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I-9 E-Verify Immigration Compliance


  1. Negotiating in an ICE Inspection

    By Bruce Buchanan, Siskind Susser

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    At a recent FBA Conference in Chicago on Worksite Enforcement, there was a panel discussion on negotiating with Immigration and Customs Enforcement (ICE) during an inspection – hosted by attorneys Sharon Mehlman, Marcine Seid, and Eileen Momblanco. In this article, I will elaborate upon some of the talking points from that discussion and other negotiation strategies.
    During an investigation by ICE, after receipt of a Notice of Inspection (NOI)/subpoena, there are several opportunities to negotiate with the agency.

    Negotiating Point #1 - Subpoena
    The first negotiable is the date by which the I-9 forms must be provided. The NOI states the I-9 forms and other subpoenaed documents must be provided to ICE within three business days of service of the NOI. Often times, however, a short extension of up to 10 days can be obtained if counsel contacts the ICE officer or auditor on the case and provides an appropriate reason for the extension (e.g. small HR staff; thousands of I-9 forms, counsel was just hired, etcetera). The decision to grant an extension is discretionary, and some ICE offices refuse to grant any extensions.

    Negotiating Point #2 – Notice of Suspect Documents
    If a company receives a Notice of Suspect Documents (NSD), after supplying the I-9 forms, it used to be common practice to negotiate what was a “reasonable” period to resolve the work status of those on the NSD. Now, all NSDs state the employer has 10 days to do so. In a liaison meeting with the American Immigration Lawyers’ Association (AILA), ICE stated that the 10 days is not a national policy although many regions treat it as such. However, in other regions this 10-day period is negotiable if the employer can show the impact that the loss of unauthorized employees will have on U.S. citizen employees and/or the community (e.g. the facility will be forced to shut down due to a lack of employees).

    Negotiating Point #3 – Notice to Employees
    On some occasions, ICE will negotiate a “roll-out schedule” for notification of employees listed on the NSD. After receipt of the NSD, the employer notifies those employees that ICE has determined their work authorization is invalid, and requests documentation from the employee to rebut ICE’s finding. With a roll-out schedule, the employer does not have to notify all employees on the NSD at the same time.

    Negotiating Point #4 – Proposed Penalty Amount
    The proposed penalty amount set forth in the Notice of Intent to Fine (NIF) is the most important point to negotiate. Before starting negotiations, counsel must inform ICE in writing that they wish to have a hearing before the Office of the Chief Administrative Hearing Officer (OCAHO). If counsel fails to do so, then the NIF will become final in 30 days.
    Most ICE attorneys are amenable to negotiating a reduction in the proposed penalties. There are a number of arguments that counsel can make for a reduction, such as:

    • ICE listed technical error as a substantive error;
    • ICE incorrectly applied the five mitigating/aggravating factors;
    • ICE counted an employee twice in the NIF;
    • for timeliness violations – beyond the five year statute of limitations;
    • the company was not required to have I-9 form because the individual is an owner with substantial control or was hired on November 6, 1986 or beforehand;
    • math errors by ICE; and
    • for poor financial condition of the company established by financial records (this is a powerful tool for reducing the amount of the penalty and lengthening the time to pay the penalties – sometimes up to five years).

    Negotiating Point #5 – Press Release

    The last negotiable item is the press release and whether ICE is going to publicize the settlement of the matter. However, in many parts of the United States, ICE never issues a press release for settlements.

    It is important to engage immigration compliance counsel as soon as a company is served with an NOI. As shown above, legal counsel can help to lessen an employer’s burden, avoid common pitfalls and negotiate at numerous points during the ICE inspection process.
  2. OCAHO Slashes Company’s Alleged I-9 Violations

    By Bruce E. Buchanan, Siskind Susser

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    OCAHO surprised a lot of people this month when it dismissed 337 out of 381 alleged I-9 violations in U.S. v. Foothill Packing. In doing so, Immigration and Customs Enforcement’s (ICE) proposed penalties were reduced by $149,000.

    Foothill is a fruit and vegetable packing company with an office in Somerton, Arizona. In March 2012, ICE served the company with a Notice of Inspection and subpoena. It is undisputed that the original auditor for the inspection only requested the I-9 forms without documentation. A later ICE auditor testified he requested supporting documentation. Interestingly, neither party produced the subpoena to OCAHO.

