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I-9 E-Verify Immigration Compliance

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  1. OCAHO Reduces Penalties for Two Related Companies

    By: Bruce Buchanan, Sebelist Buchanan Law

    In a calendar year with few decisions, Office of Chief Administration Hearing Officer (OCAHO) issued its last one in U.S. v. Integrity Concrete/American Concrete, 13 OCAHO no. 1307 (2017). In this decision, OCAHO substantially reduced the penalties assessed against Integrity Concrete, Inc. and American Concrete, Inc., which essentially acted as joint employers. This decision only involves the amount of the penalties as Respondents agreed to the liability.

    Factual Scenario for Integity

    Integrity, located in San Diego, CA, was served with a Notice of Inspection (NOI) in January 2015. Thereafter, ICE served Notice of Suspect Documents on Integrity listing eight employees whose I-9 forms could not be verified as authorized to work. Integrity responded none of the eight employees were employed anymore.

    About seven months later, Integrity was served with a Notice of Intent to Fine (NIF), which charged the company with the failing to timely prepare I-9 forms for five employees, failing to ensure that three employees properly completed Section 1 of their I-9 forms, and failing to properly complete Section 2 or 3 of the I-9 forms for 16 employees. ICE assessed a fine of $24,684 based upon a baseline penalty of $935 and 5% enhancement for lack of good faith and seriousness of the violations.

    In Integrity’s answer, it challenged the penalties asserting it was a small employer, numbering 28 employees, which should account for a 5% statutory reduction in the penalty, bad faith should not have been found, and the penalties assessed would place an undue hardship on the company.

    Factual Scenario for American

    American, also located in San Diego, CA, was served with a Notice of Inspection (NOI) in January 2015. Later, American was also served with a Notice of Suspect Documents listing four employees whose I-9 forms could not be verified as authorized to work. American responded none of these employees were employed at its company. ICE assessed a fine of $24,684 based upon a baseline penalty of $935 and a 5% enhancement for lack of good faith and seriousness of the violations.

    ICE also served a separate NIF on American alleging it failed to timely prepare I-9 forms for 10 employees. ICE proposed a fine of $5,390 based on a baseline penalty of $440 plus 5% enhancements for lack of good faith, seriousness of the violations, and employment of three undocumented workers. American filed an Answer asserting it should have received 5% mitigation for each of these factors: small size of its workforce (48 employees), good faith, and the non-statutory factor of leniency toward small businesses.

    OCAHO’s Decision

    The first factor discussed was whether Integrity and American should receive 5% mitigation for being a small employer. ICE asserted the fact that both employers had small workforces, 48 and 28 employees, was inappropriate for determining whether they were small employers. ICE argued it should focus on gross sales and gross assets. The Administrative Law Judge (ALJ) for OCAHO disagreed and applied appropriate caselaw to find both to meet the definition of small employers; thus, they were entitled to the statutory 5% mitigating factor.

    Next the ALJ focused on whether Integrity and/or American should be assessed 5% enhancement for bad faith or 5% mitigation for good faith. ICE asserted three reasons for a finding of bad faith: Integrity backdated one I-9 form; both companies did not complete I-9 forms for some employees until after the NOIs issued; and their failure to present evidence that they utilize E-Verify.

    Although backdating alone is insufficient to support a finding of bad faith, the ALJ found several factors supported a finding of bad faith. However, the ALJ noted the use or non-use of E-Verify is not a factor which should be reviewed in determining good faith/bad faith.

    Concerning the employment of undocumented workers as an enhancement factor, the ALJ stated ICE failed to provide any evidence of their undocumented status. Rather, their enhancement was based on inclusion in the Notice of Suspect Documents. As the ALJ correctly pointed out, an allegation of undocumented status, which is essentially what placement on a Notice of Suspect Documents means, is not sufficient to prove undocumented status. Thus, no enhancement was added for this factor.

    Another issue involving Integrity was whether it established an inability to pay/hardship. The ALJ did not find such, despite a loss of over $600,000, because Integrity paid approximately $500,000 in salaries and benefits – much of which was paid to its shareholders.

    In determining the amount of the penalties, the ALJ was disturbed by the fact that $935 was the baseline penalty for Integrity while only $440 was the baseline penalty for American. Although the ALJ correctly noted the difference in the percentage of errors on the I-9 forms was the basis of the different baseline penalty, he found the companies should be assessed at approximately the same dollar amount and compliance rate alone is insufficient to justify wide variation. Thus, the ALJ assessed $400 baseline penalty for substantive paperwork violations and $500 for failure to prepare I-9 forms.

    Based on this analysis, Integrity was found to have committed five violations for failing to prepare and/or present I-9 forms. Each of these violations will be assessed at $500, with the enhancement factor for seriousness of the violations and mitigation factor for the small size of the business cancelling each other. Accordingly, Integrity is liable for $2,525 under Count I. Under Counts II and III, Integrity was liable for substantive violations for failure to properly complete three I-9 forms and 19 substantive paperwork violations, all assessed at $400 each. Therefore, Integrity is liable for $11,325.

