payroll for over 1300 employees globally. Andrea’s in-depth knowledge of HR Technology and sensitive employee data allow her to convey the benefits of having a robust HRIS and data management systems working together side by side.