All employers in the U.S. are required by federal law to complete a Form I-9 for every individual hired after November 6, 1986 who will perform work in the United States. The purpose of the I-9 is to evidence that the employees are authorized to work in the United States.
Ordinarily, I-9 forms are not submitted to the government (except when requested by an agency such as U.S. Immigration and Customs Enforcement (ICE).) Instead, employers are required to retain the I-9s on file for all current employees and for former employees during the required retention period (three years from the date of hire, or one year from the date of termination, whichever comes later). The government may, however, choose to inspect the employer's I-9 files, as discussed in this article.
Anatomy of an ICE Inspection
I-9 errors represent potential liability only if and when a government agency decides to launch an investigation. ICE initiates the administrative inspection process by serving a Notice of Inspection (NOI) upon an employer compelling the production of Forms I-9. ICE typically will allow three business days for an employer to present the Forms I-9. ICE will generally also request that the employer provide supporting documentation, such as a copy of the payroll, list of current employees, Articles of Incorporation, and business licenses. After receiving the requested documents, ICE agents or auditors then conduct an inspection of the I-9s for compliance.
Following their analysis, ICE will notify the audited party, in writing, of the results of the inspection. If ICE identifies violations or potential violations, it issues one or more of the following:
- a Notice of Suspect Documents
- Notice of Technical or Procedural Failures
- Warning Notice
- Compliance Letter, and/or
- a Notice of Intent to Fine (NIF).
If You Receive a "Notice of Suspect Documents"
The first notice that employers typically receive after submitting the I-9s to ICE is the Notice of Suspect Documents, which lists employees deemed by ICE to lack legal authorization to work in the United States. The notice typically indicates that the employer will be considered by ICE to be acting reasonably if, within ten days, it terminates the employment of these individuals or provides evidence that the individuals are authorized to work. Depending on the circumstances, an employer may be able to negotiate with ICE to obtain additional time.
If You Receive a "Notice of Technical or Procedural Failures"
The second notice you may get is the Notice of Technical or Procedural Failures. Despite the fact that this notice indicates a failure to comply with the I-9 requirements, it is sometimes considered to be “good news,” as it suggests that ICE does not intend to charge the employer with “bad faith” failures. Instead, it gives the employer an opportunity to correct certain errors and to avoid fines for those that are ultimately corrected.
If You Receive Warning Notices and Notices of Intent to Fine
The next communication from ICE typically takes one of three forms: a Compliance Letter, Warning Notice, or Notice of Intent to Fine.
A Compliance Letter is congratulatory and indicates that no (or very few) substantive violations were encountered during the inspection. A Warning Notice lists substantive violations but indicates that no fines are warranted; this letter orders the employer to cease the violations. If ICE later returns for a follow-up inspection and finds the same violations, fines are likely. A Notice of Intent to Fine lists substantive violations and sets a fine amount for each. Following such a notice, the employer has an opportunity to negotiate a settlement or litigate.
Potential Fines and Other Consequences
An ICE inspection can result in the loss of employees who are not authorized to work. Depending on the violations found during the investigation and ICE’s desire to publicize them, the inspection can result in damage to a business's reputation and loss of investors. If particularly serious violations are uncovered, the investigation may result in criminal prosecution of individuals engaged in the knowing hire of unauthorized workers, document fraud, harboring, and similar “bad acts.”
Most ICE inspections do not result in criminal prosecution or press releases. Instead, most end with a Warning Notice or with the payment of a negotiated civil fine amount. ICE will not agree to confidentiality as a term of settlement, but ICE typically does not publicize the results of an investigation unless particularly serious violations are uncovered.
Civil fines range from $110 to $1,100 per employee, depending on the number of violations. The base fine amount may go up or down by as much as 25% depending on mitigating and aggravating factors such as the size of the business, the seriousness of violations, and the number of unauthorized workers discovered during the investigation.
The best way to avoid fines is to provide I-9 training to all of those representatives of your company or organization that will be involved in the I-9 process. Consider putting a strong immigration compliance policy into place. For more hints and tricks, see "Top I-9 Mistakes to Avoid."