In this hour-long webinar, Attorney Michael Murray discusses the ins and outs of I-9 compliance, including:
- Proper completion of I-9 Forms
- The major rules you have to follow
- Deadlines for different portions of the form
- Common mistakes and pitfalls made by even the most responsible businesse.
Also available as a resource – our complimentary, 13-page I-9 Compliance Guide. If you would like to consult with an attorney at FordMurray about I-9 compliance, or other business immigration concerns, contact us today.
I-9 Basics, for those new to compliance or just needing a refresher
Transcript of Video:
Today we’re going to cover the fundamental core concepts for I-9’s so, if you’re new to I-9’s, trying to get up to speed this is the perfect webinar for you to attend.Hello and welcome attendees. This is Mike Murray of FordMurray, it’s nice to have you today, thanks for coming. Today we’re going to be talking about I-9 basics and this is going to be the first in a two-part series.
If you’ve been doing I-9 preparation, but you need a refresher. Need to kind of, revisit those core concepts this should be great for you as well.
So, part two of this series will come next month and then, we’ll talk about advanced topics, more exotic circumstances and situations that might come up in I-9 world. But, today we’re covering the basics.
Now, if you are new to the I-9 compliance world you may have heard rumors in the office that, I-9’s are boring. I-9’s are complicated. The form is non-intuitive. Those little boxes’ kind of, drive you crazy. You may have even heard the rumor that, if you don’t get it just right you could get in a lot of trouble with the government. The company can be fined. I’m here to tell you that all of those rumors are true, unfortunately.
The I-9 compliance world is not easy. It’s very technical. It’s hard to get your head around it. So, that’s the bad news. My job today is to try to walk you through to get you a good opening understanding of why we’re having to do this. The best approaches for filling out the different sections of the form. And hopefully, at the end of the hour if I’ve done my job correctly. You just, will have a better sense of confidence in approaching your job in approaching the form and doing it properly.
If I’ve achieved that, let me know. If I could have done it better at the end, send me an email with your suggestions, I would really appreciate it.
So, what are we going to cover today? We are going to take a tour of the form… For some reason I am not able to advance my slide here. Let’s see. Sorry for this technical difficulty.
Let me pop out and pop back in and see if that works. My apologies. And now, we’ve got it. There we go.
We’re going to talk about a proper completion of I-9 forms. We’re going to go over the major rules that you have to follow. We’re going to go over the deadlines that you have to complete different portions of the form by. We’re also going to take what I call a scenic tour of the form. What I mean by that, is that it’s not going to be a beautiful tour. It’s going to be a scenic tour in the sense that, we’re going to slow down and take our time. We’re going to go through section one, section two, section three and really kind of, dig into the different boxes so you know how to approach them and to also, highlight the different pitfalls and common errors that I see in my practice.
I’ve been doing I-9 compliance work for over 10 years now. I’ve done quite a few investigation audit defenses with DOJ and Immigration Customs Enforcement. The departments who enforce the I-9 rules. And, I’ve walked a lot of companies through doing their own internal I-9 audits. So, I’ve really seen it all.
Now, I’d like you to take out your form I-9. If you haven’t already, please go ahead and print out a form I-9. You’ll have nine pages there and the final three pages are the actual form with the list of acceptable documents at the very end. That’s pages seven, eight, and nine. Go ahead and print that out or pull it out in front of you.
To, kind of, take a step back and look at a more historical perspective. What’s happening with the I-9 obligation is that, the government is really pressing private companies into their service, to do part of their job. As you know, the Immigration rules tried to limit those who could enter through our borders, through the airports. Certain folks come here on a tourist visa or work visa and they overstay. And they become undocumented or illegal. Quite a few people kind of, fall through the cracks or make it through the system. It’s estimated that we have about 11 million illegal aliens or undocumented foreign nationals in the United States.
The I-9 process was setup so that employers would take part in the compliance. The obligation has been put on you guys to do the job that the government has been able to do and restrict those folks who aren’t supposed to get an employment benefit in the United States from getting it.
Now, how does the government do that or force you to do that, or persuade you to do that? Through fines and penalties. If you don’t do it right, you could be audited, investigated, and the fines can be very substantial.
This chart here kind of shows us that the government has really become very interested in I-9 enforcement. What happened was that, when the Obama Administration took office back in 2008-2009, he actually made a public statement and a policy to crack down on employment side compliance of I-9’s. Rather than just trying to deport illegal aliens and that, really caused a spike in enforcement actions and in binds assess.
So, this chart is telling us or showing us that over the past seven years or so, the total I-9 fines assessed annually against companies and you can see that, when the new policy went into effect around 2008-2009, the assessed fees started to go off the chart there. By 2009, we were already over a million dollars in assess fines per year. And then, in the past couple of years we’re up at the 16 million, approaching up to the 17 million dollar mark.
So, the government takes this seriously and they’re making money off of this. They have a budget item of about 130 million dollars a year that is dedicated to I-9 enforcement through Immigration and Customs Enforcement. So, this is why we have to take our function here in terms of, I-9 compliance very seriously and try to approach it in the right way.
