As part of our ongoing analysis of the recently implemented E-Verify federal contractor rule, today’s blog will focus on some unique considerations for university and college employers that may be subject to these new requirements.

My university or college participates in federal student loan and Pell grant programs. Does this make us a federal contractor?

The definition of “contract” in the federal contractor rule explicitly excludes grants and cooperative agreements so these types of arrangements will not be subject to the E-Verify requirement. Universities and colleges may, however, have contracts with federal agencies to conduct research and development in a variety of areas, including national defense, space science, applied research, biomedical, and national health, to name a few. According to the Federal Procurement Data System, almost $8 billion in contracts (excluding grants or cooperative agreement) were awarded to educational institutions in FY 2007. For these types of contracts, the university or college will be required to participate in E-Verify. Failure to comply can result in loss of federal contracts and debarment from future federal contracts.

Assuming we are a federal contractor, do we have to use E-Verify for all our of employees, including numerous temporary foreign national hires?

Under the federal contractor rule, Institutions of Higher Education are not required to use E-Verify for all new hires, and instead may elect to verify only those employees assigned to a federal contract. Universities and colleges were given this exemption by the FAR Council in light of the sheer number of student employees with intermittent employment and the resulting burden on these entities. On a cynical note, the FAR Council also weighed the fact that many universities and colleges would be more likely to insist on additional grant funding if they weren’t given some sort of exemption, and this was the lesser of two evils for the government.

It is important to note, however, that universities can still choose to use E-Verify for their entire workforce, should they find the process of figuring out the employees assigned to a contract to be too difficult. As previously mentioned, employers electing this method must provide notice to the DHS (through their E-Verify account) and initiate verification of the entire workforce within 180 days.