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I-9 Compliance and Administrative Audit

  1. When must an employer verify a newly hired employee’s employment authorization and complete Form I-9?
  2. When is completing Form I-9 not required?
  3. Will an employer be subject to sanctions or penalties if its employee hired on or before November 6, 1986 is in the U.S. illegally?
  4. How should an employer complete Form I-9 for rehires?
  5. If an employee is located in a different state than the employer, does the employer need to see a physical copy of his/her employment documents? Is a Notary acceptable as the employer’s representative?
  6. What should an employer do in situations where the employee has used another name which is not obtained through a legal change of name?
  7. If an employee provides an Alien Number or Admission Number on Section 1 of Form I-9, can an employer ask to see a document with that number?
  8. How should an employer verify employment authorization for its employee who receives cap-gap extension?
  9. How does an employer complete Form I-9 for its newly hired H-1B employee?
  10. How should an employer reverify employment authorization for an H-1B employee who timely filed an extension but has not received the approval notice?
  11. When are receipts for employment authorization documents in lieu of actual documents from the Lists of Acceptable Documents acceptable for I-9 purposes?
  12. When are employers required to reverify employment authorization or update I-9 documents?
  13. For how long must an employer keep the I-9 files for each employee?
  14. If an employer finds a mistake on a previously completed Form I-9, how should the employer correct the mistake?
  15. What should an employer do if an invalid version of Form I-9 was completed for an employee at the time of hire?
  16. What is the procedure of a government I-9 audit?

E-Verify

  1. What is E-Verify and how do employers participate in E-Verify?
  2. Can an employer use E-Verify to verify employment authorization of an existing employee?
  3. Can employers use E-Verify to verify rehires?
  4. Can employers contract another company to perform E-Verify queries?
  5. Can a temporary staffing agency E-Verify the employee the day s/he completes the Form I-9 or when s/he starts employment?
  6. Is employer required to enter visa number in E-Verify when this information is not requested on Form I-9?
  7. Is Social Security number required for Form I-9 and E-Verify?

I-9 Compliance and Administrative Audit

Q: When must an employer verify a newly hired employee’s employment authorization and complete the Form I-9?
A: An employer must complete Form I-9 each time it hires any person to perform labor or services in the U.S. in return for wages or other remuneration. The law defines remuneration as anything of value given in exchange for labor or services, including but not limited to food and lodging. The employee must complete Section 1 of Form I-9 at the time of “hire”, defined as the commencement of employment for wages or other remuneration. Alternatively, s/he may complete Section 1 of Form I-9 before time of hire, but no earlier than acceptance of the job offer. The employer must review the employee’s employment authorization document(s) and complete Section 2 of Form I-9 within three business days of the hire. For example, if the employee begins employment on Monday, the employer must complete Section 2 by Thursday.

If an employee is hired for fewer than three business days, then Sections 1 and 2 of Form I-9 must be fully completed by the first day of employment for pay begins.

Q: When is completing Form I-9 not required?
A: Form I-9 is not required for persons:

1. Hired on or before November 6, 1986 (on or before November 27, 2007 if employment is in the Commonwealth of the Northern Mariana Island (CNMI)) who are continuing in their employment and have a reasonable expectation of employment at all times; (This exception does not apply to seasonal employees or employees who change employers within a multi-employer association. Other limitations may also apply.);

2. Employed for casual domestic work in a private home on a sporadic, irregular, or intermittent basis;

3. Independent contractors;

4. Providing labor to a company pursuant to a contact between his/her employer and the company; (For example, Microsoft does not need to complete Form I-9 for an IT consultant who is employed by its contractor to provide IT services to Microsoft.)

5. Not physically working on U.S. soil.

Q: Will an employer be subject to sanctions or penalties if its employee hired on or before November 6, 1986 is in the U.S. illegally?
A: No. The employer will not be subject to employer sanctions penalties for retaining an employee who is not authorized to work in the U.S. if the employee was hired on or before November 6, 1986.

Q: How should an employer complete the Form I-9 for rehires?
A: If an employer rehires its employee within three years of the date that a previous Form I-9 was completed, the employer can choose to (1) complete a new Form I-9 for its rehire, or (2) complete Section 3 of a previously completed Form I-9. To complete Section 3, the employer must:

· Review the original Form I-9 to determine if the employee is currently authorized to work. If his/her employment authorization has expired, the employer must determine whether reverification is required.
· If reverification is required, request that the employee present an unexpired List A or List C document. Do not reverify an employee’s List B document. Enter the document information and the date of rehire in the spaces provided in Section 3. If the current version of Form I-9 is different from the previously completed Form I-9, complete Section 3 on the current version and attach the new Form I-9 to the previously completed Form I-9.
· If reverification is not required, Section 3 of the previously completed Form I-9 may be used to record the rehire date.
· Sign and date Section 3.