Properly filling out your I-9 Forms
Now our first rule in terms of getting our I-9’s right is, which version should we use? You always have to use the most current version and the tough thing is that, the versions keep on changing. On average, we get a new I-9 form every three to four years. The forms don’t change a whole lot in terms of, content. But you can only use the current one that’s in place.
Now, how do you know you’re using the current one? For today at least, if you look at your I-9 form on page seven of nine. At the bottom left of that form, there’s going to be a version date, 03/08/2013. This is the current form and it’s the only one that you can use at the moment. Now, the problem is that, that could change you know, a couple months from now. A new form could come out. And, what I’ve seen happen with employers is that, you create an HR, a new employee orientation file. And in that file, you put a bunch of documents that employee’s need to sign on the first day, including an I-9 form.
You create maybe hundreds of these so that, you can efficiently just pluck one out when you need one. The problem is, the forms that are in those files will become expired at some point and no one is going to check to make sure the current form is there. So, you have to watch out for that. You have to make sure that you’re not using an old form that’s gathering dust in some file somewhere. You got to make sure those are updated. In my opinion, the only foolproof way of making sure you’re using the current I-9, is each time to pull off the I-9 from the government website USCIS.gov. That’s the only source that’s going to have the current form every time, in the opinion of the government.
I know that’s kind of, onerous and that would be hard to work into some procedures. But, if you’re ever worried about having the right form just go to USCIS.gov, search the form I-9 and pull it down and you should have the most current version.
Okay. The overall requirements for the I-9 Section One, Employee Information. If you look at section one there on page seven of nine. That’s where the employee is going to sit down and fill out their portion section one of the form. We’re going to hit each of these sections in detail. I’m just going to broadly go over them at the moment and talk about procedure a little bit.
Section Two, on page eight of nine is the Employer Section to fill out. And that’s where you’re going to ask the employee to give you a document from either List A or List B and C, that proves their identity and their ability to work in the United States. And, if you look at the page nine of nine, of the I-9 form, you will see that list of acceptable documents.
The employee should be able to choose from that list. You should put it in front of them and ask them to make the election of which form their going to use for the I-9 process. The employer would then, review the document, input data into section two of the form under List A, List B, or List C as appropriate. Put in the hire date or start date and then, sign the form as certified.
Section three has to do with reverification. And that’s where employees who have a time limited type of work status. So, let’s go ahead and dive into each of those sections and kind of blow up, the different parts of the form to give you some guidance on how to approach them.
First let’s talk about deadlines. When must the I-9 be completed? There is a big misconception out there that I hear again and again from my clients and, let me test you. Let me throw out a question and I want you to answer this question in your mind. You don’t have to email me or anything. You don’t have to say it to your group, you can keep it private. But answer this question in your mind. When do you have to do the I-9 process?
Okay, you know your answer.
Many people will tell me, “Well, you’ve got three days. You’ve got three days to do it.” That’s not correct. The I-9 has to be started on the first day of employment. That section one, the employee section. Has to be filled out on that first day. Section two, can be completed by the employer by the third day of employment and really, that’s the third business day of employment.
So, the process of actually looking at the employment document and verifying the identity, that can be done on the third day. So, it’s really kind of a two part process there. However, if you have an employee who’s going to be working for less than three days, then the I-9 actually, has to be completed both sections one and two, on the first day.
In terms of section three. When does that have to be completed? Well, that is the reverification section on the bottom of eight of nine. And, that applies to your most likely, for a national worker. You have to make sure you complete the reverification section before they’re current work authorization expires. There’s no grace period there. You’ve got to complete it before that expiration date.
Alright, now let’s dig a little more deeply into these sections. Section one, of form I-9 if you pull it out there and take a look at the top. This again is the employee section. The first box is the last name. The second box is the first name. We’ve got the middle initial. Employee is filling this out. It’s pretty straight forward. Then, we get to other names used and, if you’re employee doesn’t have a maiden name, probably, they’re not going to have another name.
Now, you can leave it blank and move on. No. You actually have to put in N/A. That is not applicable. This is a new aspect of this latest version, the 2013 version of the I-9 form. So, you’ve got to now put N/A’s into boxes that are left blank. Okay, so keep that in mind.
Now, you’ve got your address box. Note that the address has to be a US address and it’s got to be a physical address. Basically, the government wants to know how do we find this employee if we need to find him or her? So, it cannot be a PO Box, it’s got to be a US address. To an apartment number, if there is no apartment number, you want to put an N/A in there. City, state, zip code, all very straight forward. Date of birth. All of that proceeding information, if it applies, is required.
The next three boxes, social security card number, email, and telephone number. Those are optional, so N/A’s can be put in there if the employee doesn’t want to provide it. However, if you are an e-verify user. The employee does have to fill out the US social security number for e-verify purposes. So, keep that in mind.
Now, let’s go down to the boxes. The boxes, one through four there, stacked on top of each other, is a very important part of the form. This is where the employee, makes their election. This is where they’re going to represent to you and to the government, “This is my immigration status. This is how I have authorization to work in the United States.” You have to make sure one of these boxes are checked. It cannot be left blank. To do so is a substantial violation. So, watch out for that.
