Recent Developments in Employment-Based Immigration for Corporate Counsel

1. Recent Developments in Employment-Based Immigrationfor Corporate Counsel Elise Fialkowski, Esq. Theodore Murphy, Esq. Klasko, Rulon, Stock & Seltzer, LLP Philadelphia New York 1800 JFK Blvd. Suite 1700 317 Madison Ave. Suite 1518 Philadelphia, PA 19103 New York, NY 10017 215.825.8600 212.796.8840www.klaskolaw.com

2. H. Ronald Klasko, Esq. • Ron Klasko is the Managing Partner of Klasko, Rulon, Stock & Seltzer, LLP and has been providing immigration assistance and solutions to leading universities, research institutions, hospitals, multinational corporations, and individuals for over 25 years. • Ron is a former National President of the American Immigration Lawyers Association and served for 3 years as the bar association’s General Counsel. He is a past Chair of AILA’s Department of Labor National Liaison Committee, its Task Force on H and L Visas and Business Immigration Committee. Mr. Klasko is one of only two recipients of the American Immigration Lawyers Association Founders Award, bestowed upon the individual who has had the most positive impact on immigration law. • Ron has been chosen as one of twelve top tier immigration lawyers in the U.S. by The Chambers Global Guide. He is selected annually for inclusion in Best Lawyers in America. The International Who’s Who of Business Lawyers 2007 edition selected Ron as the “most highly regarded” business immigration lawyer in the world. He is a frequent author and lecturer on business-related immigration topics and is a former Adjunct Professor of Immigration Law at Villanova University Law School. • Ron is a graduate of the University of Pennsylvania School of Law.

3. Elise A. Fialkowski, Esq. • Elise Fialkowski has practiced immigration law for more than 14 years and is a Partner at Klasko, Rulon, Stock & Seltzer, LLP, with offices in Philadelphia and New York. Elise regularly assists U.S. and international corporate clients who seek to hire or transfer foreign employees as well as foreign individuals seeking employment in the United States as health care professionals, executives, managers, and scientists. • Elise has particular expertise in advising employers with regard to compliance with the Immigration Reform and Control Act including I-9 Employment Eligibility verification and worksite enforcement issues.  A member of the American Immigration Lawyers Association, Elise serves on the Executive Committee of its Philadelphia Chapter. • A Phi Beta Kappa graduate of the University of North Carolina at Chapel Hill, (B.A.1987), Elise received her law degree from the Villanova University School of Law (J.D., magna cum laude, 1991).

4. Theodore J. Murphy, Esq. • Theodore J. Murphy (Ted) serves as counsel of Klasko, Rulon, Stock & Seltzer, LLP and has been involved with immigration for the past 14 years - over a decade with ICE and the former INS.  • As one of the government's most experienced attorneys, Ted represented the Agency in all matters before the Immigration Courts and Board of Immigration Appeals, handling criminal, national security, fraud and employer sanction cases.  Ted has served as a Special Assistant United States Attorney and as an Adjunct Professor of Law at Temple University Beasley School of Law.  • In addition, he is a veteran of the United States Army's 82nd Airborne Division. Ted received his undergraduate degree at Georgetown University (B.A. 1983) and his Law Degree (J.D. 1994) and Masters of Law (International Law) (LL.M. 1997) from Temple University.

5. DELVACCA AGENDA Overview - Brave New World for Employers • - New government enforcement priorities and techniques; • - Penalties for non-compliance, including criminal liability; • - Impact of State and local laws; • - Developing a policy for social security no-match letters; • - I-9 Compliance; • - Developing employer best practices; • - Choosing whether to participate in voluntary government programs (E-Verify, IMAGE).

6. OVERVIEWBrave New World for Employers • Shortages of legally authorized employees • Lack of options to legalize workforce • Prospects for immigration legislation • State and local enforcement • Recent ICE enforcement initiatives • ICE raids • Change from civil to criminal penalties

7. ICE EnforcementPriorities and Techniques • "Worksite enforcement actions target a key component of the illicit structure that enables illegal immigration to flourish.  No employer, regardless of industry or location is immune from complying with the nation's laws.  ICE and our law enforcement partners will continue to bring all of our authorities to bear in this fight using criminal charges, asset seizures, administrative arrests and deportations."  Julie Myers, Assistant Secretary for Homeland Security, U.S. Immigration and Customs Enforcement issued a statement on September 27, 2007

8. ICE Enforcement Strategy • Priorities • Promote national security • Protect critical infrastructure • Deport illegal aliens • Enforce fair labor standards • Trend toward Task Groups – Agency collaboration with local law enforcement • “Continue to conduct robust investigations at other places of employment”

9. ICE Worksite Arrests Fiscal Year Criminal Administrative 2002 25 485 2003 72 445 2004 160 685 2005 176 1,116 2006 716 3,667 2007 863 4,900 Criminal arrests include corporate officers, employers, managers and contractors. Administrative arrests are illegal alien workers.

