FORM I-9 AUDITS: Fines Increased in 2020

The Department of Homeland Security recently increased the penalties for Form I-9s. New fines are effective for all penalties assessed after June 17, 2020, for associated violations occurring after November 2, 2015. 

Immigration and Customs Enforcement (“ICE”) have increased Form I-9 audits year after year, so it’s important for employers to understand the audit process and the fines that are associated with these violations. 

The process typically begins when ICE serves a Notice of Inspection (“NOI”) subpoena to review the employer’s I-9 forms and other HR-related records. The NOI requires the employer to produce the requested documents within 3 business days (Extensions may be considered at the discretion of your local ICE office). 

After the documents are inspected, the employer may receive a series of notices, most commonly a Notice of Suspect Documents or a Notice of Technical and Procedural Failures. If substantive paperwork, hiring, or continuing-to-employ violations are found, ICE normally issues a Notice of Intent to Fine (“NIF”). If the errors are less than 10%, ICE may issue a warning notice without a penalty. 

CALCULATING PENALTIES

Penalty amounts are determined by ICE attorneys and special agents in charge. Agents determine the appropriate fine level by using the number of violations of each type (paperwork, hiring or continuing-to-employ) as the numerator and the number of total employees as the denominator. The fines could then be adjusted up or down 5% for each of these five factors: Business size, good faith, seriousness, employment of unauthorized aliens, and prior history with ICE. Employers should consult with their attorney to verify that ICE’s calculations are correct and that violations have not been double-counted. 

Employers can attempt to negotiate a settlement or can challenge the fines within 30 days of receipt of the NIF by requesting that an administrative law judge review the case. 

PREPARING FOR A FORM I-9 AUDIT

Your best defense is a good offense. 

First and foremost, get it right the first time around. If you’re in charge of completing I-9s, make sure to read the Form I-9 instructions and the free I-9 Handbook for Employers on the US Citizenship and Immigration Services (USCIS) website. There are also free webinars and other learning resources available on the website. Employers should also subscribe to the agency’s email list for notifications regarding updates and changes to forms. 

• Use the most recent form, dated 10/13/2022. Completing an I-9 with an old form is a violation; 

• Before completing Section 2 of the I-9 Form, review Section 1 to ensure the employee’s section is filled out correctly and completely. Did they select the citizenship status that matches the documents presented for verification? Did they mark any blank spaces with an “n/a”, like apartment number, email address, or phone number? Did they check the “preparer/translator” box at the bottom of the form?

• Only accept unexpired documents to complete the Form I-9. Verify that the documents presented are acceptable documents per the Form I-9 Instructions. For employment authorization and permanent resident cards, learn where to find the card numbers and the issuing authority. These cards differ based on the issuing agency and date issued;

• Make sure Sections 1 & 2 are completed accurately within 3 days of the employee’s first day of work for pay; 

Conduct a self-audit and remediate any noted errors.

• Self-audits should not be conducted by the person who completes Section 2 of the form; 

• It’s important to note that remediating an error doesn’t wipe the violation off the board. Even if corrected, that violation will still count as a violation; however, the correction will be evidence of good faith that may decrease your overall fine amounts;

• All Form I-9 corrections must be done in a very clear and transparent manner. Each correction must be dated and initialed by the individual updating the form. Errors or omissions in Section 1 should only be corrected by the employee. Mistakes in Sections 2 or 3 should be corrected by the employer or the representative conducting the self-audit. Corrections must be made carefully as improper corrections could in and of themselves create new violations. There MUST be an audit trail. NEVER use white out or erase information on a form. Do not complete a brand new I-9 Form (unless it’s attached to the original form being audited due to being unable to mark corrections legibly on the original form). All changes made must be transparent and documented. Note that most ICE offices prohibit altering or correcting I-9 Forms after a NOI has been served;

• Make sure you have all of the I-9 forms you’ll need based on required record retention timeframes. Before sending terminated employee files to storage, make sure their I-9 forms are not in their personnel records; 

• Keep your employee lists up to date and available. Make sure you have an I-9 form for every employee on your roster, at minimum. You should also have the I-9 forms for every employee who has been terminated within the past 1-3 years (if 3 years after hire is a later date than 1 year after termination); 

IF YOU RECEIVE A NOTICE OF INSPECTION FROM ICE

Immediately contact your attorney if you receive a NOI. Your attorney or other high-level company representative should be available during your inspection to answer questions or provide any clarification needed by ICE inspectors.

You will only have 3 business days from the date the NOI is served to produce all requested documentation. I-9 Forms must be retained for three years after hire or one year after termination, whichever is later. Retain all of your I-9s in the same folder, not in individual personnel records. You will be required to turn over other supporting documentation as well, like payroll records or employee lists, with your I-9 forms. 

• Make copies of all records before providing original documents to ICE for inspection in case there is a mistake in the chain of custody with your originals;

• Do not provide more information than is requested or allow ICE to inspect documents outside of the scope of the NOI or subpoena. Never attempt to destroy or hide documents; 

Given the quick turn-around time required to produce documents for inspection after receipt of a NOI, it’s critical to ensure that all of your I-9 Forms are organized and easily accessible for production and that documents exceeding record retention requirements are regularly purged. 

We offer Form I-9 assistance should you need a helping hand. Our services include conducting training on how to complete I-9 forms for managers (or designated representatives), how to complete a self-audit of I-9 forms and remediation of errors, how to implement record retention best practices for Form I-9s, and how to provide support following the receipt of an ICE NOI.