The first check box there is Citizen of the United States, very straight forward. And, most of the I-9’s you’re going to process are probably going to be for US Citizens, depending upon your business. The second box is a non-Citizen National of the United States. And that for me, is always kind of a head scratcher. Even as an immigration lawyer, I ask myself. “What does that mean?” It kind of sounds like an oxymoron. A non-Citizen National of the United States. That is a very narrow group of folks who live in Micronesia on the Marital Islands. On Karen’s Island. Karen’s Island has a population of about 17 people so, this is a box that describes a very small set of people in the world.
If you find yourself clicking this box or, if you see the employee click the box. Let me know because, my theory is that every time box two on an I-9 is clicked an immigration lawyer gets his wings. It’s just one of those rare things. So, it’s probably a box you’re never going to have to worry about.
Going down to box three. We have a Lawful Permanent Resident. That’s a Green card holder of the United States. If that box is clicked then the individual is going to write in their Alien … Their A number in the space provided there.
And then, we have the fourth box, an Alien Authorized to work until a certain date. And, these are going to be foreign nationals who have types of work authorized Visa status like H1B or L1 or TN. Or, individuals who are applying for asylum, or waiting for a Green card and they might have something known as an Employment Authorization document. If, the employee clicks this box they’re going to have to write in a date by which, their current status expires there in the blank. And that’s important and we’ll talk about that when we get to the reverification section, section three. Because that’s going to be a part of a tickler system for the employer to watch and make sure that you’re re-verifying that expiring work authorization status, in the right time.
Finally, if you go down to the middle of the form, you’ll see the spot where the employee must sign and date section one. You have to make sure they do that. Without doing that, they’re not honoring the representations that they’ve made on the form and in fact, if you don’t make sure they do it. It’s the employer who assumes the liability for that being incorrect in the context of an investigation. The government will assume that you haven’t done your job properly because, it was the employer who should have made sure that section one is filled out correctly.
So, once the employee fills out that section. One, you do want to go over it and make sure that it’s legible. That N/A’s are there. Required information is filled out. That one of the boxes are checked. And that it all kind of makes sense. If someone is telling you that they’re a US Citizen but they clicked the Lawful Permanent Resident box, you’re going to have to ask them to do it over again, okay?
Let’s go back just for a minute and look at, the last two certification boxes. As I mentioned, those are important if you have to track whether someone’s status is going to expire. So make sure they write in the A number and the admit until date because, those trigger that re-verification obligation that we’ll get to here in a minute.
Okay, now here is some practical tips and things to remember about filling out section one and making sure the employee’s done it correctly. A question that I often get is, “Can the employer help out? Cause we believe in customer service in our HR department. Can we pre-fill some of the boxes in section one or do it for the employee?” The answer is, no. The employee is the one who has to be allowed to do that. They need to make the representation of who they are, where they live, what they’re vital information is. And, what kind of status they have.
Another question I get a lot is, “Can we tell the new employee which documents to bring in? Because, it’s just easier to input a Passport or a Green card or a driver’s license, an SSA card. Can we give them a recommendation?” And the answer again is, no. The employee is the one who has to choose. And they have to be allowed to look at that List A and make the choice for themselves.
And this brings up one of the tensions that you’re going to find in your I-9 work. That, when you’re trained in HR or the legal department if that’s where you do your I-9’s. When you come up to conversations about national origin or racial discrimination or, immigration status. You’re trained to run away. Don’t go there, that’s a red zone, we don’t talk about that stuff. And so, you should in the usual case. But, if you have to do I-9’s, it’s actually, your job to go right in there and verify someone’s work authorized status. How are you here? How do you have the right to work in the United States? Prove to me that you’re not an illegal alien. In so many words, that’s what you’re asking.
And so, you’re in this red zone and, you may feel that tension. How do you negotiate that? How do you navigate that safely? What I tell my clients is to make sure that you let the form do the work. And really, that’s what Department of Justice has told us. The employee should not only get the I-9, that last three pages. Seven of nine through nine of nine. They should also get the first six pages, which is the instructions. Now, those instructions are pretty long and chances are, you’re not going to have enough time in your 15 minutes of orientation for the employee to read it all.
However, that doesn’t mean that you can do the process for the employee or, direct them as to how they can do it. What you should do is, point them to that list of acceptable documents, that last page of the I-9 and, if you get a question of, “What should I bring in? I forgot to bring my documents today. Can I bring in a Passport? Can I bring in my birth certificate?” You shouldn’t tell them which they should bring. You should have let them chose. That is the safest way to negotiate that situation.
You never want to ask for specific documents. So for example, you don’t want to have an HR letter that goes out to a new hire that says, on the first day of employment make sure you bring either your Passport, or a birth certificate, driver’s license. So that we can complete the I-9 process. That would be directing the employee and the government may see that as discriminatory because, not everyone has a US Passport. Not everyone has a US birth certificate.
And so, that is kind of a red zone area to be in. If in the process of doing I-9’s you get those questions. “Can you please let me know which documents are acceptable?” Just point them again, to that list of acceptable documents and let the form do the work for you.