10. Audit v. Raid Notice of Inspection: must give employer 3 days notice unless ICE has a search warrant. Notice of Intent to Fine Technical versus Substantive violations ICE has the authority to use wiretaps ICE has the authority to establish and operate undercover investigations ICE utilizes confidential informants ICE coordinates with IRS, DOL and other agencies ICE Investigative Techniques

11. Penalties for Non-Compliance • Civil – Effective March 27, 2008 • I-9 paperwork violations ($110 to $1,100) • National origin and citizenship discrimination • Knowing hire fines • (1st offense - $375 to $3,200 for each violation) • (2nd offense - $3,200 to $6,500 for each violation) • (3rd offense - $4,300 to $16,000 for each violation).

12. Penalties for Non-Compliance • Criminal • Pattern or practice of hiring unauthorized aliens • Harboring/transporting/sheltering/smuggling/ encouraging unauthorized aliens to remain in the U.S. • Mail fraud, wire fraud, document fraud, social security, fraud, identity theft, RICO • Fines, forfeitures and imprisonment • Liability relating to use of contractors and subcontractors

13. Noteworthy Cases • Wal-Mart March 2005 • IFCO April 2006 • Swift & Co. December 2006 • Mohawk Industries 2004, 2007 • RCI February 2007 • Garcia Labor Co. March 2007 • Michael Bianco, Inc. March 2007 • Sun Drywall & Stucco, Inc. March 2007

14. Noteworthy Cases • Tarrasco Steel May 2007 • American Staffing/Del Monte June 2007 • Koch Foods, Ohio August 2007 • Anna II, Inc. October 2007 • Pepe’s Cabinets November 2007 • Micro Solutions Enterprises February 2008 • IFCO (continued) February 2008 • RCI (continued) March 2008

15. RICO - Racketeer Influenced and Corrupt Organizations Statute • Employers who have illegal aliens to depress wages have new fear: employees using racketeering laws to take them to court • 1996 change to RICO – includes those who knowingly hire illegal aliens – triple damages • January 2006 - $1.3 million judgment against Zirkle Fruit Co. of Washington (plus legal fees) • 2006 - Mohawk Industries, Inc. – 2nd largest US carpet manufacturer; conspiracy to depress wages by hiring illegal aliens • August 28, 2006 – RICO charges brought by Janitors against Wal-Mart dismissed in Zavala v. Wal-Mart.

16. Impact of State and Local Laws • As of December 31, 2007, at least 1562 pieces of legislation related to immigrants had been introduced among the 50 state legislatures – of the 240 that became law – 29 effect employment in approximately 20 states. • Arizona, Arkansas, Colorado, Georgia, Hawaii, Illinois, Iowa, Kansas, Louisiana, Maine, Michigan, Minnesota, Mississippi, Montana, New Mexico, Oklahoma, Oregon, Tennessee, Texas, Utah, West Virginia. • Some states require E-Verify while Illinois prohibits it.

17. Impact of State and Local Laws Companies that knowingly hire illegal workers may face: • Possible loss of business licenses – Arizona, Tennessee, West Virginia • Possible loss of government grants and contracts – Arkansas, Colorado, Delaware, Georgia, Idaho, Iowa, Massachusetts, Minnesota, Oklahoma, Pennsylvania, Tennessee, Texas

18. “No-Match” Regulations • DHS/ICE issued regulations on August 15, 2007 to be effective September 14, 2007. • On August 31, 2007, the U.S. District Court for the Northern District of California issued a temporary restraining order, which enjoined the implementation of the no-match regulations. • On October 10, 2007, the same District Court granted a motion for a preliminary injunction, which enjoins the implementation of the no-match regulations.

19. “No-Match” Regulations • On March 21, 2008 the Department of Homeland Security announced a Supplemental Proposed Rule to address and clarify issues raised by the US District Court. DHS plans on requesting the preliminary injunction be lifted. Federal Register/ Vol. 73, No. 59/ Wednesday, March 26, 2008/ Proposed Rule. • On March 24, 2008 the Office of Special Counsel issued Antidiscrimination Guidance in light of the DHS Supplemental Rule announced on March 21, 2008.

