Last year, the U.S. Department of Homeland Security conducted an unprecedented number of Form I-9 audits, investigations, and raids across the country. Immigration and Customs Enforcement made headlines nationally and locally with record breaking numbers of audits, arrests and multi-million-dollar fines assessed against U.S. employers.

Every U.S. employer can be subject to an ICE Form I-9 audit of its workers. Given the spike in ICE audits, it is imperative to ensure I-9 compliance at your organization.

Similarly, the U.S. Department of Labor has also been investigating injuries to U.S. workers caused by the employment of foreign nationals admitted under nonimmigrant visas. As the DOL ramps up its wage and hour audits, it is critical that employers sponsoring H-1B workers for employment have their Public Access Files in order and have an understanding of who may inspect those files.

The cost of non-compliance

Matthew T. Albence, Acting Director of ICE, said that a major part of the agency’s mission is to “remove the magnet of illegal employment by targeting egregious employer violations and abuses in both critical infrastructure protection (CIP) business sectors and non-CIP business sectors.” To that end, ICE received an additional $6.5 million to hire new officers and open new offices. ICE has opened and is in the process of staffing four new Homeland Security Investigation offices in Charlotte/Charleston, Kansas City, Las Vegas, and Nashville/Louisville, to continue their I-9 audit efforts in 2020.

More importantly, given that this is an election year in which immigration is a controversial topic, ICE and the DOL are committed to continuing their efforts to ensure employers are compliant. Employers need to be prepared to respond to the increased focus on worksite audits, investigations and the enforcement measures. Failure to follow the law can result in criminal and civil penalties. Large civil penalties can be assessed against employers for even simple mistakes occurring on the Form I-9, ranging from $220 to $2,126 per violation, per form. In addition, employers need to be aware that since 2017, ICE has been imposing some of the largest employer penalties in its history, including the record-setting $95 million penalty assessed against a Texas tree company.

What you need to know about I-9 audits/investigations

Under federal law, employers are required to verify the identity and employment eligibility of all individuals they hire, and to document that information using the Employment Eligibility Verification Form I-9. ICE uses the I-9 inspection program to promote compliance with the law, part of a comprehensive strategy to address and deter illegal employment.

Most I-9 audits progress in the following way:

  • ICE/HSI serves an employer with a Notice of Inspection, alerting them of a pending audit of their hiring records to determine whether they are in compliance with the law.
  • Employers are required to produce their company’s Form I-9s and supporting documents, including payroll records, list of employees, articles of incorporation, etc. Current law provides employers with at least three business days to produce the requested documents.
  • The HSI audit team will review each form for technical or procedural violations, and provide the employer with 10 business days to make corrections.

If employers are not in compliance with the law, an I-9 inspection is likely to result in civil fines and could lay the groundwork for criminal prosecution if they are knowingly violating the law. All workers encountered during these investigations who are unauthorized to remain in the United States are subject to administrative arrest and being removed from the country.

What’s new in 2020?

On October 21, 2019, the U.S. Citizenship and Immigration Services released a new version of the Form I-9, which all employers will be required to use for any new hire on or after May 1, 2020. Until then, employers may have the option of using the prior version (dated 7/17/2017) or the new version.

It is important to note that employers may continue to complete the I-9 entirely on paper, or have Sections 1 and 2 completed on a computer, or any combination thereof. Regulations pertaining to completion or retention of electronic I-9s remain in place, and employers working with outside vendors on electronic I-9 completion or storage systems should ensure that their systems are compliant with the ICE regulations. They should also make sure they begin using the new form on time.

The USCIS has not issued a revised M-274 Handbook for Employers in tandem with the new version of the I-9. You may continue to use the current version of the electronic M-274.

What to expect from a DOL Wage and Hour investigation

Under the H-1B program, the DOL’s Wage and Hour division is responsible for ensuring that H-1B workers are receiving the wages promised on the Labor Condition Application, and working in the occupation specified, and at the location(s) stated. To demonstrate compliance with the LCA, employers are required to maintain a Public Access File with specified documents to support the employer’s attestation listed on the LCA. The DOL can initiate H-1B-related investigations as a result of only one of four factors:

  1. The DOL receives a complaint from an aggrieved person or organization.
  2. The DOL receives specific credible information from a reliable source that the employer has failed to meet certain LCA conditions, has engaged in a pattern or practice of failure to meet such conditions, or has committed a substantial failure to meet such conditions that affects multiple employees.
  3. The Secretary of Labor has found, on a case-by-case basis, that an employer, within the last five years, has committed a willful failure to meet a condition specified in the LCA or willfully misrepresented a material fact in the LCA.
  4. If the Secretary of Labor has reasonable cause to believe that the employer is not in compliance, the Secretary may certify that an investigation be conducted.

When violations are found, the DOL may assess civil money penalties and other remedies, including back wages depending on the type and severity of the violation.

How should U.S. employers prepare in 2020?

Because employers now have a heightened risk of being audited or investigated, it is increasingly important to make sure your organization’s immigration-related documents (e.g.,   I-9 forms, PAFs) are completed correctly. Employers should identify an individual or team within the organization who is responsible for immigration compliance. The team should review the company’s current protocols, procedures, and processes for record keeping for the compliance period. The compliance program should also have a plan to follow in the event of an audit or investigation.

We also recommend that employers conduct periodic internal audits to ensure that each employee has a Form I-9 and that each H-1B employee has a corresponding PAF, and that the PAF was prepared correctly with sufficient documentation.

Finally, employers should consider providing refresher training to Human Resource professionals and other managers responsible for compliance to ensure best practices are being used at your organization. We can certainly assist with this.

With a steady uptick in I-9 audits and H-1B wage and hour compliance investigations, it is important for employers to meet all their compliance obligations, and develop and maintain the appropriate policies and mechanisms to ensure consistency and reduce the risk of being found non-compliant.

We offer a variety of programs to help you stay compliant. Please contact our Immigration Group for more information.

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