How Your Company Can Survive an I-9 Audit

1. How Your Company Can Survive an I-9 Audit Carl Shusterman PIHRA Legal Update June 21, 2012

2. I-9 Requirements for Employers - Procedure (Part I) • Employers are required to Complete Form I-9 for ALL new hires • Day 1 - Employee must complete top portion of form • I am a: (1) Citizen or National of the U.S. (2) Lawful Permanent Resident - A# (3) Alien Authorized to Work Until… The Law Offices of Carl Shusterman

3. I-9 Requirements for Employers - Procedure (Part 2) • By Day Three, Employers Must Verify the Worker’s ID and Employment Authorization • Worker must present one List A Document (ID and Employment Authorization)  or • One List B Document (Establishes Identity) and • One List C Document (Establishes Employment Authorization) The Law Offices of Carl Shusterman

4. I-9 Requirement for Employers Procedure (Part 3) • Updating and Re-verification • Re-verify Employment Authorization for Current Employees • Re-verify or Update Employment Authorization for Re-hired Employees • Expired Documents The Law Offices of Carl Shusterman

5. I-9s – Photocopying & Retention • Retention – Paper, Microfilm, Electronic • For 3 years after hire, or • For 1 year after termination, whichever is later. • Mergers & Acquisitions • Copy Employee Documents? The Law Offices of Carl Shusterman

6. I-9 Inspections • By DHS, OSC and DOL • Written Notice of Inspection • 72 Hours Notice • Potential Civil and Criminal Penalties • Advisability of Internal Audits The Law Offices of Carl Shusterman

7. I-9 Civil Sanctions • Paperwork Violations – Up to $1,100 per employee • $1,000,000+ fine for Abercrombie & Fitch in 2010 • “Knowing” Violations – • 1st Offense: $375 – 3,200 each employee • 2nd Offense: $3,200 - 6,500 each employee • 3rd Offense: $4,300 – 11,000 each employee • Wal-Mart’s $11,000,000 fine in 2005 allowed company to escape criminal penalties The Law Offices of Carl Shusterman

8. I-9 Criminal Penalties • “Pattern or Practice” Violations • Up to $3,000 per employee • Up to 6 months imprisonment • Golden State Fence Co., a California employer, paid $4.7 million to ICE in plea bargain in 2007. U.S. Attorney sought prison terms, but Judge granted the executives probation. The Law Offices of Carl Shusterman

9. Immigration Anti-Discrimination Laws • Discrimination based on Citizenship Status • Discrimination based on National Origin • Fines for Violations • $375 – 16,000 per employee • $257,000 Fine for Immigration Discrimination – California Healthcare Employer in 2010 The Law Offices of Carl Shusterman

10. I-9 Document Abuse • Employer cannot specify which List A, B or C documents that it wishes to see • Fines: $110 - $1,100 per individual • Employers should: • Let Employee choose what documents to present • Not require extra documents • Not reject documents which appear genuine The Law Offices of Carl Shusterman

11. No-Match Letters • Constructive Knowledge? • Give Employee Opportunity to Correct • Social Security Number Verification Service (SSNVS) (800) 772-6270 • http://www.socialsecurity.gov/employer/noMatchNotices.htm (Court Injunction against proposed government regulations) Law Offices of Carl Shusterman

12. E-Verify Program A Solution for Employers? • Insulation from Liability? • Identity Theft? • Is E-Verify Ready for Prime Time? The Law Offices of Carl Shusterman

13. Remote Hiring • Employer can assign a 3rd party representative or notary public to verify the documents • Employer continues to be liable • No verification by e-mail or photocopy. Original documents need to be verified. The Law Offices of Carl Shusterman

14. J-1 / F-1 Visa Holders • USCIS does not issue EAD • The documents for I-9 purposes include combination of the following under List A : • Unexpired foreign passport number • 11-digit Form I-94/I-94A number and expiration date, and: • J-1: Form DS-2019 number and expiration date of employment authorization listed on the form • F-1: Form I-20 with the designated school official’s endorsement for employment on page 3; • Important: Ensure that they enter their admission number from Form I-94/ I-94A in Section 1 The Law Offices of Carl Shusterman

15. F-1 Students Working on OPT • Normally can only work until the expiry date on EAD • Exception- If H-1B petition is filed on their behalf, then can continue to work until October 1. The Law Offices of Carl Shusterman

16. F-1 on expired OPT with H-1B filed • Documents under List A • OPT EAD (Expired) along with Form-I-20 which shows that the cap-gap extension was endorsed by the student’s designated school official, • Valid till Sept. 30 or until the date the petition is withdrawn or denied. • Important: You must re-verify employment authorization when the Form I-20 cap-gap endorsement expires- no later than October 1. The Law Offices of Carl Shusterman

17. H-1B Extensions • Employee authorized to work while timely filed extension petition is pending for 240 days, or until the petition is denied. • For I-9 purposes- • Write “240-Day Ext.” and record the date you submitted Form I-129 to USCIS in the margin of Form I-9 next to Section 2. The Law Offices of Carl Shusterman

18. I-9s for H-1B Extensions, cont. • Retain the following documents: • A copy of the new Form I-129; • Proof of payment for filing a new Form I-129; • Evidence that you mailed the new Form I-129 to USCIS. • Receipt of the H1- B filing • Re-verify employment authorization in Section 3 once you receive a decision on the H-1B petition The Law Offices of Carl Shusterman

19. AC-21 Portability • An H-1B employee –can start working for you as soon as you file the Form I-129 petition for Change of Employer • For I-9 purposes: • H-1B employee’s Form I-94/I-94A issued for employment with the previous employer, along with his or her foreign passport • Write “AC-21” and record the date you submitted Form I-129 in the margin of Form I-9 next to Section 2. The Law Offices of Carl Shusterman

20. How to Minimize Your Liability • Have An Outside Party Audit Your I-9s • After the Audit, Correct Flawed I-9s • Do Not Destroy Defective I-9s • How to Properly Correct I-9s • Training Sessions for Persons Completing I-9s • Consult USCIS Employers Handbook The Law Offices of Carl Shusterman

21. How to Obtain Additional Information and Stay Updated • Immigration Laws, Regulations & Procedures are constantly changing • USCIS’ new “I-9 Central” website • USCIS’ Handbook for Employers (June 2011) • Our website –www.shusterman.com • Free, monthly e-mail newsletter – Over 60,000 subscribers The Law Offices of Carl Shusterman