Employer Documentation Review and Certification
Okay, so that completes our overview of section one. Let’s now move onto Section Two, the Employer Documentation Review and Certification. This is really kind of a two part process. You have to verify that the employee is who they say they are. And so that, is the identity portion of the verification. Then separately, you have to verify that the employment eligibility of the employee, is valid.
Now, identifying identity is pretty straight forward. They’re going to show you either a List A document like a Passport or they’re going to show you a List B document like a driver’s license. You do have to take a look and just make sure that they look like the picture there. You have to do a good faith review, okay? You have to be reasonable, that’s the standard for your identity verification.
It’s also the standard for the employment eligibility verification. Now, I get this question a lot. “I’m not an immigration lawyer. I don’t know what a real Green card looks like and what a fake Green card looks like. How am I supposed to tell the difference?” And the truth is, you don’t have to be an immigration lawyer because, the legal standard is that you have to do a good faith review. So, you have to take a look. If there’s something obvious, that tips you off that the card looks fake. The fonts are off. The picture is fixed in a strange way. Then you would not be able to accept that document.
There is an employer handbook on completing I-9’s, provided by Immigration Customs and Enforcement. And, at the back of that there is a list … I’m sorry, there are photos of the different types of documents that you might see. So, if you’re the prime primary I-9 preparer at your company, you may want to take a look at that and just, familiarize yourself with those different types of documents.
As another note, you cannot accept an expired document. It used to be that an expired Passport was a valid and acceptable List A I-9 document. That rule changed. So, no longer can you accept even an expired US Passport. It has to be current.
Okay, let’s zero in a little more on section two, and what’s required. Let’s tour this section two and look at our different boxes here. If you look at the very top, the first box. It says, list the employee name, first name, middle name from section one. This is one of the most common mistakes I see in my I-9 work. It’s just really easy to miss that box and it’s also not intuitive that you would need to re-enter the employee’s name since it’s already on section one. This is a new component of the new form. So, just watch out for that. I see it missed all the time. The reason it’s there is so that, if the two different pages become detached, you know which one belongs with which. But, just watch out and put that in. If you forget to put it in, it is a technical violation so, watch out for that.
Then you’re going to input the data from the proper document by the employee either in List A or List B and List C and we’re going to blow one of those boxes up here for you in the next slide to show you how to do that properly. The other box or blank, that I see employer’s missing is in the certification there towards the bottom. There’s an arrow towards that blank, where you’re going to put that first day of employment. For some reason, the human eye just glosses over that blank. I see it missed all the time. And this is probably, the biggest error you could make on the form because, that date. That start date, tells the government when the deadlines start for you and the employer and this I-9 and by when you had to complete things within the one and three day different timelines.
So, if you miss that. You’ve kind of ruined the entire process and form. So, make sure you always zero in to putting that blank in there or, filling out that blank.
Now, it seems very straight forward at the bottom of the form to simply, fill out your name, the business address, the business name, to print your name. I see mistakes here a lot as well. And the one that I see is that, the business address is abbreviated. You’re not supposed to abbreviate things on a form I-9. You have to spell out your entire company name and address. And it gets a little taxing because, let’s say your in-taking five employees on one day. By that fifth form, you’re wanting to just scribble it out quickly. You know where you are. The government probably knows where you are if they’re investigating you, they’ve already served you a notice at your place of business. But, it is a technical violation to abbreviate or shorthand the employer address or the employer name. So, watch out for that as well.
Okay. Here’s a blowup of one of the boxes in section two. Let’s say that, our employee has prepared to us, a US Passport. How do we properly fill this out? The document title is the full title. US Passport. The issuing authority, you’re going to want to put in the full authority of that document. US State Department. If it’s a driver’s license, maybe it’s the State of New York. Maybe it’s the commonwealth of Massachusetts. You want to spell that out there in the issuing authority.
Then, you’re going to want to put in your document number. For a Passport, that’s going to be the Passport Control number that’s at the top right of the Passport. For a driver’s license, that’s going to be the driver’s license number. A birth certificate would usually have some kind of registration number on it. So, if there is some kind of document number, you’re going to want to put it right there.
And then, you’re going to want to put in the expiration date. And, this is another way for you to make sure that you’re not accepting an expired document like an expired Passport. It’s also a way to tip you off as to whether or not you’re going to have to reverify someone if they have the type of work status that needs to be re-verified, based upon this expiration date.
Okay, some practical tips about section two, now that we know how to fill it out properly. You have to accept any document specified in List A or List B and C, provided that it appears genuine and relates to the employee. And, if the employee has given you a document that you’ve never seen before but, is on the list. You have to accept it, you can’t pick and choose.
At the same time, you’ve got to make sure that, that document is actually on the list. There is sometimes, some exotic documents like Certification of Report of Birth issued by Department of State. Things that you may have never seen before. You just want to make sure before you accept it, that it’s actually on that List C, or List A. So, go ahead and check it against the accepted list of documents.