If the employer is reverifying on a new Form I-9, complete Section 1 and Section 3, and retain the new Form I-9 with the previously completed Form I-9.

Q: If an employee is located in a different state than the employer, does the employer need to see a physical copy of his/her employment documents? Is a Notary acceptable as the employer’s representative?
A: The employer or its authorized representative must physically examine the documents provided, meaning that there should not be utilization of modern technology such as Skype or Facetime. USCIS has taken the position that employers may rely on notaries, but also has stated that the employer or its authorized representative must sign Section 2 of Form I-9. Therefore, Form I-9 is not considered complete if a notary public attaches an attestation to Form I-9 instead of providing a signature in Section 2.
Moreover, many states recently have enacted laws that prohibit notaries to assist with the I-9 process for remote employees, as many notaries were merely notarizing the forms and document copies, rather than acting as the employer’s agent and completing the Form I-9 as such agent. Therefore, until further guidance is issued, it is strongly recommended that employers enlist reliable individual(s) to serve as the employer’s agent for purpose of completing Form I-9.

Q: What should an employer do in situations where the employee has used another name which is not obtained through a legal change of name?
A: If the employer has reason to believe that its employee’s identity is different from that used to complete the Form I-9, the employer should complete a new Form I-9, write the original hire date in Section 2, attach the new Form I-9 to the previously completed Form I-9, and include a written explanation.

Q: If an employee provides an Alien Number or Admission Number on Section 1 of Form I-9, can an employer ask to see a document with that number?
A: No. The employee is not required to present a document to complete Section 1 of Form I-9. When the employer completes Section 2, the employer may not ask to see a document with the employee’s Alien Number or Admission Number or otherwise specify which document(s) an employee may present. For example, if the employee presents a valid driver’s license (List B document) and a Social Security number (List C document), the employer may not ask to see the employee’s green card (List A document).

Q: How should an employer verify employment authorization for its employee who receives cap-gap extension?
A: F-1 students whose H-1B petitions are timely filed with an October 1 start date may be eligible for a cap-gap extension of status and employment authorization through September 30 of the calendar year for which the H-1B petition is being filed. If an F-1 student is not participating in Optional Practical Training (OPT) when an H-1B petition is filed, then his or her F-1 status is automatically extended but s/he will not be work authorized after September 30 until the H-1B petition is approved.

If an F-1 student is participating in OPT when the H-1B is filed, then the student will receive automatic extension on his or her F-1 status as well as OPT work authorization. If the H-1B petition is approved, then the student will remain authorized to work as an F-1 student with OPT through September 30. In this case, the student’s expired OPT Employment Authorization Document (Form I-766), together with Form I-20 indicating cap-gap extension endorsed by the student’s Designated School Official, would qualify as a List A document. The employer should enter these documents in Section 2 under List A (or Section 3 if reverifying) of Form I-9. These documents are acceptable for establishing employment authorization through September 30 of the year in which the employer filed the H-1B petition or until the H-1B petition is rejected, denied, or withdrawn, whichever is earlier. The employer must reverify employment authorization when the Form I-20 cap-gap endorsement expires, but no later than October 1.

Q: How does an employer complete Form I-9 for its newly hired H-1B employee?
A: If the employer files an H-1B petition for its prospective foreign worker and USCIS approves the petition, then the employer will receive Form I-797, Notice of Approval, from USCIS, which indicates that the foreign worker has been approved for H-1B status. Once the employee starts working for the employer, the employer must complete a Form I-9 for this employee.

Under the American Competitiveness Act in the Twenty-First Century (AC-21), an H-1B employee who is changing employers within the H-1B program may begin working for the employer as soon as the employer files a Form I-129 petition on his or her behalf for change of employer. Therefore, if an employer hires a foreign national with an approved H-1B petition filed by his or her previous employer, the current employer must complete a new Form I-9 for the employee. The H-1B employee’s Form I-94/Form I-94A issued for employment with the previous employer, along with his or her passport, would qualify as a List A document. The employer should write “AC-21” and write the date it submitted Form I-129 to USCIS in the margin of Form I-9 next to Section 2.

Q: Our employee’s H-1B status is expiring soon and we timely filed an H-1B extension. If the H-1B status expires before the extension request is approved, how should an employer reverify the H-1B employee’s work authorization?
A: After submitting a timely filed H-1B extension petition, the H-1B employee is authorized to continue to work for a maximum period of 240 days while the petition is being adjudicated, or until UCSCIS denies the petition, whichever is earlier. Upon submitting the extension petition, the employer should write “240-Day Ext.” and write the date the employer submitted Form I-129 to USCIS in the margin of Form I-9 next to Section 2. The employer must reverify the employee’s employment authorization in Section 3 of Form I-9 once it receives a decision on the H-1B petition or by the end of the 240-day period, whichever is earlier. If the version of the form used for the previous verification is no longer valid, the employer must reverify the H-1B employee on a new Form I-9 and attach it to the previous Form I-9.

