Presentation Transcript

1. Government Investigations in an Enforcement Environment: Avoiding the Landmines June 29, 2011 Helen L. Konrad, Esquire Phone: (804) 775-3825 Email: hkonrad@lawmh.com McCandlish Holton PC Website: www.lawmh.com
2. Enforcement Environment Depressed economic climate has prompted Obama administration to focus on protecting US workers’ wages and jobs by encouraging enhanced enforcement by several agencies: Dept. of Labor Equal Employment Opportunity Commission Office of Special Counsel (Dept. of Justice) Immigration and Customs Enforcement (ICE)
3. Enforcement Environment FLSA and Title VII gets lots of focus but two other agencies have big enforcement budgets and they are starting to expand investigations: Office of Special Counsel Immigration and Customs Enforcement Their investigations impact ALL employers, not just those who hire foreign nationals.
4. Enforcement Environment Examples of increased enforcement against employers: 652 Audit Notices issued nationwide (7/1/09) Additional 1000 Audit Notices issued (11/19/09) ICE issues fines of $15,865,101 just through 4/09 compared to $2 million for all of 2008.
5. Enforcement Environment Recent Fines Abercrombie & Fitch agrees to settle for $1 million with NO unauthorized workers (paperwork violations/electronic storage) One Subway franchise had 109 violations = $111,078 fine Judge reduced to $27,000 No evidence of unauthorized workers
6. Office of Special Counsel, Department of Justice Investigates and assesses fines for “unfair immigration related practices” that result in: National origin discrimination Citizenship status discrimination “Document Abuse” Asking for more or different documents than required by law. Retaliation for reporting these violations
7. National Origin Discrimination Protects individuals from discrimination based on national origin. Employers cannot refuse to interview or hire an individual because of their national origin. 7
8. Citizenship Status Discrimination Protects certain individuals from discrimination based on citizenship status. Protected Class: US Citizen/National Legal Permanent Resident (LPR) Asylees Refugees Temporary Legal Resident 8
9. Discrimination Fines National Origin / Citizenship Status $275 – $2200 – each individual discriminated vs. Document Abuse $110 – $1100 – each individual discriminated vs. May also require you to rehire, with or without back pay
10. How Do They Investigate? As with Title VII discrimination, the government is looking at the general hiring and employment practices of employers to evaluate discriminatory practices: How are jobs advertised? How are applicants screened? What documentation are applicants required to show and when? What questions are asked of applicants? Are they asked of all applicants?
11. How Do Companies Get into Trouble? Advertise jobs in a discriminatory manner Ask questions prior to making offer of employment that have potential to discriminate against members of the protected class Request documentation or proof of authorization to work prior to making an offer of employment
12. How Jobs are Advertized? Almost NO jobs in U.S. can be limited to U.S. citizens. Only exceptions where “U.S. citizens only” is required by: Law Regulation Executive Order Government contract National Security? 12
13. What Questions Can I Ask During Interview or Application Process? Only two approved questions (“safe harbor” if you use exactly this wording): Are you authorized to work in the United States for any employer? Will you now or in the future require employment visa sponsorship (i.e. H-1B)? 13
14. What Can I Ask? These questions, should be asked of everyone, not just “foreign-looking” or “foreign-sounding” candidates. If the applicant answers “yes,” you MAY NOT ask: What their employment eligibility is based on When it expires If it is unlimited If they have “two forms of ID”
15. What Else Can’t I Ask? To see “two forms of ID” To see a particular document (i.e. driver’s license and Social Security Card; green card) Ask for more documents than that required to complete the I-9 Ask how the person obtained citizenship Ask how the person became a permanent resident (i.e. green card holder) Ask what the person's visa status is Ask what the person's home country is Ask what the person's native language is
16. What Is An I-9 Form? As of 11/7/86, every employer must complete a Form I-9 for every new hire – regardless of whether person is a U.S. citizen Employee must attest to citizenship status Employee must present documents from List of Acceptable Documents to show Identity; and Authorization to work Employer must review original documents to determine if they: Appear “genuine on their face”; and Relate to the individual
