Employer’s Use of E-verify is Not a Substitute for Completing I-9 Forms, Fined More Than $200K in Civil Penalties
In the Final Decision and Order dated April 27, 2016, Administrative Law Judge Ellen K. Thomas ordered Golden Employment Group, Inc. (Golden Employment), a staffing and temporary-employment company, to pay $209,600 in civil penalties for 465 Form I-9 violations.
Golden Employment, which receives between 2,000 and 3,000 applications each year and has more than 20,000 people in its database, began using E-verify in 2008 to verify an employee’s employment eligibility with the Department of Homeland Security and the Social Security Administration. In some cases, Golden Employment would fail to complete certain sections of Form I-9 when an employee’s eligibility for employment was verified by E-verify.
In April of 2013, Golden Employment received a “Notice of Inspection” from Immigration and Customs Enforcement (ICE), the federal agency charged with reviewing a company’s I-9 compliance standards. ICE gave the company five days to provide Form I-9s for review. On April 15, Golden Employment provided four boxes of I-9s to ICE. In May and June, the company gave more boxes of I-9s to ICE, but these submissions were treated as untimely by ICE.
Under 8 U.S.C. § 1324a(b) and 8 C.F.R. § 274a.2(b), an employer is required to complete and maintain I-9s for each of its employees. Failure to properly complete or maintain I-9s can subject an employer to hefty fines. For each individual I-9 with violations, an employer can be fined a minimum penalty of $110 and a maximum penalty of $1100. When determining the appropriate penalty to asses against an employer, the following five factors are considered:
The size of the employer’s business;
The employer’s good faith;
The seriousness of the violations;
Whether the individual in question was an unauthorized alien; and
The employer’s history with previous violations.
After a consideration of the five factors, ICE recommended a fine of $605 per violation because it found an error rate of 35 percent in its review of Golden Employment’s provided I-9s. The government considered the size of Golden Employment as a mitigating factor that warranted a reduction in the overall penalty. However, the government felt that Golden Employment’s failure to complete I-9s for some employees or timely provide I-9s for review warranted a higher penalty. The remaining factors—good faith, absence of unauthorized workers, and lack of previous violations—were treated as neutral.
Golden Employment asserted that the government incorrectly excluded the I-9s that it provided to ICE late, which, when considered, would result in a total fine of $63,250 at most. In addition, Golden Employment contended that while some I-9s were in fact incomplete, because the company also verified an employee’s employment eligibility through E-verify, these acts, when taken together, should satisfy the I-9 requirements under the law.
In her Order issued on April 1, 2016, Judge Thomas found that Golden Employment committed 465 I-9 violations. Specifically, Judge Thomas found Golden Employment liable for 140 violations for failing to timely present I-9 forms; 236 violations for not preparing or presenting I-9 forms; and 89 violations for failing to properly complete I-9 forms. Having committed 465 I-9 violations, Judge Thomas could have assessed civil penalties against Golden Employment ranging from $51,150 to $511,500. Further, Judge Thomas stated that using the E-verify program does not “insulate an employer from the necessity of proper I-9 completion” and cannot be relied upon by employers as a substitute for the employment eligibility verification requirements under the law.
In her decision to assess a civil penalty of $209,600 against Golden Employment, Judge Thomas noted that Golden Employment’s failure to prepare I-9 forms at all for some employees “frustrate[d] the national policy intended to ensure that unauthorized aliens are excluded from the workplace,” thereby warranting a higher penalty. Concerning the other factors, Judge Thomas found that Golden Employment acted in good faith, thus warranting a reduction in overall penalty.
Golden Employment should serve as a warning to employers who use the E-verify program that E-verify is not intended to replace an employer’s obligation to prepare and maintain I-9 forms for each of its employees.