Here’s an important point and, this can lead to a type of fine called Document Abuse. You can only accept a minimum required set of qualifying documents, not more. So, what does that mean? Let’s say you have a new, model employee. This person is very detail oriented. They walk in on the first day and they tell you. “Man, I am prepared for this I-9 process. I’ve brought everything I need and more. Look at what I’ve brought for you. I have my Passport. I have my driver’s license. I have my social security card. I have my Birth Certificate. Here, I am very qualified to work in the United States.” Well, that’s great that they brought in the documents. That’s wonderful. But, you can only accept one set of qualifying documents, not more.
So, that means, you would give the documents back and you would say, “Employee this is fantastic work, we appreciate it. However, we only need one set of qualifying documents. So, give us the one that you would like us to input onto the form.” So, let’s say they give you the Passport. You just input the Passport. You would not fill out List A and List B and List C with all those documents.
And the reason why the government is worried about that, that’s really not intuitive. If, they see you filling out all those lists and accepting more documents than you really need too. They think it’s Document Abuse and they start worrying that you have a higher standard than you need to have. That you don’t just want to see a Passport. You want to see a Birth Certificate, a US Birth Certificate and so, they think you’re setting a standard higher than the law. And that maybe, even your implementing that in a discriminatory way.
So that’s the concept of Document Abuse. You want to make sure you’re accepting the minimum required set of documents.
One other rule to remember is that, you cannot ask a candidate for a job to fill out an I-9 prior to an offer of employment. So let’s say you have three finalists for a position. You just want to get some of you worked on advance, let’s go ahead and send I-9’s out to all three of those finalists. Can’t do it. You have to make sure you only start the I-9 process, after an offer has been made.
Now, on another note. You can complete the I-9 before, the first day of employment. You can do it advance in that sense. So, it’s got to be done somewhere between the offer being made and then, that first day of employment. That’s the window for you to start your I-9.
Important Deadlines for Parts of I-9 Form
Okay. We’ve made our way to section three. And this section, may apply only to a small subset of the employees that you have and most of these people are going to be foreign nationals of the United States. Section three has to do with employees with a time limited work authorization. Those are going to be employees who have H1B Visas or L1 intra-company transfer visas. Trade and app through our TNB Visas through Canada and Mexico. Or those employment authorization documents that I talked about. Also, some Green card holders may be subject to this requirement.
Now, I’ve pointed out to you before how you’re going to know that someone has a time limited work authorization is that, they’re going to list that or, they’re going to click that fourth box on the first page of the I-9 form. I’m sorry that fourth box on the first page. And, they’re going to tell you actually, my work authorization will expire on this date. So, you want to take those dates and you want to turn that into a tickler system for HR or legal to remember to follow up with those employees. And, I would say that you’d want to give them a warning or notice that the work authorization documents that we have on file, are going to expire four months from now. 120 days from now. Please do what you need to do to give us new work authorization documentation before the expiration date of the current document.
And, you want that much lead time because, it really can take months for these employees to get the types of work cards or other types of employment authorization, proof that they need to show you. So, they need to start ahead of time. If they wait till the week before, it could be 90 days before they can get the card and they would have to come off the payroll during the time they’re waiting for that card.
Now, the reverification requirement has only to do with re-verifying work authorization. It does not have to do with re-verifying identity. So, you’re never going to have to reverify a driver’s license or a military ID card. That’s not what this is about. You only have to reverify work authorization documents. The concept or the question of whether or not you need to reverify a Permanent Resident of the United States, can get a little tricky. There are different forms of Green cards or Permanent Residence. There’s a two year conditional type of Permanent Residence. Which usually has a two year expiration on the card. There’s what I call kind of a Permanent Residence, which has a 10-year card.
Then there are other types of legal evidence of Permanent Residence status and that’s known as an I-551 stamp, which is kind of, a red or pink stamp that’s put into a Passport. The shorthand for remembering which of those have to be re-verified. Is that, if you have the Green card the “plastic Green card”. That does not have to be re-verified. Even if it’s only a two year card or a ten year card. You don’t have to reverify it.
If it’s the I-551 stamp or some other proof of Permanent Residence status. Then you would have to reverify that employee and put them into the tickler system. So, that’s a relatively easy way to remember that standard there.
Alright, let’s go through section three box-by-box. The box A, we’re going to put in any new name that the employee got in the time between now and the last time you verified them. So, let’s say they got married or something like that. You’re going to list that new name. Now, note however. There’s no obligation to put in a new name if you’re not re-verifying so, let’s say for example. You have a very eager employee who just got married. She comes to your office and says. “Hey, I have a new name can I update all of my HR documents?” You’d be happy to help them with that. You are not required to update the I-9 at this point. You can if you want too, but it’s not required so, just keep that in mind.
Box B, date of rehire. That’s actually, a separate concept from reverification. If you look at the title of this section three. We’ve got reverification and rehires. We’ll talk about rehires in part two of our I-9 webinar series. It gets a little complicated, so let’s just table that one for now.