    Foothill primarily hired its employees through the H-2A nonimmigrant temporary agricultural visa program and obtained the employees’ Mexican passports, which included their I-94 and H-2A visa. Foothill management repeatedly offered these documents to ICE auditors, but ICE refused them. At the end of the investigation, ICE cited Foothill with 337 violations for failing to record the pertinent foreign passport information in Section 2 of the I-9 forms or present copies of the passports.

    If Foothill had provided the I-94s and H-2A visas, ICE said these violations would have been treated as technical violations. However, ICE noted that copying these documents still did not relieve Foothill from its responsibility to fully complete the I-9 forms. Foothill asserted that, according to the Virtue Memorandum, the “failure to enter the foreign passport information is a technical violation if a copy of the document is presented at inspection”. OCAHO found that the Virtue Memorandum actually states the omission of a document number or expiration date in Section 2 is a technical violation, if a legible copy of the document is retained and presented. Despite this finding by OCAHO, it determined Foothill should not be found in violation for these I-9s because of the ICE auditor’s statements that supporting documentation was not needed.

    OCAHO further found that Foothill made “diligent efforts at the outset of the investigation to provide copies of the Mexican passports” and cannot be liable for failure to present documents that the government refused to accept. 337 of the alleged violations were dismissed.

    Knowingly Employing an Undocumented Worker

    On a separate issue, OCAHO found Foothill knowingly employed an unauthorized worker based upon the fact the employee was hired in June 2010 but presented an employment authorization card which expired on August 5, 2003. Because Foothill chose to accept an expired document without making further inquiry, the company had actual, or at least, constructive knowledge of the employee’s unauthorized status. OCAHO increased ICE’s proposed penalty of $375 to $2,200 (which is still below the maximum of $3,200 for a first offense).

    Calculation of Fines

    As to the remaining alleged violations, OCAHO found Foothill committed 44 substantive violations, ICE sought a penalty of $440 per violation which OCAHO found to be in the midrange of permissible penalties. Thus, OCAHO assessed a penalty of $19,360 for the 44 substantive violations. Together with the $2,200 penalty for knowingly hiring one unauthorized worker, Foothill’s total penalty came to $21,560.

    The Takeaway

    This case provides a unique example where an employer was able to seize on ICE auditors’ directions to substantially reduce its liability. It highlights the importance of compliance attorneys discussing with their client any conversations they may have had with ICE when the subpoena was served.

    A copy of the OCAHO decision is available here.
    Cite as United States v. Foothill Packing, Inc., 11 OCAHO no. 1240 (2015).
  3. Arizona Businessman and Managers Sentenced for Immigration Violations

    By Bruce Buchanan, Siskind Susser

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    The former owner of Danny’s Family Car Wash and more than a dozen of the company’s former managers and supervisors, were sentenced in federal court in Arizona last month. The defendants pleaded guilty to their roles in a multi-year corporate scheme involving identity theft to employ undocumented immigrants.

    The investigation into the company was led by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and resulted in the arrest of more than 30 suspects including operators, managers, and employees connected with Danny’s Family Car Wash.

    Beginning in April 2011, the car wash was audited by ICE HSI agents and forced to terminate over 900 employees after the audit found employees had presented fraudulent, insufficient, or ineligible documents at the time of their initial hire. The company attempted to replace the 900 employees with individuals who were authorized to work, but according to ICE those legal replacements were “too expensive” and the car wash’s owner, Danny Hendon, instructed his managers to “bring back” the old employees.

    As a result, Danny’s Family Car Wash was found to have engaged in a multi-year, company-wide scheme to rehire undocumented immigrants using stolen identities in order to pass E-Verify checks. The scheme continued until August 2013, when ICE HSI special agents executed search warrants at the car wash’s corporate headquarters and at various worksite locations. Over 230 unauthorized aliens were found working at the car wash’s locations on the day of the search.

    Danny’s Family Carwash owner, Danny Hendon, was sentenced to 12 months in prison and one year of home confinement. The corporate entities that composed the car wash chain forfeited bank accounts totaling $156,295.77, and Hendon agreed to divest himself of any future ownership, managerial or profit-sharing interest in the organization. The other defendants received sentences ranging from probation to three months in prison.

    This case is reminiscent of the Grand America Hotel and Waste Disposal cases in which company managers rehired unauthorized employees following compliance audits.

    A copy of the press release from ICE HSI can be found here.