    American was found liable for 11 substantive violations for failing to prepare and/or present I-9 forms. Each of these violations will be assessed at $500, which includes the $500 base fine, with the enhancement factor for seriousness of the violations and mitigation factor for the small size of the business cancelling each other. Accordingly, American is assessed a total civil penalty of $5,500.

    Conclusion

    OCAHO may have slowed down on adjudication of cases but they will be back to speed once they get their allotment of ALJs. In the meantime, now is a great time to conduct an internal I-9 audit under the supervision of an experienced immigration compliance attorney. To find out more about internal I-9 audits as well as other employer immigration compliance issues, I invite you to read The I-9 and E-Verify Handbook, a book that I co-authored with Greg Siskind, and is available at http://www.amazon.com/dp/0997083379.
  2. Pre-Population: Ever-Changing Positions from Immigration-Related Agencies

    By: Bruce Buchanan, Sebelist Buchanan Law

    The immigration-related agencies’ positions on the pre-population of data in Section 1 of the I-9 form is everchanging. At about the time of our publication of the book, The I-9 and E-Verify Handbook, Bruce Buchanan and Greg Siskind, 2d ed. (2017), the USCIS altered its position again.

    The USCIS added the following in I-9 Central, Section 1, Questions & Answers:

    Question: Can Section 1 of Form I-9 be auto-populated by an electronic system that collects information during the on-boarding process for a new hire if the employee is required to verify that the information is correct and can make corrections or add information if necessary?

    Answer: DHS regulations require that the employee completes Section 1 of Form I-9. Employers can offer employees electronic tools to facilitate the Section 1 completion process, as long as this regulatory requirement and the regulatory requirements for the electronic generation of Form I-9 continue to be met.

    This answer is contrary to the position that USCIS articulated in the E-Verify newsletter, November 2016, which the book quoted as follows:

    USCIS stated Section 1 of Form I-9 could not be pre-populated. Pre-population involves the electronic inclusion of data about the employee in Section 1 by Form I-9 software programs without the employee having to write the information in Section 1.

    See Chapter 2, Question 2.12, p. 23-24.

    Immigration and Customs Enforcement (ICE) and OSC (now renamed the Immigrant and Employee Rights Section (IER) of the U.S. Department of Justice) have not changed their positions which were discussed on p. 24 of The I-9 and E-Verify Handbook. Thus, ICE holds no official position on the pre-population of Section 1 by electronic Form I-9 software programs. This is a change in past policy in which ICE stated pre-population could not be done by employers. On the other hand, in August 2013, the OSC stated that it discouraged the practice of pre-population because “it increases the likelihood of including inaccurate or outdated information.”

    I invite anybody who has the book - The I-9 and E-Verify Handbook, which is available at http://www.amazon.com/dp/0997083379, to alert me of any substantive changes that have been made in employer immigration compliance since the publication of the book. As we know, immigration law is everchanging and I want to keep the book up to date. I would like to thank Dave Fowler of Worksite Compliance Services for pointing out the change related to pre-population.
  3. ICE Continues its Inspections of California Employers

    By: Bruce Buchanan, Sebelist Buchanan Law

    As I have discussed in a recent blog entry (http://blogs.ilw.com/entry.php?10373...ilent-Raids%94), Immigration and Customs Enforcement (ICE) is seemingly targeting California employers for inspections of their I-9 forms. In the past week, Bee Sweet Citrus in Fowler, California and about seven other Fresco area employers have received ICE visits for the purposes of subpoenaing their I-9 forms and other paperwork. In previous weeks, ICE targeted 77 employers in the San Francisco Bay Area and Sacramento.

    ICE spokesman, James Schwab, said the work site enforcement actions are nothing new and remain a priority of Homeland Security Investigations, a part of ICE, to ensure employers are in compliance with the law. However, this statement seems contradictory to ICE acting Director Homan’s statement that ICE was increasing their inspections by 400 to 500%.

    As many of my readers know, once an employer receives a Notice of Inspection/subpoena, it has 3 days to produce its I-9 forms to ICE for their inspection. In the inspection (also referred as an audit), ICE reviews the I-9 forms to determine whether all employees are legally authorized to work and whether there are substantive paperwork violations on the I-9 forms. If undocumented workers are employed, ICE may return to the employer and detain the undocumented workers. Alternatively, ICE may issue a Notice of Suspect Documents to the employer stating which employees do not have valid work authorization. If after the employer gives its employees an opportunity to provide valid documentation (“newer and better documentation”), the employees fail to provide such, the employer must discharge those employees. If the employer is knowingly employing undocumented workers, it faces penalties of up to $4473 per employee for first offenses. Additionally, substantive paperwork violations on I-9 forms are penalized at $224 to $2236 per I-9 form.

    At Bee Sweet Citrus, at least 40 workers quit after ICE delivered the NOI/subpoena, seemingly because they knew they were undocumented and were afraid of being detained by ICE. Jim Marderosion, president of Bee Sweet Citrus, said his workers were aware the ICE agents were coming and that was enough for some employees not to return to work. It’s unclear how the workers knew of the inspection as normally ICE does not provide advance notice.