Going down to Box C, you’re now going to input the new work authorization document. You’re going to put in your document title. For example, a new employment authorization document. You’re going to put in the specific document number, of that document. And then, you’re going to put in any new expiration date for that individual. So let’s say, they bring you a new EAD Card. These cards are usually good for one year or two years. If they give you a new card, that has an expiration date, you’ve got to put that there in the expiration date box. That means, you have to re-input them into your tickler system because, now you have a new term that’s going to expire and you’re going to have to track that as well.
Now, as another example. That same employee might come back to you. And let’s say that employee was an applicant for asylum in the United States. They had an interim EAD, that was good for one year. But upon reverification, they brought you a new document, that’s absolutely fine. Now it’s a Green card. They were granted their asylum and now, they’re showing you a US Permanent Residence, plastic Green card. You’re going to input that new document title in there. Put the new document number and, there’s going to be an expiration date for the card. Either two years or ten years and you can put that in there. But because, it’s that plastic Green card, you are not going to reverify that individual, okay?
And then, you’re going to remember to put in your name and sign and date the reverification certification there.
Alright, we’ve finished our tour of the form. I’m sure that, that was very exciting for you. Hopefully, you have a deeper understanding of what those boxes mean and, how to fill them out. I want to cover some other concepts that I see tripping up some of our clients. The first is, the receipt rule. And, this means that some employees who come to you will tell you, “Geeze, I know I have three days to show you one of these documents from the list. However, I lost my Passport and there’s no way I can get a new one before that three days expires.” Or, “I had my birth certificate. It put through the wash and it’s been shredded. I’m going to try to get a new one but, I don’t have it today.”
So, this is where the receipt rule comes in. And, it has to do with lost, stolen, or damaged documents that the individual already possessed and now, are just trying to replace. That’s really important. This is not about individuals who are seeking to get some kind of immigration or work authorization status. For example, someone who applied for asylum and is waiting to get their card. They can’t bring you the receipt for the card that’s going to be issued within 90 days because, that wasn’t lost, stolen, or damaged.
Someone who tells you, “Well, I’m going to get H1B status soon. Can I show you the receipt?” That doesn’t apply here. The receipt rule would not work for them, okay? So, it’s only for lost, stolen, or damaged documents.
Now, the funny thing about the receipt rule is that, it’s certainly going to help certain employees and employers, and give you more time to get you the documents they need. But, the I-9 form is really not setup for inputting those receipts. However, there is a procedure for doing it correctly and that’s what I’m going to walk you through here. Just, one another note on the receipt rule. You don’t get 90 days to proctor the receipt. The receipt has to be given within that three day timeline after the start. So, an employee on day one who tells you. “Geeze, I lost my Passport, can I bring you something in 90 days?” It’s not good enough. They have to go and apply for the Passport right away and give you the receipt within that three day period.
So, make sure that it’s not 90 days to do nothing. It’s a couple more days to do what you need to do to get that receipt and then, you’ve got 90 days for the new document to come in, okay?
So, how do you properly input a receipt into section two of the I-9? If you pull up section two there, you’re going to enter the document title. Let’s say it’s a US Passport. You’re going to enter the word “Receipt” and any document number that might be on that document receipt, into the document number box. There may not be a document number, which is okay. But if there is one, you’re going to input it there as well.
And then, in the expiration date box. You’re going to enter a date 90 days into the future, okay? And then, you’re going to enter that individual into your tickler system for follow up, alright?
Now, when the actual document comes in. You’re going to cross out the word “Receipt”, and any document number and then, you’re going to enter the actual document number. And so, you would put in the Passport control number that you see there on the Passport. Then you’re going to cross out the 90-day expiration date and enter the actual expiration date of that Passport, whatever document it turns out to be. And then, you’re going to initial and date those changes.
Not intuitive. The form is not set up to do that but, the receipt rule is an important tool for you guys and that is the way that you would use that rule and put it into our I-9 form.
Okay. Retention of I-9 forms. This is an area that can get a little tricky. We know we have to do I-9’s but, for whom? And, how long do we have to keep them? A good shorthand is, every employee hired after the I-9 implementation date, which was 11/06/1986, must have a completed form I-9, on file. So, you have an active employee on your payroll they were hired after 1986, most of them will be. You have to make sure you have an I-9 on file for all of those employees.
Now, employers have the ability to terminate or purge, I-9’s for terminated employees. And really, you want to make sure you do terminate … I’m sorry, purge the I-9 forms that can be purge because, if there were mistakes on those I-9’s, let’s say there was a couple of years and I see this quite a lot, where the I-9’s weren’t done properly or, they weren’t really being focused on. Once they reach the date for purge, you can simply get rid of them. And the government will never see them and any kind of risk or liability contain all those forms, can be removed from the company. Shredded and then, you don’t have to worry about them anymore.
The rule for when you can purge an I-9 is a little tricky. It always takes me a little while to get my head around it. So, let’s talk it out here and then, I’m going to show you some samples of how it actually works, alright? The rule is, you can terminate … I’m sorry, you can purge I-9’s for terminated employees three years from the date of hire or, one year from the date of termination. Whichever is later. It’s that last phrase, whichever is later. That trips up a lot of people.
