Department of Homeland Security Replaces No-Match Rule with E-Verify System

In December 2007 and December 2008 this column reported on developments in the Homeland Security Department’s attempts to enforce its No-Match Rule. The No-Match Rule made employers accountable for resolving social security number mismatches that the Social Security Administration (“SSA”) brought to the employer’s attention. In the wake of President Obama’s election and the litigation to enjoin enforcement of the No-Match Rule, on August 19, 2009 the Department of Homeland Security (“DHS”) published a proposed rule to rescind the No-Match Rule. The DHS explained that it is rescinding the Rule in order to focus enforcement efforts on employers hiring undocumented workers through the E-Verify program. While E-Verify has existed since 1996, federal contractors were required to use E-Verify beginning September 8, 2009. Many states have enacted, or are considering legislation that either mandates or encourages the use of E-Verify for public contractors, state agencies and/or private employers. Contractors that enter into federal contracts after September 8, 2009 that contain the E-Verify requirement in their agreement are required to use the E-Verify program. This requirement applies to prime contracts for $100,000 or more of work and to subcontracts for $3,000 or more of work. A covered federal contractor must ensure that its subcontractors use the E-Verify program. Federal contractors must use the E-Verify program for all new hires, and in addition must use E-Verify to screen current employees assigned to work on the covered federal contract. Federal contractors mandated to use E-Verify for the first time have 30 days from the date of the contract to enroll in the E-Verify program and 90 days from the date of enrollment to begin using E-Verify for new employees and existing employees working on the contract. The E-Verify program rules expressly forbid employers from using E-Verify to check on existing employees unless the employers are performing under a covered federal contract. However, any employer may use E-Verify for new hires. When there is no federal contract mandating use of E-Verify, the employer may not submit the person’s name to E-Verify until the new employee has been offered the job, has accepted the job and has submitted Form I-9. The program’s rules ban the use of E-Verify as a pre-screening tool. Once the new hire submits Form I-9 to the employer, the employer enters the necessary information into the E-Verify database. The employee’s information must be entered within three business days from the date of hire. E-Verify will communicate one of three results to the employer: employment authorization, SSA Tentative Nonconfirmation (both of which are immediate responses), or DHS Verification in Process which yields a result of authorization or nonconfirmation within 24 hours. A “SSA Tentative Nonconfirmation” result means that there is an information mismatch with the SSA and sets a time-sensitive process in motion. The employer must inform the employee of the nonconfirmation and the employee can contest the mismatch and resolve the discrepancy with either the DHS or the SSA. The employee is afforded eight federal government workdays to contact either agency to resolve the discrepancy. Should the employee contest the mismatch on time, then the employer must permit the employee to continue working and may not take disciplinary action against the employee. Once the employee contacts the DHS or the SSA, the employer will receive one of four results: 1) employment authorized, 2) review and update employee data, then resubmit, 3) final nonconfirmation, or 4) DHS no show. Upon receipt of one of these results, the employer must resolve the case in E-Verify. However, if the employee chooses not to contest the nonconfirmation with either agency, then the employer may terminate the employee’s employment. While there is no express directive in the E-Verify program documents to terminate an employee after receipt of final nonconfirmation in a contested case or an unconstested nonconfirmation case, an employer’s failure to terminate an employee in these two circumstances will be presumed to be a knowing, unlawful employment of an unauthorized alien under IRCA, 8 USC §1324(a). After the non-confirmation becomes final, the employer must report to E-Verify whether the employer has terminated the employee’s employment. The civil and criminal penalties imposed by federal law for knowingly employing an illegal alien range from a $250 fine for employing one unauthorized individual, up to $10,000 for each unauthorized employee if the employer is a repeat violator. A criminal conviction may lead to imprisonment for up to six months. Additionally, an employer that uses E-Verify must display an E-Verify Poster and an Anti-Discrimination Poster in an area that is visible to prospective employees to show that it participates in this program. These posters must be in English and Spanish. For additional information, please contact Patrick W. McGovern, Esq. or Kristina E. Chubenko, Esq. This alert is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. It is recommended that readers not rely on this publication but that professional advice be sought for individual matters.