17. What Documentation Can Be Requested to Complete Form I-9?
18. How Can This Form Get Me in Trouble? Immigration and Customs Enforcement (ICE) Investigates whether I-9’s were completed properly and assesses fines for: “Unauthorized Workers” (hiring or continuing to employ) Paperwork violations: “Technical” violations “Substantive” violations
19. Are You Using the Most Recent Version of the I-9 Form? Effective 4/3/2009, MUST use new form with either: 2/2/09 version date; OR 8/7/09 version date Do NOT use: The 6/5/07 revision date Spanish version, except as an aid CNMI version
20. When Completing an I-9 Form, What Can I Ask? To see original documents from the List of Acceptable Documents One from List A OR One from List B AND One from List C
21. Changes to List of Acceptable Documents Can only use unexpired, valid documents If E-Verify, List B MUST have a photo
22. Form I-9 – Section 1
23. Key Issues with Section 1 MUST be completed by employee MUST check one attestation box MUST sign and date MUST complete nolaterthan date of hire
24. Common Errors in Section 1 Name backwards Date of birth backwards Attestation box incomplete If LPR: Fail to complete A# If alien authorized to work: Fail to complete A#/Admission # Fail to complete expiration of authorization to work Signed later than first date of hire Signature line shows date of birth, rather than the date it was signed
25. Form I-9 – Section 2
26. Key Issues with Section 2 Must be completed by Employer Must present only something from List A OR something from List B AND C Must review original documents at the time of completing and signing Person who signs and dates must be the person who looks at the documents Must complete within 3 business days of hire
27. Common Errors with Section 2 Complete A, B and C More is not better Put information on wrong lines Not completed within 3 days of hire Person who signs is not the person who saw original documents Completed based only on review of copies
28. What If My Employee Works Remotely? Can get an agent to complete Section 2 of I-9 on behalf of employer Notary is NOT enough Agent MUST know how to complete I-9 accurately and review originals Can use client’s Human Resource services Can use contract Human Resource Services MUST use something. Remote site does not absolve employer of responsibility
29. Form I-9 – Section 3
30. Key Issues with Section 3 Only reverify expiring employment authorization (List A or C), not identity documents (List B). Track expiration dates from either Section 1(last attestation block) OR List A OR List C in Section 2 Do NOT reverify: Expiring U.S. passport or passport card Expiring permanent resident card Expiring List B identity documents
31. Common Errors with Section 3 Failing to Track when employment authorization expires Reverifying identity documents Reverifying a name change Misunderstanding “Rehire” rules
32. Knowing Hire / Continuing to Employ Fine Schedule (For violations occurring after 3/27/08
33. Substantive / Uncorrected Technical Violation Fine Schedule * *The number of substantive violations divided by the number of employees for whom a Form I-9 should have been prepared to obtain a violation percentage.
34. Factors to Consider in Assessing Fines Size of business Good faith efforts to comply Seriousness of violations Whether violations involved unauthorized workers Employer’s history of previous violations
35. Enhance / Mitigate Fine Matrix
36. Retention Policy 3 years from date of hire OR 1 year from date of termination WHICHEVER IS LATER
37. Examples Hired: June 1, 2009 Termed: December 31, 2009 Three years from date of hire (June 1, 2012) is later than one year from date of termination (December 31, 2010). Must keep until June 1, 2012
38. Examples Hired: January 1, 2000 Termed: June 30, 2010 Three years from date of hire (January 1, 2003) is NOT later than one year from date of termination (June30, 2011) Must keep until June 30, 2011
39. Electronic Generation or Storage of I-9s Must meet these Performance Standards: Reasonable controls to ensure integrity, accuracy & reliability of the electronic generation or storage system; Reasonable controls designed to prevent and detect the alteration of an electronically completed or stored I-9, as well as identity of person making the change; An inspection and quality assurance program; A retrieval system that includes a searchable indexing system; and The ability to reproduce legible and readable hard copies.
