276,000 reasons to button up your I-9 process

Practicing happy law — i.e., keeping business clients out of trouble — is one duty of a corporate attorney. Raluca Vais-Ottosen, an immigration lawyer at DeWitt Ross & Stevens in Madison, has conducted many audits of her clients’ procedures for I-9 employment eligibility verification. Every time she does, issues arise that can get employers in trouble with the federal government. Here’s how they can avoid trouble and the hefty fines that often come with it.

If there is one thing that business owners and executives hate more than being bored, it’s paying large fines to Uncle Sam. Since that bearded gentleman already has both hands in their pockets at payroll and tax time, it’s worth their time to consider recent changes to the federal Form I-9 and its proper storage.

Before you yawn, please note that employers began using a new Form I-9, which verifies the identity and employment authorization of individuals hired for employment in the U.S., at the beginning of 2017. (A new version became mandatory in January, with yet another one being released on July 17. Employers can still use the January version until September 17. Beginning September 18, employers can only use the July 17 version.) Both issues — storage snafus and recent changes to the form — have been tripping up employers at a time when the penalties have gone up for organizations that aren’t in compliance.

Just ask a certain Minnesota staffing agency, Alpine Staffing, which might be the best example of why the storage of Form I-9 is not a trivial matter. The firm was assessed $276,000 in penalties because it produced requested I-9s in response to an audit in installments — not by the deadline. The folks at Immigration and Customs Enforcement were not amused; in fact, they were as cold as ICE after issuing a notice of inspection requesting that company produce all of its I-9s for all employees within a week.

In this case, the installment plan was frowned upon, according to Raluca Vais-Ottosen, an immigration attorney with the Madison office of DeWitt Ross & Stevens. “They did produce a good chunk of the I-9s, but then after the week passed, they discovered more I-9s they had not produced, so they went ahead and produced those right away,” she recounts. “Then, about a month later, they discovered even more I-9s that somebody else had found and they produced those … and then they had to pay $276,000 in fines.

“More than half of that amount was for producing those I-9s late because they did not have them centralized in the first place.”

Therefore, her first tip on avoiding the pitfalls of the I-9 verification pertains to storing all I-9s together in a centralized file. Federal rules and regulations don’t specify that employers are required keep the I-9 in an employee’s personnel file or whether they have to keep them centralized, so they can do either/or. As a practical matter, she says it’s much better to store all the I-9s together in one central file.

“The law does specify that ICE only has to give you three days to produce the documents after they issue that notice of inspection, so this is a matter of practicality for an employer,” she adds.

Beyond central storage

Vais-Ottosen has noticed employers getting tripped up on I-9 verification and in some cases E-Verify, a web-based system to confirm employment eligibility by comparing data on Form I-9 with information from the U.S. Department of Homeland Security. The biggest challenge she sees is that the new form is one page longer online but the accompanying set of instructions is twice as long. “The longer these forms and instructions get, the less likely it is that employers will actually read them,” she states. “It’s definitely a more cumbersome set of instructions.”

How cumbersome? Instructions for the new form went from seven pages to 15 pages. While annoying, that doesn’t sound like a lot; however, most employers didn’t read the old form or the seven-page set of instructions to begin with. The government tried to add more detail and clarity to the instructions, but Vais-Ottosen is not convinced the feds actually succeeded in doing that.

“They made it harder to follow for a lot of people,” she states. “Also, there is an entire page of definitions that should really be self-explanatory. I don’t really think we need an almost three-line explanation about what the first name or middle initial means. There is literally a 2-1/2-line explanation for what a middle initial means. This just adds to an employer’s perception of, ‘I don’t need to read this. Why would I waste time reading instructions about a middle initial?’

“If you keep going through it, you do eventually get to the meat of the I-9 regulations.”



Auto pilot error

Another challenge is that the new form has smart features that allow some boxes to be automatically populated based upon previous answers. Vais-Ottosen has heard from employers who say they get even more confused with these features. They find it easier to print the form and fill it out on paper instead.

Would she recommend filling it out on paper anyway? “Honestly, it depends on how knowledgeable the person is on the I-9 process,” Vais-Ottosen explains. “Sometimes it’s a lot easier to do it on paper. The smart features do answer a lot of the questions that employers have had a hard time with, but I would have to recommend that on a case-by-case basis.”

Another tip is more of a reminder. If the employer is engaged in E-Verify, they must remember that E-Verify only provides an affirmative defense related to the hiring of undocumented workers. It does not provide a defense for I-9 paperwork violations.

“I see a lot of employers enrolled in E-Verify and they think as long as they do the E-Verify process, they don’t have to do as much due diligence with the I-9 paperwork,” Vais-Ottosen explains. “That is a huge mistake because you can be penalized, and in fact many employers get penalized for I-9 violations, even if the entire workforce turns out to be documented.”

Yet another tip is to be sure to read the fine print — and in this case the bold print — at the top of Form I-9. There is an anti-discrimination disclosure at the top of the form with instructions and the notice specifically says that employers cannot specify which documents an employee must present. They are limited to only providing employees with the List of Acceptable Documents, and then employees must chose which documents they will provide. Form I-9 has a List of Acceptable Documents that is attached to the last page of the form.

“Most of the violations that I come across are when employers either did not read the disclaimer, or they read it but they think that they are better off asking for more documents just to make sure the person is authorized to work,” Vais-Ottosen says. “That is, in fact, a violation because it crosses the line of employment discrimination.”

Based on her experience in working with employers, other tips include:

  • Always fill out all required boxes. Don’t leave anything out, especially when it comes to required information.
  • If employers decide to make a copy of the documents they used to verify for I-9, they should do this consistently because copying the document for certain employees but not for others can also be construed as a form of discrimination. Copying the documents that you verify for I-9 is not mandatory, unless you’re enrolled in E-Verify. “A lot of employers start copying the documents because they think it’s mandatory, but that’s not always the case,” says Vais-Ottosen. “They should go over the rules before they start copying these documents.”
  • Staying clear of trouble with E-Verify starts with shoring up I-9. Many employers ask whether they should use E-Verify, and while Vais-Ottosen notes this should be done on a case-by-case basis, she adds that if you’re not on top of your I-9 process, then you’re not going to be on top of the E-Verify process, either. “If you’re not and you get audited, having a deficient process in both the I-9 and E-Verify is only going to make you, as an employer, look worse.”

For these reasons, especially in this day and age of more rigorous immigration enforcement, “employers should make sure that all of their I-9 processes and procedures are up-to-date and compliant,” she adds.

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