So, let’s do an example of some start dates and some term dates for two different employees. Our start date is going to be the same January 1st, 2000. The term dates are going to be a little different. One in 2011 and one in 2015. We’ve put into our slides here, a retention worksheet that you can print off and use for any I-9 that you need to put through this analysis. And then, I’ve given us a cheat sheet for those two examples that I showed you before.
On the left, we’re going to see the dates for the earlier terminated employee and on the right, for the later terminated. So, you would enter the employee start date on that line one. It’s going to be 1/1/2010. And then, you add three years to line one. Which brings us to January 2013. Then you enter the termination date in line two. And on-line B, you’re going to add one year to line two.
So, in our first example we’re going to get the date January 2012. And then, just to follow that one out. The first example, you go down to C, which date is later, A or B, enter the date here. And here, it’s going to be the 2013 date which is later. So, the one from the top number one line there. They only stayed at the company for one year, so you have to use the later date and add three years … Or, I’m sorry. To retain it for at least, three years. And that’s going to be our retention date. So, 1/1/2013 at the very bottom in C, is going to be the last date that you have to keep that I-9, at your premises, okay?
Now, for the employee who is terminated in 2015, the result is going to be different. They were hired on the same date but, in line two we have entered a termination date of 1/1/2015 and then, under two B, we’re going to add one year, which gives us 1/1/2016. And then, the later date between A or B, is going to be 1/1/2016. So, that I-9 has to be retained until that date.
And, you can see there’s a difference here. They started at the same date. They had different term dates, and therefore we have a three year swing in how long the I-9 has to be retained. I know it’s a little complicated but, if you simply go back to this worksheet here and you apply it to any single I-9. It’s pretty straight forward and you’re going to get the term date or the purge date that you need.
Now, it’s important as I said before, to make sure you’re purging these I-9’s when you can. So, what I recommend is that, you have a binder wherever you retain your I-9’s. You have a binder that, one is dedicated to active employees and the other is, dedicated to terminated employees. And so, as soon as you know an employee has been terminated. Then, you would move that I-9 from the active binder over to the terminated binder. And then, you would take this worksheet and you would work through it and get that date on, on line C and that’s going to tell you the purge date. And you can put a sticky or just write in pencil, that purge date. Maybe at the top right of the form I-9 and then, in that terminated binder, you can go ahead and organize those I-9’s by date of eligible purge.
And maybe, once a month have someone who goes through the binders and shreds, gets rid of, those I-9’s that can be purged and any worries and stress you had about any of those I-9’s, goes away with the I-9.
Now, what is the proper method of storing the I-9’s? Most of our clients use paper. Paper absolutely works. You going to keep those original I-9’s signed by the employees and the employer. You want to keep those I-9’s separate from the employee file and going down to the bottom of this slide here. The reason that you want to do that is because, the government recommend it. But also because, you’re only going to get three days. If you get a notice of investigation from Immigration Customs Enforcement, they’re only going to give you three days to turn over your I-9’s, whether they’re paper or electronic or what have you. And if, those I-9’s are embedded in employee’s files. It’s going to be really tough for you to get all of those in order in time. So, you want them to be separated and ready to go if the government asks for them.
If you want to jump into a hot tub time machine and find a micro fish or a microfilm machine on eBay, you are still allowed to do that under the rules. Or, you can store your forms electronically. You can make electronic copies, digital copies, of the I-9’s and then, destroy the originals. But, keep in mind that there is some maintenance that’s required there for the electronic storage of I-9’s. You have to make sure that the I-9’s are secure. Which means that, they’re restricted access to those employees who need to use them and not just anyone can access them.
You have to have a recovery plan so that, if you’re IT infrastructure gets wiped out there’s some way to recover from a recovery disc, or something like that. A backup disc, all of those I-9 forms. The system has to be auditable. Which means that, the government has to be able to see who accessed the electronic I-9’s and whether, someone made a change to those I-9’s. And then, you have to periodically go back and monitor whether there’s been any tampering of the forms.
Properly correcting an I-9 requires a certain procedure. Whether you’re doing an I-9 and you see that you’ve made a mistake or, you’re doing an internal audit, going through your files to make sure that everything is up to snuff. You want to make sure that you’re making the corrections in the right manner. And, the theme here is that, you have to let the government know what you’ve done. You’re not trying to hide the mistake and cover it up. You’re making a correction because, you know you need too. But, you’re showing the government what you did.
So, you want to line through any wrong information in a nondestructive manner. Then, you write in the new information in the margin or in your other box your using. And you initial and date the change in real time, as your making the change. You don’t ever want to use correction fluid or black and cross out information so the government can’t see it. And the thing that you really never want to do is to backdate a form.
Let’s say, you do an I-9 and you forget to put the date of completion in section two. Never go back and make it look like you completed it within the three day timeline. If you miss the timeline, you missed the timeline. And so, you’ll have to sign and date it, on the date that you actually signed and dated it. To do anything different is taking an I-9 violation, which could result in a fine of some type. But, taking that and compounding the problem and turning it into fraud on the government, and that’s the thing that you really want to avoid. So, watch out for that.