40. New Regulations Effective 8/23/2010 Confirms Employer has three “Business” days to complete Section 2 Can use combination of paper and electronic storage systems Can change systems as long as both systems meet performance standards Audit trail – don’t need to document “views”, just “created, completed, updated, modified, altered or corrected” Not required to provide a confirmation of I-9 transaction unless employee requests it
41. Best Practices in Hiring Process and I-9 Administration Defining Policies Consistent Application of Policies Training to maximize understanding Regular Internal Audits to identify and correct problems More training
42. Who is Responsible? Who is responsible for interviewing candidates? Have they been trained on what to ask and what not to ask? How does interview/application process interface with I-9? Who is responsible for initial completion of I-9? Who is responsible for reverification of I-9? What training have these people received regarding proper I-9 procedures? What written materials have they received? How frequently are these materials updated? In writing By training
43. Do’s and Don’ts of I-9 Verification Do: Make conditional offer of employment BEFORE initiating I-9 process Perform I-9 processing to completion once conditional offer has been made Accept all documents listed on the I-9 form that “reasonably appear to be genuine”, and “relate to the individual” Contact Corporate if unsure whether a document is acceptable. Set up a tickler system to track cases that must be reverified.
44. Do’s and Don’ts of I-9 Verification Do Not: Ask for documents before a conditional offer has been made Specify which documents an employee may present (i.e. “Two forms of ID”) Refuse to accept specific documents Distinct from refusing to accept expiring documents Accept Social Security cards with restriction
45. Do’s and Don’ts of I-9 Verification DO NOT refuse to accept receipts for replacements of acceptable documents. If an employee presents receipts for any of the documents listed on an I-9, that person has 90 days from the date of hire to submit the original documents, and may work in the interim. Note: A notice that an application for work authorization has been filed with Immigration, but has not yet been adjudicated, is not a “receipt” for this purpose.
46. E-Verify What is it? Web-based method of verifying: Name, date of birth and SSN through SSA database, and Authorization to work through DHS database Does not replace I-9 process. It is an additional step. ONLY for new hires (unless a federal contract) Can NOT query existing workforce
47. E-Verify How Does it Work? No later than 3 business days from date of hire, must query the system with the following information taken from the completed Form I-9: From Section 1: Employee name Date of birth Social Security Number (required) Citizenship status, based on attestation box checked A# or I-94#, if applicable From Section 2: Document Types Expiration dates, if applicable
48. E-Verify Then What? One of three responses: Employment Authorized; SSA Tentative Nonconfirmation; or DHS verification in Process
49. E-Verify If “Employment Authorized” Record the verification number from E-Verify onto the Form I-9; or Print the E-Verify result screen and attach to Form I-9 Supposed to happen instantaneously 96% of the time
50. E-Verify If Tentative Nonconfirmation (TNC), means that employee could not be immediately verified, but does NOT mean unauthorized to work. Two types: SSA DHS
51. E-Verify TNC cont’d: Employer must: First check own data entry to ensure no errors were made If not, then immediately notify employee of the issue Employee must first be given NOTICE where they decide whether or not to contest: If he/she does not want to contest, then employer must terminate immediately, recording case verification number on Form I-9
52. E-Verify TNC cont’d: If employee wants to contest: Employer must print referral letter (link on the site) Employee must: Call toll free DHS number; or Go to local Social Security office Must be done within 8 federal business days from initial query
53. E-Verify TNC cont’d Employer must view system daily to see if issue is resolved and “employment authorized” If resolved, follow previous procedure If SSH/DHS still working on it, will say so CAN NOT TERMINATE OR HAVE ANY ADVERSE EMPLOYMENT ACTION WHILE BEING RESOLVED
54. E-Verify Final Nonconfirmation (FNC) If issue cannot be resolved, will get FNC Must terminate Write verification number on I-9 Subject to a fine of $500 - $1000 for continuing to employ someone with FNC
55. E-Verify Final Nonconformation (FNC) cont’d. Safe harbor that you did not terminate for discriminatory reasons, as long as query was performed in “good faith” DHS reviews employers’ use of E-Verify to ensure employer only uses it for new hires, unless a federal contractor Still doesn’t insulate employer from a lawsuit by an employee who is authorized to work but terminated because of FNC
