E-Verify & I-9 News

[Editor’s Note: today’s post is brought to you by guest blogger Bruce Buchanan, an immigration attorney in the Nashville, TN office of Siskind Susser PC.]

Atrium Companies, the owner of Champion Windows and Advanced Containment Systems, agreed to settle a case with Immigration & Customs Enforcement (ICE) for $2 million as a result of a pattern and practice of hiring illegal aliens.

An I-9 audit, conducted by ICE – Homeland Security Investigations (HSI) in February 2011, revealed 269 of Champion’s 451-person workforce consisted of undocumented aliens. Many employees’ I-9 documentation had numerous “egregiously suspect” errors, such as misspellings of agency names and/or containing the words “novelty item.” In November 2009, Thereafter, at the request of the government, all of the undocumented aliens were terminated from Champion by the end of April 2011.

The ICE HSI investigation also revealed that, since acquiring Champion, management at Atrium had become aware of the possibility of large numbers of undocumented aliens being employed at Champion’s Houston factory. A follow-up audit conducted by ICE HSI of Atrium Companies’ remaining 12 subsidiaries in May 2011 revealed that about 8.3 percent of the parent company’s 3,382 employees (excluding Champion employees) were undocumented aliens. All of these workers were terminated within a matter of weeks.

Atrium received multiple notices from the Social Security Administration (SSA) known as “no-match letters,” which indicated employee names and Social Security numbers did not match SSA records. The companies failed to take any corrective measures, resulting in the continued employment of the undocumented aliens.

The ICE announcement reported that since December 2010, Atrium Companies has revised its immigration compliance procedures to include new policies concerning the proper completion, retention and auditing of I-9 forms and for responding to SSA no match letters. Under the terms of the agreement, Atrium Companies must also hire a full-time chief compliance officer and continue to consult with immigration counsel in order to ensure the legality of its workforce.

Disclaimer: The content of this post does not constitute direct legal advice and is designed for informational purposes only. Information provided through this website should never replace the need for involving informed counsel on your employment and immigration issues.

To learn more about how I-9 Compliance Software can help you comply with Form I-9 and E-Verify requirements, click here.

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[Editor’s Note: today’s post is brought to you by guest blogger John Manley, U.S. Immigration Attorney and Co-Liaison to U.S. Customs and Border Protection.]

U.S. District Judge Thomas J. Whelan has ordered The French Gourmet, Inc. to forfeit $109,200 in illicit proceeds gained from the illegal hiring practices and pay $277,375 for its felony conviction of employing more than 10 illegal alien workers in a 12-month period.

This case has gained considerable attention and is a reminder to employers to make sure they have a proper I-9 Compliance Program.

In this case, the French Gourmet operated a restaurant, bakery and catering business for decades in La Jolla. All three defendants pleaded guilty in October to having hired numerous illegal alien workers between 2005 and 2008, and continued to employ the unauthorized workers knowing the aliens did not have legal authority to work in the United States. The defendants further admitted to hiring and employing illegal alien workers continuously as early as 2003, despite being fined in the 1990s by the former Immigration and Naturalization Service (INS) for employing illegal aliens. The pattern of illegal activity continued until May 2008 when agents from HSI searched the restaurant and arrested 18 illegal alien workers. The company admitted they repeatedly rehired illegal alien workers, even after the company received “no-match” letters from the Social Security Administration advising employees’ names did not match the Social Security numbers reported by the company on its tax returns. Source: ICE

These are heavy fines for a small business to pay. It would not surprise me if the company filed some sort of bankruptcy petition after this. ICE, however, can and will go after companies. Companies should consult with immigration lawyers to to ensure proper I-9 compliance.

According to ICE, “criminal prosecutions are just one of many tools ICE HSI uses to reduce the demand for illegal employment and protect job opportunities for the nation’s lawful workforce. That enforcement strategy also includes the expanded use of civil penalties, employer audits and debarment. In fiscal year 2011, ICE criminally charged a record-breaking 221 owners, employers, managers and/or supervisors – up from 196 in fiscal year 2010. In addition, during fiscal year 2011, ICE HSI initiated audits involving 2,496 employers nationwide – surpassing the record number conducted in all of fiscal year 2010. That figure includes 83 businesses in the San Diego area. Likewise in fiscal year 2011, ICE issued 385 final fine notices totaling more than $10 million to employers across the country, again surpassing the record fine total in fiscal year 2010.”

Disclaimer: The content of this post does not constitute direct legal advice and is designed for informational purposes only. Information provided through this website should never replace the need for involving informed counsel on your employment and immigration issues.