20. Developing Policy for Social Security “No Match” Regulation • Actual knowledge vs. constructive knowledge • Constructive knowledge that employee is unauthorized alien • Failure to complete/improper completion of I-9 • “Reckless and wanton disregard” of employment of unauthorized alien • Employee requests sponsorship • Social Security no match letter • Written notice from DHS

21. Social Security “No Match” Regulation (cont’d) • “Reasonable steps” to rebut constructive knowledge presumption (“safe harbor”) • Within 30 days: employer check/correct records and inform SSA/DHS • Within 90 days: if employer records correct, request employee confirmation • If employee corrects record, employer correct and inform SSA • If employee states employer records correct, employee must resolve discrepancy with SSA within 90 days

22. Social Security “No Match” Regulation (cont’d) • Within 93 days: if unresolved after 90 days, new I-9 must be completed by the 93rd day. • Employer cannot accept the following: • Any document referenced in written notice • Any document with disputed social security or alien number • Any receipt for replacement of such document • Employee must present a document with a photograph • If not, terminate

23. I-9 Compliance • Must complete for all employees • 1st day for employee / 3 days for employer • Originals or copies of documents? • Reverification of employees with expired work authorization • Maintain 3 years from date of hire or 1 year after employment ends, whichever is later • Dealing with suspect documents • Avoiding common I-9 mistakes • Audit I-9s / correct I-9s

24. Developing EmployerBest Practices • Explicit policy prohibiting use of undocumented workers • Communicate policy to staff • I-9 training • I-9 audits • Develop policy regarding contractors • Develop consistent I-9 compliance policies • Avoid national origin and citizenship discrimination

25. Employer Best Practices(cont’d) • Establish protocol for responding to social security mismatch letters • Develop strategy for ensuring legal workforce • Create Corporate Immigration Policy Statements • Terminate employees who knowingly accept counterfeit documents • Track expiration dates of foreign national employees • Terminate foreign national employees discovered to be without authorization to work

26. Choosing Whether to Participate in Voluntary Government Program • E-Verify • Checks social security number against national database • New photo screening tool • Voluntary program • Best means to verify employment eligibility electronically • Database imperfect • Rebuttable presumption of compliance • Significant obligations, including allowing ICE and SSA to visit based on Memorandum of Understanding

27. Memorandum Of Understanding • Main Employer Responsibilities • Comply with all I-9 requirements • Post notices • Agree to periodic visits by ICE and SSA for routine audits • Attach results to Form I-9 and retain for same time as form • Rebuttable presumption of compliance if confirmation is obtained • If continued employment after Final Non-Confirmation a rebuttable presumption of violation of INA § 274A(a)(1)(A) is created • If company participates in good faith ICE waives criminal and civil liability for some offenses relating to hiring unauthorized employees.

28. General Guidelines for E-Verify • Not a substitute for I-9 compliance • Does not provide protection against worksite enforcement • Cannot be used to pre-screen for discrimination • Can only be used to verify eligibility of newly hired employees • Queries must be conducted within 3 days after hire • You can leave the E-Verify program only after 30 days notice

29. Guidelines for E-Verify(cont’d) • What you need: • Information from Section 1 and 2 from the Form I-9 • Employees name • Date of Birth • Social Security Number • Citizenship Status employee attest to • A# or I-94 # if applicable • Expiration dates for identification and eligibility documents • Identification document provided from List “B” must contain a photograph

30. Results • Confirmation – GREEN LIGHT • Record the case verification number of Form I-9 or attach printout of result screen. • This ends the process - Obligation to re-verify remains for time limited authorizations. • Final Non-Confirmation – RED LIGHT • Record the case verification number of Form I-9 or attach printout of result screen • Review No-Match Q & A from guidance

31. Results • Tentative Non-Confirmation – Yellow Light • System cannot perform immediate match • NOT grounds for termination • Follow up steps: • Double check input date to ensure no errors (if errors are found run SSA query again) • Record case verification number • Inform employee of tentative non-confirmation

32. Results (cont’d) 4. Inform employee he/she has the right to contest information with SSA or DHS • If employee does not wish to contest information – YOU MUST TERMINATE EMPLOYMENT • If employee wishes to contest information – you must provide him with a referral letter to SSA or refer him to contact DHS. Employee has 8 Federal Working Days to resolve discrepancy with SSA and/or DHS. • On the date that is 10 Federal Working Days after the date of the referral you must query the system again.

33. Choosing Whether to Participate in Voluntary Government Program (cont’d) • ICE Mutual Agreement between Government and Employers (“IMAGE”)(www.ice.gov/partner/opaimage) • I-9 audit by ICE • Verify social security numbers of existing workforce • ICE training and education • Commit to ICE “best practices” • Establish “tip line” to ICE • Does not ensure against raid, investigation, fine or criminal action

34. Social Security NumberVerification Service (SSNVS) • Social Security Number Verification Service (SSNVS) is an online service that allows registered employers and third-party submitters to verify employee names and SSNs against SSA’s records for wage reporting purposes only. • This service cannot be used to verify employment eligibility.

35. Questions ?

36. For Further Information • Elise A. Fialkowski, Esq. • Tele: 215.825.8647 • Fax: 215.825.8699 • E-mail:efialkowski@klaskolaw.com • Theodore J. Murphy, Esq. • Tele: 215.825.8646 • Fax: 215.825.8699 • E-mail:tmurphy@klaskolaw.com