I mentioned, doing internal I-9 audits. This is the procedure you would use for that. We do have a separate tutorial on I-9 internal audits on our website called, “How to Conduct an Internal I-9 Audit”. So, if you’re interested in that, check that out or give us a call.
Common I-9 Mistakes and Pitfalls
Alright. What happens when the I-9 is incorrect? What are the penalties that we’re talking about? Now, I’ll tell you that in, with the different companies I’ve worked with, in internal audits or government audits, there are always mistakes. I mean, unless you have a program that you’ve really focused on and done a lot of training for the I-9 preparers. Inevitably, you’re going to find mistakes. And, hopefully you’re not so Type A that you can’t forgive yourself for that or forgive your staff members because, it’s just the lay of the land in I-9 world.
Some of those are correctable through I-9 audits, some of them are not. The key is to try and be vigilant. To keep up on your training. Review the I-9’s that are coming through your department to make sure that, everything looks like it’s correct. There’s no way to get perfect I-9’s but, you can certainly improve your performance so, that’s the goal.
And I say that because, I don’t want to scare you too badly when it comes to these civil fines and criminal penalties. I showed you that chart in the beginning, showing you that the government is really after some revenue here for I-9 violations. And so, that’s the reality. That’s what’s happening out there. It’s not uncommon to see penalties against companies in the millions or hundreds of thousands. We’ve seen that in the last couple of years. So, that’s out there.
This is the penalty scheme. Now, this covers criminal violations and intentional hiring of unauthorized aliens. The folks here on the webinar today are listening to this. You’re really not going to be in that group. So, in that first column there, knowingly hiring an unauthorized alien. We’re not going to be doing that. Committing or participating document fraud, that third row there, or column. We’re not going to be doing that, either.
Just know, that if you do, do things like that then, there are criminal penalties and civil penalties that are really high. If you look at the criminal violations at the bottom of this graph. There is a term there call Pattern or Practice of Hiring Unauthorized Aliens. Again, we’re not going to intentionally do that but, that’s the one piece I think, all of us have to worry about.
If your program is in such shambles or, has been ignored to such an extent that you’ve actually, hired unauthorized aliens, they’re on your payroll because, you really didn’t verify them. You could fall into that category of criminal violations for Pattern or Practice, even if you didn’t intend too. So, that’s something’s for watch out … Or make sure you do have a program. Make sure you have done training because, now we’re talking about individual liability as you see there, even for a first offense. You’re talking about six months in prison.
So that’s serious. So, make sure you’re not doing that. But, if you’re doing your I-9’s. If you’re doing periodic trainings, you’re not going to be in that category. What I will highlight, is the second row here. Failing to Comply with Form I-9 Requirements and then, the fourth row. Committing Document Abuse, which I’ve mentioned before. Those are fines that I see quite often being imposed on companies who are audited or investigated for I-9 work.
Now, let’s break that out into the actual fine structure that the government has in its regulations. You’ll see here that there are different amounts for first offenses, second offenses, and third offenses. Any I-9 that has a mistake that’s not correctable would be $110 fine at a minimum for the first offense. We’ll skip the second and third offenses for sake of time.
But, going down from $110, you see that certain companies will be fined $935 per I-9 that’s incorrect. And the way you get to that escalated fine per form is overall, there have to be 50% or more of your I-9’s that contain mistakes. And you might think, “Well, that’s not going to be me.” The truth is, it probably is you if you haven’t done internal audits or trainings.
When I do internal audits almost every single one results in forms that are at that 50% rate. And so, that is the reality of what I see out there. So, how much of a fine would that be? Let’s just do a quick example here. If you had 1,000 employees and there was a 50% error rate. So, we had 500 I-9’s that had mistakes on them. You would multiple 500 by 935 and you’re at $465,000. That’s half a million dollars in a fine.
So, we’re talking about some pretty big numbers for having papers that are not in order basically, are not done correctly. That is the enforcement mechanism that the government has been imposing on employers.
The other thing I’ve seen is that, when I first started doing I-9 Compliance audits, or Defense Investigation Defense, 10 years ago, 12 years ago. Back then, it was really easy to negotiate these fines down. Either to a warning or I would sometimes get a 90% discount on the fine that was implemented and my clients thought that I was a hero. These days, the government is not negotiating like that. It’s much harder to get a discount. Cause as I say, they’re focusing on this now and they’re looking for the revenue. So, that’s the reality on the ground, that we’ve seen in the last five years or so.
I’m just going to kind of, skip over these couple slides here with criminal issues and penalties. We talked about that a little bit and this group really doesn’t have to worry about it. Just worry about that Pattern and Practice violation that you could fall into.
That concludes our webinar on I-9 basics. Thank you for attending. I hope that it was valuable to you and that, you learned a lot. Please join us for Advanced Topics in I-9 issues, next month in our webinar.
And, if you plan to join us, if there are certain topics that you want to cover, send us an email and we’ll try to work that into the presentation. Also, if you want a copy of these slides, send us an email and we’ll send that over to you.
Thank you for your attendance and have a great day. Bye, bye.