To learn more about how I-9 Compliance Software can help you comply with Form I-9 and E-Verify requirements, click here.

Share this with your network:

The Social Security Administration (SSA) has not yet decided whether it will resume sending No-Match letters, according to a written statement issued today. The American Immigration Lawyers Association (AILA) had posed several questions to the SSA earlier last month concerning No-Match letters in light of the DHS’ recent decision to rescind the controversial No-Match letter rule. While today’s statement was brief, we did learn the following:

• While the decision on sending No-Match letters remains to be seen, the SSA will continue sending letters directly to employees to request correction of discrepancies in their records. These letters (known as DECOR or Decentralized Correspondence letters) are not sent to employers.
• The SSA has been engaged in a quality control study through its Office of Quality Performance (OQP) whereby they will contact an employer to request SSA documentation (either by mail or phone). According to SSA’s response today, this information is not being shared with other government agencies and is to be used for SSA internal purposes only. Thus far, seventy employers from six regions (Boston, New York, Kansas City, Dallas, Denver, and Seattle) have been contacted.

SSA also indicated that is not involved in conducting E-Verify compliance audits, data mining, or other E-Verify reporting. This appears to be under the exclusive jurisdiction of the DHS.

Tomorrow, the Department of Homeland Security (DHS) will publish a proposal to rescind the controversial Social Security No-Match Rule while promoting greater participation in E-Verify, IMAGE, and other government programs. DHS had previously announced its intention to rescind the rule in early July amidst support for the E-Verify federal contractor rule.

The Social Security No-Match regulation, originally introduced in 2007 and amended in 2008, established certain mandatory steps and obligations for employers following receipt of a “no-match letter.” These letters, often labeled “Employer Correction Requests,” inform employers of a mismatch between an employee’s W-2 information and the social security records. The regulation also established a “safe harbor” for employers from evidentiary use of no-match letters against them. Implementation of the rule was challenged in federal court, leading to a suspension of no-match letters and enjoinment of the rule.

In tomorrow’s proposal, DHS outlines the basis for its policy change, including a detailed description of E-Verify improvements, new worksite enforcement and community outreach efforts that it will be implementing in the near future. In particular, DHS’s worksite enforcement strategy now includes a restructured process for worksite administrative fines, a debarment policy that prevents employers from receiving Federal contracts when they are in violation of worksite laws, and a Document and Benefit Fraud Task Forces (DBFTF) cooperative to combat the vulnerabilities exploited by identity and document fraud organizations.

An advance copy of the rule can be viewed here.  Comments can be submitted for 30 days following publication of the rule.

The Department of Homeland Security (DHS) announced today that the Obama Administration fully supports the E-Verify Federal Contractor Rule, which is currently slated to go into effect on September 8, 2009.  Up until now, the Administration had not formally expressed an opinion on the rule, while pushing back the effective date several times this year.

“After a careful review, the Administration will push ahead with full implementation of the rule, which will apply to federal solicitations and contract awards Government-wide starting on September 8, 2009.”

As part of today’s announcement, DHS also indicated that it will rescind its controversial Social Security No-match regulation which would have required employers to undertake a series of steps for employees whose names and Social Security numbers do not match.

In related news, the Senate voted on (and passed) an amendment today, offered by Senator Sessions, to the DHS 2010 appropriations bill which would permanently reauthorize E-Verify and codify the Federal Contractor rule. The Senate now has to approve the entire DHS appropriations bill and reconcile it with the House version (which had only a 2-year extension of E-Verify and no Federal Contractor provisions).

Today, the Department of Homeland Security (DHS) will publish a supplemental final rule , which sets out employer obligations after receiving a “no-match” letter. These letters are sent by the Social Security Administration (SSA) , which is responsible for processing W-2 wage and tax statements submitted by employers on an annual basis. If the combination of name and social security number on the W-2 cannot be matched to an SSA record, the SSA will attempt to resolve it by sending these “no-match” letters to employees, employers and self-employed individuals to inform them of the discrepancy. There could be any number of benign reasons why the W-2 information may not match SSA records, including typographical mistakes, unreported name changes, or inaccurate or incomplete employer records. A no-match letter could also indicate a misrepresentation or improper use of the SSN, which has given rise to this DHS rule and its 2007 predecessor.

Implementation of the rule was previously challenged in federal court last year, leading to a suspension of no-match letters until the suit can be decided. At this time, it’s unclear what effect this new supplemental rule will have on the pending federal lawsuit, although it appears from court documents that the parties to the litigation will meet soon to discuss whether their issues have been addressed by this supplemental rule.