The Immigration Reform and Control Act of 1986 (IRCA) legally mandates that U.S. employers verify the employment eligibility status of newly-hired employees. IRCA made it unlawful for employers to knowingly hire or continue to employ unauthorized workers. In response to the law, the Immigration and Naturalization Service (INS), now an integrated component of the Department of Homeland Security (DHS), created Form I-9 and mandated its accurate and timely completion by all U.S. employers and their employees.

Form I-9 is a three-part document

The law requires that the employee complete Section 1 at the time of hire or when the employee begins work. Section 1 may also be completed at the application stage, as long as the practice does not discriminate. The employer must complete Section 2 within three business days of hire and certify that the employee's documents of identity and work authorization appear to be genuine and belong to the employee. Section 3 is completed by the employer when it is necessary to update or re-verify an employee's work authorization document(s).

While most employers attempt to fully comply with IRCA, many routinely and unknowingly accept I-9 Forms with fraudulent supporting documents. The passage of the Sarbanes-Oxley Act and increased public exposure of troubled companies has heightened employers' awareness of legal compliance issues to new levels. It is prompting many to decide that it's in their best interest to retain an independent, non-governmental entity to conduct I-9 audits and electronic I9 creation as a preventative best practice.

The Risks of Non-Compliance

Employers who fail to fully comply with IRCA face significant legal, financial and public relations risks. Non-compliance, whether intentional or simply caused by oversight, has severe consequences imposed by DHS, as well as the potential of a corporate image tarnished by negative publicity. Unfortunately, most employers are unaware that they have a problem with Form I-9 employment verification requirements until they are audited by governmental authorities. By that time, it is generally too late to undo the damage.

The following is a partial list of federally mandated fines:

  • For employers who fail to properly complete, retain, or make Form I-9 available for inspection, fines range from $220 to $2,191 per individual I-9.
  • For employers who knowingly hire or knowingly continue to employ unauthorized workers, civil penalties range from $250 to $11,000 per violation.
  • For employers engaging in a pattern or practice of knowingly hiring or continuing to employ unauthorized workers, fines can be as much as $3,000 per employee and/or 6 months of imprisonment.