56. Benefits of Enrolling in E-Verify Gives employer greater assurance on the validity of documents presented Resolves Social Security no match at time of hire Presumption that employee is properly authorized to work if E-Verify query clears Reducing exposure for fines if ever I-9 audited Access to certain client contracts Access to some State contracts Access to Federal Contracts Eligible to employ F-1 students who have Science, Technology, Engineering or Math (STEM) degrees for an additional 17 months of OPT
57. Risks of Enrolling in E-Verify High inaccuracies in underlying SSA and DHS databases Name changes Citizenship status changes No indemnification from a future lawsuit by employee who was terminated based on FNC, but was in fact employment authorized No appeal process for FNC Increased risk of audit, based on terms of MOU Loss of Federal/State/Client contract for improper compliance Fines for continuing to employ someone who received FNC, regardless of your actual knowledge of authorization to work 30 days notice to withdraw Additional administrative burden
58. Federal Contractors E-Verify is a voluntary program intended ONLY for new hires, not for existing employees Bush Administration changed that to require all federal contract and subcontract: To enroll in E-Verify; and Use for all new hires; and For all existing employees working on federal contracts Applies to contracts signed on or after 9/8/09 Authorized through 9/30/2012
59. What is a “Federal Contractor”? Someone who signs a contract with the federal government With a value of at least $100,000; and Duration of at least 120 days Someone who signs a Subcontract to work on a contract described above Value of at least $3,000
60. Federal Contractors Exceptions Federal grants or cooperative agreements, regardless of dollar amount; Medicare Reimbursement Agreements; and Student Financial Aid
61. Federal Contractors Enrollment Within 30 days from contract award date Existing contracts signed before effective date may be amended to include clause
62. Federal Contractors Once enrolled, begin querying: New hires; within 3 days from hire AFTER 90 day phase-in; Existing employees assigned to federal contract: Within 90 day phase-in; OR 30 days from assignment, WHICHEVER IS LATER
63. Federal Contractors If previously enrolled in E-Verify for at least 90 days at time of contract award, begin querying: New hires; Within 3 days of hire; Existing employees assigned to federal contract: 90 days from contract award; OR 30 days after assignment to contract WHICHEVER IS LATER
64. Federal Contractors 180 Day Option May opt to E-Verify ALL employees hired after 11/6/86 (who should have I-9 on file) within 180 days of enrollment in E-Verify; Must make this Election at time of enrollment
65. Electronic Employment Verification Systems (EEVS) SSA (SSNVS) http://www.ssa.gov/employer/ssnv.html batch processing Up to 250,000 – Answer next day 10 names – instant response Current workforce AND new hires Has NOTHING to do with authorization to work, so dangerous to rely on.
66. Social Security “No Match” Letter What is it? Letter from Social Security Administration sent when name on W-2 doesn’t match SSA’s database for that number. How many sent? 240 million W-2’s 10% don’t match Clean up easy errors on SSA’s part. Gets it to 9 million (<10%) Letter goes to EVERY employee Letter goes only to employers with at least 11 items and ½ of 1% of W-2’s submitted over 150,000 letters Most mismatches apply to U.S. Citizens
67. What to do Next? Receipt of No Match Letter is “constructive knowledge” of unauthorized worker, but Can NOT terminate solely on basis of No Match letter
68. Step 1 Employer should check own records to determine if data entry error was made by payroll. If so, send letter to Social Security Administration confirming change
69. Step 2 If not employer’s error, must notify employee of error and that employee is not receiving credit for earnings. If employee admits he or she is illegal, you MUST terminate If employee can resolve, repeat Step 1
70. Step 3 If employee can NOT resolve, Employer should: Review I-9 form to determine if disputed Social Security number is the basis for employment authorization in List C. If so, re-verify authorization to work in Section 3; Can NOT accept any document that has disputed Social Security Number; If employee can present such valid documents that appear genuine on their face, it is legal to keep working, despite the No Match Letter.
71. Key Concerns Identify what address SSA is sending mail to your company and to whose attention. Clock starts regardless of when it ends up on the “right” person’s desk Not bound to follow this procedure for employees who are no longer there, BUT can’t rehire without being deemed with knowledge of that prior no match.
72. Questions?