Q: Must an employer attach the H-1B Receipt Notice for H-1B extension request to Form I-9?
A: No. The I-9 law does not require that the employer attach the Receipt Notice to Form I-9. As a practical matter, it is advisable to do so to keep a clear record of the H-1B employee’s legal status and work authorization. However, receipts showing renewal of employment authorization are NOT acceptable documents in lieu of actual work authorization documents from the Lists of Acceptable Documents. Therefore, the Receipt Notice for H-1B extension request cannot replace the actual Approval Notice.

Q: When are receipts for employment authorization documents in lieu of actual documents from the Lists of Acceptable Documents acceptable for I-9 purposes?
A: The “receipt rule” permits an employee to present a receipt of actual employment authorization document to show that s/he is work authorized at the time of initial hire or reverification, when s/he does not have a document listed on the Lists of Acceptable Documents for Form I-9. There are three types of documents that qualify under the “receipt rule”:
1. A receipt for the application for a lost, stolen, or destroyed document (90-day receipt);
2. Arrival/Departure Record (Form I-94/94A) with a temporary I-551 stamp and photograph (expiration date on stamp);
3. Arrival/Departure Record (Form I-94/Form I-94A) with refugee admission stamp (90-day receipt).
After expiration of the receipt validity period, the employee must present the actual document for which the receipt was presented. Presenting another receipt at the end of this period is not permissible.
Furthermore, receipts showing application for an initial grant of employment authorization or for renewal of employment authorization are not acceptable.

Q: When are employers required to reverify employment authorization or update I-9 documents?
A: When an employee’s employment authorization document expires, the employer must reverify his or her employment authorization no later than the date the document expires. However, the existence of an expiration date on certain employment authorization documents does not preclude continuous employment authorization. For example, U.S. citizens and noncitizen nationals never need reverification. Therefore, do not reverify the following documents: an expired U.S. passport or passport card, an Alien Registration Receipt Card/Permanent Resident Card/Green Card (Form I-551), or a List B document that has expired.

Q: For how long must an employer keep the I-9 files for each employee?
A: Employers must retain an employee’s completed Form I-9 for as long as that employee works for the employer. Once the individual’s employment is terminated, the employer must retain the Form I-9 either three years after the date of hire, or one year after the date employment is terminated, whichever is later. Forms I-9 can be retained on paper or microform, or electronically.

If an employer completes and retains Forms I-9 in paper format only, then it must retain original Forms I-9 with original handwritten signatures for three years after the date of hire or one year after the date the individual’s employment is terminated, whichever is later.

Q: If an employer finds a mistake on a previously completed Form I-9, how should the employer correct the mistake?
A: The employer can draw a line through the inaccurate information, write the correct information on Form I-9, and initial and date the correction. The employer should also make a note in the file that a self-audit was completed on that date.

Q: What should an employer do if an invalid version of Form I-9 was completed for an employee at the time of hire?
A: If the wrong version of the Form I-9 was completed when the employee was hired, an employer should try to rectify the error. The best way would be for the employer and employee to complete the current version of Form I-9 and staple the previously completed Form I-9 to the current version. Include an explanation of what happened and sign and date the explanation. If the employer is unable to have the employee and employer complete the current version of Form I-9, the employer could try to rectify the error by:
1. Stapling the outdated, but complete I-9, to the current version and
· Sign the current Form I-9 version;
· Include an explanation of why the current version is attached; and
· Sign and date the explanation
2. Writing an explanation of the situation and
· Attach the explanation to the completed outdated Form I-9; and
· Sign and date the explanation

Q: What is the procedure of a government I-9 audit?
A: I-9 audit is conducted by the U.S. Immigration and Customs Enforcement (ICE). The audit process is initiated by the service of a Notice of Inspection (NOI) upon an employer compelling the production of Forms I-9. The employers are provided at least three business days to produce the Forms I-9. Often, ICE will request the employer to provide supporting documentation, which may include a copy of the payroll, list of current employees, Articles of Incorporation, and business licenses.

ICE agents or auditors then conduct an inspection of the Forms I-9 for compliance. When technical or procedural violations are found, an employer is given ten business days to make corrections. An employer may receive a monetary fine for all substantive and uncorrected technical violations. Employers determined to have knowingly hired or continued to employ unauthorized workers will be required to cease the unlawful activity, may be fined, and in certain situations may be criminally prosecuted. Additionally, an employer found to have knowingly hired or continued to employ unauthorized workers may be subject to debarment by ICE, meaning that the employer will be prevented from participating in future federal contracts and from receiving other government benefits.

