Written by attorney Nicklaus James Misiti

I-9 Audits and Immigration Law

I-9 audits have replaced the immigration "raids" of years past as the modern day method to curtail the hiring of illegal and undocumented workers. Typically raids went after the worker and placed them in deportation proceedings, however, an I-9 audit targets the employer and can result in heavy fines and possible criminal penalties.

The frequency of I-9 audits have and will continue to increase. ICE has already issued more than $2.5 million in fines to employers across the nation this year for knowingly hiring illegal immigrants, and nearly 48 employers have been arrested on criminal charges. ICE issued nearly $7 million in fines and arrested 196 employers in 2010. ICE feels punishing the employer is the most effective deterrent to illegal immigration and has plans to continue and expand I-9 audits for at least the next few years.

Any business that typically relies on a foreign born work force should be concerned, even minor violations can lead to penalties and C.E.O.'s and managers will be held responsible for the hiring decisions of their employees, so there is no defense in not knowing.

What is an I-9 Audit?

The first step in an Immigration and Customs Enforcement ("ICE") audit is the service of a Notice of Inspection demanding the employer produce the I-9's for its employees within 3 days. ICE has subpoena power and typically a company will be compelled to produce a copy of the payroll, list of current employees, Articles of Incorporation, business licenses, and social security no-match letters (if any).

ICE forensic auditors will review the I-9s for substantive errors (those which cannot be cured) or paperwork violations (those which can be cured). ICE will then issue a Notice of Technical Deficiencies, highlighting those I-9s which must be corrected within 10 days to avoid fines.. If violations are found during an audit, ICE will then issue a Notice of Intent to Fine. I-9 violations may also lead to criminal prosecutions

What are the penalties?

In determining penalty amounts, ICE considers five factors: the size of the business, good faith effort to comply, seriousness of the violation, whether the violation involved unauthorized workers, and a history of previous violations.

In this context any employer found to be knowingly and willfully employing unauthorized workers will be subject to punitive civil and criminal sanctions. For example, IFCO Systems North America did not comply with the requirements to verify employment eligibility and paid a civil fine amounting to $20.7 million. Criminal charges were also imposed because numerous IFCO managers entered a plea of guilty to the criminal allegations resulting from the failure to complete the I-9 verification form.

Similarly, Abercrombie & Fitch clothing stores were recently fined over $1 million dollars due to I-9 violations. Additionally, Chipotle eateries had to fire 50 employees resulting from deficient I-9 forms. Small businesses cannot escape I-9 laws, in early 2011 a local restaurant in Arizona was fined for violating Form I-9 with 4 of its employees.

I-9 sanctions can be severe, for each incomplete or erroneous I-9 Form, the penalties will range from $110 to $1,100 and this extends to common mistakes and/or clerical errors. Examples of such mistakes can be as simple as missing dates or signatures. Fines may also be imposed for the improper maintenance and storage of I-9 Forms and may be between $110 and $3,000 per violation. More extreme fines cannot be levied, once it has been determined that an employee is an unauthorized worker, continued violations regarding these employees may result in a fines ranging from $250 to $11,000 per violation. In addition to these monetary fines, prison terms may also be imposed for serious violators. 2010 was a record-breaking year for ICE's issuance of fines to companies of all sizes and they are well on their way to breaking that record in 2011.

What can a company do to protect itself from an I-9 audit?

There are a number of steps an employer can take to limit the risk involved with a potential I-9 audit. An employer should develop a written compliance policy and should distribute it to and train its employees on this policy. Second, the employer should consider changes to its corporate culture. For example, if you are an employer that has previously relied on undocumented workers without incident you need to consider times have changed and you are now taking a risk and may be seriously punished for this. Although, it may cost more in immigration attorneys' fees or payroll in the short term, it may be advantageous to consider an H-2A or H-2B programs. This may be a burdensome and bureaucratic process but at least at the end of the day you will know you will have employees when you need them and won't be subject to large fines and potential criminal sanctions. Moreover, since you are doing everything legally you will be less likely to be audited. Common causes for audits occur when an illegal immigrant is picked up and placed in removal proceedings. Often they mistakenly think that if they turn in their employer they may get a more favorable decision. Similarly, a disgruntled worker may report his employer. The third and final step to protect your business from an I-9 audit is to simply conduct periodic I-9 audits yourself. For this it is often advantageous to hire an outside entity, such as an immigration attorney, to periodically do this for you. This is because they are more likely to catch any mistakes you may feel are correct practices. Practices you may feel are convenient and common sense often are not according to the legal system. When the government is involved you want someone who thinks in terms of legal verse illegal, not someone who thinks in terms of convenience and common sense.

In sum, whether you think ICE audits are an effective deterrent to illegal immigration or just another method by which the government is burdening business, I-9 audits are here to stay. A successful business person will realize this and will do everything they can to minimize any risk involved.

Additional resources provided by the author

Nicklaus Misiti is Chief Attorney and C.E.O. of Misiti Global, PLLC. His firm is experienced in all facets of immigration law. For more information or to schedule a free consultation feel free to contact his firm at 212 537 4407

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