    Cite as United States v. Danny’s Management Services LLC, et al., No. 13-CR-01143-PHX-NVW (D. Ariz.)
  4. Hotel Chain Pays $1.95 Million for Undocumented Workers

    By Bruce Buchanan, Siskind Susser

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    Grand America Hotels and Resorts, a subsidiary of the Sinclair Services Company, will forfeit $1.95 million for hiring unauthorized workers pursuant to a non-prosecution agreement between the company, the U.S. Attorney for the District of Utah and U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).

    In reaching this agreement, the company will avoid criminal prosecution in exchange for its full cooperation and remedial action in the wake of HSI's investigation into the hiring practices at its hotel and resort properties in Arizona, California, Idaho, Wyoming and Utah.

    According to facts set forth in the agreement, several lower-level Grand America employees and mid-level managers conspired to re-hire unauthorized workers despite an ICE audit of I-9 forms that began in September 2010. A year later, ICE-HSI issued a Notice of Suspect Documents to Grand America stating that 133 employees were not authorized to work in the United States. After the Notice, the employees could not produce documentation that they were authorized to work. The company was issued a warning notice and Grand America informed HSI that it had terminated the employees.

    However, HSI later discovered that the conspirators created three temporary employment agencies or “shell companies” between August 2011 and October 2011, to re-hire 43 of the unauthorized workers. The agreement says most of the workers returned to work using different names and fraudulent identity documents.

    In addition to forfeiting $1.95 million to the Department of Homeland Security (DHS), Grand America will be required to take substantial remedial measures, which could cost up to $500,000 to implement. Such measures include: adopting new corporate policies to comply with immigration law; incorporating immigration law compliance clauses into the company’s labor service contracts; re-training human resources employees on I-9 compliance procedures; and agreeing to continue using E-Verify in the hiring of new employees. Grand America also agreed to retain immigration counsel to advise the company regarding hiring and immigration procedures.

    Grand America avoided criminal prosecution and fully cooperated with HSI’s investigation. Prosecutors said the company handed over all incriminating evidence it obtained through its own internal investigation, and fired the managers who were involved in the conspiracy. The government will seek to prosecute the conspirators separately.

    This news is a reminder to employers of the wealth of remedies available to ICE-HSI for immigration violations.

    Updated 09-16-2014 at 01:30 PM by BBuchanan

  5. ICE Fined 14 Mass. Employers for I-9 Violations in FY 2013; by Bruce Buchanan

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    Immigration and Customs Enforcement (ICE) has provided a rare opportunity to see the number of Notices of Inspection (NOIs) in a particular state and the amount of penalties for various companies. Several years ago, ICE stopped producing national reports on the names of companies fined and the fine amounts.

    According to a new report from the Boston field office, Homeland Security Investigations (HSI) fined 14 Massachusetts employers over $175,000 in FY 2013 for I-9 violations discovered during employer inspections. The largest fine was $38,491 while the smallest was $1,716. The chart below breaks down the fines by company, industry, city and amount:

    Company Name
    Lighthouse Masonry Construction New Bedford $22,500
    Pureview LLC Service Chelsea $30,000
    GM Employment Services, LLC Service Brockton $6,350
    Calamari's III d/b/a Cal's Wood-Fired Grill & Bar Retail Trade West Springfield $24,000
    Today's Temps, Inc. Service Lawrence $1,716
    Precision Cleaning Co. Service East Boston $8,360
    Demoulas Super Markets Retail Trade Ashland $38,491
    Cruz Environmental Services Construction Lawrence $7,480
    Green Stamp Corp. Construction Waltham $2,415
    Top Shelf Retail Trade Boston $2,566
    Joymark, Inc. Service Boston $10,000
    Corolla Roofing Construction Winthrop $7,500
    Mota Construction Corp Construction Hopedale $6,591
    Framing Specialist Group Construction Hopedale $7,152

    Of the 14 companies fined, six were in the construction industry, five in the service industry, and three in the retail trade industry. The construction and service industries usually have the highest rate of NOIs.

    The number of ICE inspections in Massachusetts has more than tripled since 2009 – from just 17 to a FY 2013 total of 56:

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    Interestingly, and despite the increased number of employer inspections by ICE, the fine amounts ordered against Massachusetts employers decreased nearly 50% between 2012 and 2013:

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    Based on these statistics, employers would still be wise to take I-9 compliance seriously by having an internal audit of their I-9 forms conducted/supervised by an immigration compliance attorney and having an I-9 Compliance Policy in place so that all relevant personnel are aware of their duties and responsibilities.

    Click here for a copy of the ICE HSI Boston press release.

    Updated 04-16-2014 at 12:58 PM by BBuchanan

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