The best practice to assess an employer’s compliance efforts and ensure full compliance with the laws is to have annual attorney-led external immigration compliance audits or internal independent audits. These private audits focus on remediation, including correcting I-9 deficiencies and mitigate potential penalties.
E-Verify

Q: What is E-Verify and how do employers participate in E-Verify?
A: E-Verify is electronic employment verification system operated by USCIS. It provides an automated link to federal database to help participating employers confirm employment authorization of new hires. E-Verify does not replace the Form I-9 requirement. Rather, after completing a Form I-9 for the new employee, the employer should create a case in E-Verify that includes information from Sections 1 and 2 of Form I-9. After creating the case, the employer will receive a response from E-Verify regarding the employment authorization of the employee.

Employers wishing to participate in E-Verify can enroll E-Verify through http://www.uscis.gov/e-verify. E-Verify is free to employers and is available in all 50 states and U.S. territories with the exception of American Samoa.
In addition, participating in E-Verify is a mandatory prerequisite for an employer who wishes to hire F-1 students seeking a 17-month extension of their OPT under the Science, Technology, Engineering, Mathematics (STEM) Designated Degree Program.

Q: Can an employer use E-Verify to verify employment authorization of an existing employee?
A: No. With the exception of certain federal contractors, never use E-Verify to reverify an existing employee. A participating employer can only use E-Verify to electronically verify employment authorization of its newly hired employee. However, federal contractors can use E-Verify for existing employees if they have been rewarded a federal contract on or after September 9, 2009, that contains the Federal Acquisition Regulation (FAR) E-Verify clause. For more information regarding the FAR E-Verify clause, please review the E-Verify Supplemental Guide for Federal Contractors.Q: Can employers use E-Verify to verify rehires?
A: Yes, although using E-Verify for rehires is not required for participating employers. If the employer rehires a former employee within three years of his or her previous hire date, the employer may rely on the information on his or her previous Form I-9.
If the employer never created an E-Verify case for the rehired employee and his or her previous Form I-9 lists an expired List B document, then the employer must complete a new Form I-9 and a case for the employee in E-Verify.

If the employer previously created an E-Verify case for the rehired employee and his or her previous Form I-9 lists an expired List B document, then the employer may either:
Complete Section 3 of the employee’s previous Form I-9 and not create a new case for the employee in E-Verify or
Complete a new Form I-9 for the employee and create a new case for the employee in E-Verify.

Q: Can employers contract another company to perform E-Verify queries?
Yes. Companies big and small often delegate their personnel matters including payrolls, I-9 verification matters, and employee benefits to Professional Employer Organizations (PEO). The PEO must register in E-Verify as an Employer Agent (formerly known as Designated Agent) to be able to perform E-Verify queries on behalf of a client company. Please be aware that even though the PEO handles the I-9 compliance matters for its client company, both the client company and the PEO are accountable for ensuring that they comply with Form I-9 and E-Verify rules, because both the client company and the PEO must sign a Memorandum of Understanding (MOU) in order to enroll E-Verify.

In general, there are two types of PEOs:
· Co-employers: These PEOs hire a client company’s employees, thus becoming the employer of record for tax purposes and insurance purposes. It then leases them back under contract to the original employer. Employees who work for the client of the PEO are considered to be the employees of both the PEO and the client company, even though the employee is performing only one set of services for both co-employers.

· Administrative services organizations: These PEOs provide outsourcing of human resources tasks but do not create a co-employment relationship. Tax and insurance filings are done by the PEO, but under the client company’s Employer Identification Number.

Q: Can a temporary staffing agency E-Verify the employee the day s/he completes the Form I-9 or when s/he starts employment?
A: The employer may create a case in E-Verify as soon as the Form I-9 is complete. If the temporary staffing agency is the employer, then it can create a case in E-Verify as soon as the Form I-9 is complete.

Q: Is employer required to enter visa number in E-Verify when this information is not requested on Form I-9?
A: No, inputting the visa number into E-Verify is optional.

Q: Is Social Security number required for Form I-9 and E-Verify?
A: The Social Security number is optional for completing Form I-9 BUT is required if the employer participates in E-Verify. E-Verify requires an employee’s Social Security number to verify employment eligibility with the Social Security Administration’s database.

Additional information regarding I-9 and E-Verify can be found on USCIS website (www.uscis.gov), ICE website (www.ice.gov), and Handbook for Employers – Guidance for Completing Form I-9

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