DHS Rescinds No-Match/Safe Harbor Rule But No-Match Letters Remain Evidence of Constructive Knowledge of Unauthorized Employment and Form I-9 Sanctions

Form I-9 Violations: Rescinds No-Match/Safe Harbor Rule--Remain Evidence of Employer Constructive Knowledge of Unauthorized Employment 


Though ICE may not continue to base investigations on SSA No-Match Letters, employer action following up after receiving an Social Security Administration (SSA) No-Match Letter may be evidence of employer constructive knowledge that an employee is not authorized to work.


Employers annually send the SSA millions of earnings reports (Forms W-2) in which the combination of employee name and social security number (SSN) does not match SSA records. In some of these cases, the SSA sends the employer an employer-correction request, commonly referred to as a no-match letter, that informs the employer of the mismatch. While there can be many causes for a no-match, including clerical error and name changes, one potential cause may be the submission of information for an alien who is not authorized to work in the U.S. and who may be using a false SSN or an SSN assigned to someone else.


Recently DHS rescinded its No-Match Safe Harbor Rule.  Despite DHS' rescission of the no-match safe harbor rule, employers are advised to heed the following language in the preamble to the final rule:


"DHS has not changed its position as to the merits of the 2007 and 2008 rules ... . Receipt of a No-Match letter, when considered with other probative evidence, is a factor that may be considered in the totality of the circumstances and may in certain situations support a finding of “constructive knowledge” [that an employee is not authorized to work in the U.S.]. 


A reasonable employer would be prudent, upon receipt of a No-Match letter, to check their own records for errors, inform the employee of the no-match letter, and ask the employee to review the information. Employers would be prudent also to allow employees a reasonable period of time to resolve the no-match with SSA. ... [R]eceipt of a No-Match letter and an employer's response to a No-Match letter, in the totality of the circumstances, may be used as evidence of a violation of the employment restrictions of the Immigration and Nationality Act. ... Employers remain liable where the totality of the circumstances establishes constructive knowledge that the employer knowingly hired or continued to employ unauthorized workers."

DHS/ICE enforcement of I-9 and employer sanctions laws now targets employers through on-site investigations and administrative or "desktop" audits. 

Employer failure to verify employment eligibility and properly complete and retain I-9 Forms subjects the company to stiff criminal and civil liabilities, including imprisonment, asset forfeiture, and treble damages in RICO (Racketeer Influenced and Corrupt Organization) lawsuits by competitors. Executives, officers, managers, supervisors and key employees, as well as accountants are personally liable for civil and criminal penalties for I-9 related errors and unlawful employment eligibility verification (EEV) practices.

I-9 compliance (and E-verify for registered employers) require that employers verify all workers’ employment eligibility, or work authorization. Persons not authorized for employment, whether documented foreign nationals (or "illegal immigrants") generally do not have work authorization. The I-9 laws and the employment eligibility verification process restrict employment of illegal or undocumented immigrants and employment of persons who are not "employment authorized".

Employer liability extends to circumstantial evidence and “constructive knowledge”.
  It is unlawful to knowingly hire or continue to employ unauthorized workers. This I-9 process mandates accurate and timely completion of the Form I-9 by all U.S. employers and their employees.

"Knowingly hire" includes "constructive knowledge". The requisite employer's knowledge may be constructive knowledge when it may be fairly inferred through notice of certain facts which through exercise of reasonable care would lead a person to know about; or the employer deliberately fails to investigate such facts.

Employer constructive knowledge extends to its subcontractors' and independent contractors' I-9 compliance.

Goulder Immigration Law Firm assists employers with Form I-9 consulting, including I-9 and employer sanctions compliance training, developing a company I-9 and employer sanctions compliance manual, and employment eligibility compliance auditing services.  Written I-9 compliance policies and a Form I-9 and employer sanctions law internal audit will help protect employers from government fines and criminal penalties and help ensure that all I-9 Forms comply with I-9 and employer sanctions laws. 

Gerald Goulder is a North Carolina immigration lawyer who practices exclusively immigration law for North Carolina clients and for clients throughout the United States, and the world.  Immigration law is a federal law practice not limited attorneys in a particular state.