I9-Verification

I-9 Noncompliance Horror Story: $6M Risk

02.20.2014

Author

Jeff Aleixo

i9-noncompliance-story

$6M Risk for Fairfax Co., VA Schools

Here is another I-9 noncompliance horror story about an employer who actually has been utilizing an electronic I-9 software solution since 2006. As an aside, I-9 software is a great answer to the I-9 compliance equation, assuming your provider is legit – something Abercrombie recently found out the hard way, to the tune of $1M.

Another case, involving the Fairfax County, VA public schools, exposes another danger of incorrectly implementing I-9 software. As covered by the Washington Post, an estimated 5,600 employee files were shredded by the employer in 2006.

There are numerous reasons that may have led this to happen, such as under-trained HR personnel, lack of automated cross-checks for safety built into the best I-9 software solutions or perhaps over-enthusiasm about starting fresh with the new I-9 software. This certainly is not the first nor the last time that companies face large fines for I-9 violations.

However, the reason usually lies in a misinterpretation of the principal tenet of compliant I-9 record retention: “Once the individual’s employment ends, the employer must retain [the form I-9] for either 3 years after the date of hire, or 1 year after the date employment ended, whichever is later.” (USCIS.gov Form I-9 instructions)

That means that all of Fairfax’s 5,600 incorrectly destroyed Forms I-9 had been completed by:

  1. Employees currently employed by Fairfax County public schools, OR
  2. Former employees, who (at time of shredding) were either:
  • employed for more than 3 years and separated less than 12 months from shred date, or
  • were hired fewer than 3 years prior to separation and the 3 year period had not yet passed at time of shredding.

The form I-9 retention period has been a frequent point of confusion for employers, who often question whether they can destroy I-9s for all employees, both current and former, after a period of three years, therefore resulting in I-9 noncompliance.

Use this comprehensive guide to find answers to every question related to I-9 employment eligibility verification process.

Review Your Record Retention System

One of the key takeaways from this is how important it is to review your record retention system. The Post’s article quotes Kimberly Adams, president of the Fairfax Education Association, who says in part, “It is stunning what can be found when the microscope is applied.”

That could be said of compliance with most laws, but where I-9 audits are a factor, there is also a heightened audit environment, frightening costs, potential interference with day-to-day business operations, and the ability to spread in scope across locations, jurisdictions, and even agencies. That is why it is critical for employers to conduct self-audits – just as the Fairfax schools did – in order to uncover such problems and correct whatever they can in order to avoid I-9 noncompliance and mitigate their financial exposure.

It seems the Fairfax schools have been able to get new I-9 forms completed for about 3,800 of the 5,600 destroyed forms. Even so, that does not mean they are not potentially liable for each violation. Immigration and Customs Enforcement, ICE, has not decided if they will charge Fairfax schools and only learned of the violations through the Post, but with fines per form ranging from $110 to $1,000, Fairfax faces a potential fine of anywhere between $600,000 to over $6 million dollars.

It’s interesting to note that while Fairfax school district officials have apologized to their employees and have employed an upgraded I-9 software solution to manage sensitive I-9 records since 2006, the elephant in the room is how a potential ICE fine of up to $6 million dollars in a public school system would ultimately be carried by local taxpayers. Perhaps the district officials should have been apologizing to all of them. It will be interesting to see how ICE handles this one.

Next Steps for I-9 Compliance

With all of the daily responsibilities on an HR professional’s plate, it may seem impossible to make the time for an I-9 audit project. However, when it comes to I-9 record-keeping, whether employers know they have a problem, think they may have a problem, are sure they do not have a problem, or cannot speak to what their predecessor or other employees may have done, they need to audit their I-9s.

Following a detailed checklist allows employers to find possible mistakes, provide missing information, and prove that a good faith effort was made to comply with the Form I-9 requirements.

I-9 Noncompliance Update

The purpose of the I-9 is to help employers verify the identity and employment authorization of each person they hire. Even though I-9 compliance may seem simple, it is full of obstacles that can expose employers to large fines and penalties for hiring unauthorized workers as well as simply committing paperwork violations, even if all employees are authorized to work.

It’s more important than ever for employers to ensure they have proper procedures in place, as fines related to I-9 forms or omissions increased, demonstrating the government’s efforts to enforce federal immigration laws more vigorously. With the growing number of audits conducted yearly, it is best for employers to act like they could be audited at any time. Some of the best measures to establish compliance include internal I-9 audits, ongoing I-9 training programs, E-Verify participation, using an automated I-9 solution and updating I-9 Practices and procedures. As a result, employers can ensure that that are properly handling I-9 administration, and preventing I-9 noncompliance problems in the future.

Find out how transitioning to electronic I-9 administration can help you save time, maintain I-9 compliance, and put an end to hefty fines.
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Editor’s Note: This post has been updated for accuracy and comprehensiveness.