    Marderosian said “One woman who has worked for me for nearly 20 years came up to me, gave me a hug and told me that she had to leave; she couldn’t take a chance.” Marderosian also stated “What good does it do to make these workers lose their jobs. They will have to find work somewhere. Some way or another they are going to have to feed their families.” This story was first reported by Robert Rodriguez of The Tribune, http://www.sanluisobispo.com.

    To learn more about employer immigration compliance and steps you can take to prevent I-9 violations and hiring undocumented workers, I invite you to read The I-9 and E-Verify Handbook, a book that I co-authored with Greg Siskind, which is available at http://www.amazon.com/dp/0997083379.
  4. Cost of Immigration Violations Continue to Rise

    By: Bruce Buchanan, Sebelist Buchanan Law

    Effective January 20, 2018, the civil penalties for a variety of immigration-related violations increased dues to an adjustment for inflation. Below is a chart setting forth the old and new amounts:

    Type of Violation Old Amounts New Amounts
    I-9 substantive violation $220 - $2191 $224 - $2236
    Knowingly employing undocumented worker $548 - $4384 $559 - $4473
    Unfair Documentary Practice $181 - $1811 $185 - $1848
    Immigration-Related Discrimination $452 - $3621 $461 - $3695

    These increases are another reason to conduct an internal audit of your I-9 forms. Through such, an employer can remedy or mitigate many violations before Immigration and Customs Enforcement (ICE) or the Immigrations and Employees Rights Section (IER) discovers them. To learn more about employer immigration compliance and steps you can take to prevent I-9 violations and hiring undocumented workers, I invite you to read The I-9 and E-Verify Handbook, a book that I co-authored with Greg Siskind, which is available at http://www.amazon.com/dp/0997083379.
  5. ICE Targeting California for More “Silent Raids”

    By: Bruce Buchanan, Sebelist Buchanan Law


    On the heels of Immigration and Customs Enforcement’s (ICE) worksite enforcement actions/inspections against 97 7-Eleven convenience stores, ICE announced it has conducted I-9 inspections of 77 employers in the San Francisco and Sacramento areas. ICE did not identify any of the businesses its agents visited in the Bay Area and the Sacramento region. However, just the fact that ICE served subpoenas on so many employers demanding their I-9 forms and then announced it to the media, demonstrates ICE is trying to put the fear of government action in the minds of every employer, especially in California.

    When ICE conducts an I-9 inspection, their agents show up at employer locations and serve a subpoena and Notice of Inspection (NOI) demanding the employer produce the I-9 forms of current employees, and often former employees, within three days of service. Often, these inspections are referred to as “silent raids” because they can have the same effect as a raid – loss of employees through ICE detention, terminations or quick abandonment of jobs.

    According to James Schwab, a spokesman for ICE, their operation is part of a strategy that is “focused on protecting jobs for U.S. citizens and others who are lawfully employed, eliminating unfair competitive advantages for companies that hire an illegal workforce, and strengthening public safety and national security.”

    It is interesting that ICE chose California for these actions as ICE and the Trump administration are involved in an assault on California due to their recent legislation declaring California as a sanctuary state. Thomas D. Homan, acting director of ICE, has criticized California for state and local efforts to protect undocumented immigrants and limit law enforcement’s ability to cooperate with immigration officials. Homan recently stated “We’ve got to take these sanctuary cities on. We’ve got to take them to court, and we’ve got to start charging some of these politicians with crimes.”

    California recently enacted legislation requiring employers notify their workers of such an ICE audit and provide them with the results. The law also mandates that employers ask ICE to obtain a judicial warrant in some situations though not for NOIs. California Attorney General Xavier Becerra recently held a press conference where he warned California employers of the consequences of violating this legislation. Thus, many California employers are perplexed as to how to be in abeyance of both federal and state immigration laws.

    Angelo Paparelli, a prominent immigration attorney with Seyfarth Shaw, stated “Serving 77 notices of inspection on different employers in the last three days within a single area of responsibility, in this case, San Francisco, appears unprecedented.”

    After the businesses comply with the subpoena/NOI, ICE auditors will carefully review the I-9 forms to determine whether undocumented workers are employed at the business and whether the I-9 forms have substantive errors, which could cost $224 to $2236 per I-9 form. If undocumented workers are employed, ICE may return to the employer and detain the undocumented workers. Alternatively, ICE may issue a Notice of Suspect Documents to the employer stating which employees do not have valid work authorization. If after the employer gives its employees an opportunity to provide valid documentation (“newer and better documentation”), the employees fail to provide such, the employer must discharge those employees or face fines of up to $4473 per employee.

    I will keep you apprised on further developments of these “silent raids” and the 7-Eleven ones. If you are concerned about your I-9 forms and the legal status of your employees, I urge you to retain an immigration attorney trained in worksite enforcement, who can spearhead an internal I-9 audit.

    If you want a full discussion of internal I-9 audits and other important immigration compliance issues, I recommend you read The I-9 and E-Verify Handbook, a book I co-authored with Greg Siskind, which is available at http://www.amazon.com/dp/0997083379.
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