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Thursday, July 2, 2009

Alert: Immigration Audit Policy Change

by Charles M. Miller

On July 1, 2009, U.S. Immigration and Customs Enforcement (ICE) announced a policy change issuing Notices of Inspection (NOI) to 652 employers nationwide to initiate administrative I-9 audits. This policy announcement marks a shift in enforcement emphasis from the Bush administration’s policy of emphasizing criminal investigations of employers suspected of violating the federal immigration employment laws by the use of criminal search warrants based on probable cause, which do not require advance notice.

John Morton, the Department of Homeland Security Assistant Secretary for ICE, announced that the 652 businesses were selected for audit as a result of leads and information obtained through other investigative means.

Employers have had the responsibility of verifying the employment authorization and identity documents of all persons hired since the enactment of the Immigration and Reform and Control Act (IRCA).This legislation makes it unlawful for U.S. employers to hire undocumented workers. Under the Act’s provisions, employers are required to verify the identity and work eligibility of all employees, including U.S. citizens, on Form I-9. Employers have the obligation to refuse to employ a person whose authorization and/or identity documents are unacceptable.

IRCA mandates that an ICE administrative Form I-9 audit be preceded by the written Notice of Inspection (NOI), providing for the IRCA-mandated 72-hour notice. The NOI will indicate the date, time and place that the ICE agent will arrive, and the documentation that the employer is requested to produce.

It is wise for an employer to comply with an ICE NOI. If the employer does not comply with the request to present the Form I-9, ICE may compel production by issuing a subpoena. A refusal or delay in the production of the Form I-9 will be considered a violation of the retention requirements by the government. ICE may also assert general powers to obtain personnel records that pertain to the hiring and employment of an individual employee. In the absence of the employer’s willingness to produce the personnel records, ICE may issue an administrative subpoena to obtain these materials. Some employers have refused to comply with the administrative subpoena necessitating the agency to enforce the subpoena in federal court. Nevertheless, employers may need to rely on the negotiating skills of their attorneys to reasonably limit the scope of the ICE audit.

The employer’s compliance program should include a response plan for government contacts, including information for support staff such as receptionists and human resources staff members since these will likely be the first persons that the agents talk to. There should be a line of managerial response, so that support staff is aware of which company personnel should be called, and in what order. A company should be sure that legal counsel, whether in-house or external, is immediately notified as to the nature and details of the government contact at issue, as well.
Since ICE may ask consent to do a “survey” of the employees present at the employer’s work place, it is advisable to have counsel present when agency investigators are on the company’s premises. Note that, in the absence of consent by the employer to a survey, ICE may not make a warrantless search of the company’s premises.

ICE audits focus on whether employers have violated the prohibitions against knowingly employing unauthorized aliens and Form I-9 paperwork violations. While there is a good faith defense allowing employers ten days after agency notice to effect good faith I-9 paperwork corrections, DHS has not implemented the defense by either regulation or policy, and will need to be a subject of negotiation with ICE auditors. It is also important to note that there is also a statutory affirmative defense to the “knowingly hiring” charge when the employer is able to prove good faith compliance with the I-9 verification requirements.

After the audit a Notice of Intent to Fine (NIF) may result. When a NIF is issued, employers may request a hearing within 30 days of its service before an Administrative Law Judge of the Office of the Chief Administrative Hearing Officer (OCAHO), under the authority of the Executive Office for Immigration Review, within the Justice Department. Hearing requests must be in writing and filed with the ICE office designated in the NIF. If a hearing is not requested within the 30- day period, the ICE will issue a final order to cease and desist and to pay a civil money penalty. If a hearing is requested, ICE will file a complaint with OCAHO to begin the administrative hearing process which may end in settlement, dismissal, or a Final Order for civil money penalties. Employers who have faced administrative charges in the past have subsequently found their companies the focus of criminal investigations, years after the imposition of administrative civil sanctions.

While a company’s actual compliance procedures will vary depending on its size and specific industry hiring practices, these compliance suggestions are offered to employers:

1. Follow a specific hiring policy that incorporates not only the verification and record keeping provisions, but also the antidiscrimination provisions.

2. Do not request specific identity or employment authorization documents from a new employee.

3. If Forms I-9 have omissions; take immediate steps to complete the Forms I-9 now with accurate and conspicuous, albeit tardy, dates of completion.

4. Provide on-going training and resource materials for company personnel involved in the verification and record-keeping process.

5. Keep a tickler system for the reverification of employees with employment authorizations that expire.

6. Verify the documents of employees hired for three days or less should be verified prior to their first day of work to insure compliance.

7. Human resources personnel should contact legal counsel prior to an immigration-related hiring or firing.

8. Do not begin the verification process until a prospect has accepted the offer of employment.

9. Conduct regular internal Form I-9 audits at your hiring offices.

10. Use legal counsel to draft prohibitions, auditing compliance safeguards and indemnification provisions against the use of unauthorized labor when negotiating or renewing contracts involving independent contractors or subcontractors. Ensure that they comply with all federal and state labor, wage and hour laws.

11. Train your employees and managers for permissible use of independent and subcontractors. Teach them to report the suspected use of unauthorized labor by the company’s contractors.

12. Conduct contractor due diligence. Check the contractor’s company history and public records to obtain an accurate assessment of the company’s legal compliance track record.

13. Promulgate a policy prohibiting the use of any labor contractors who employ undocumented workers, subject to disciplinary action up to and including discharge.

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