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Crack Down on Illegal Hiring

Author: R Stell Date: April 28, 2008

NFIB Won Concessions on New Rules

Tough new rules announced by the U.S. Department of Homeland Security will give employers 30 days to respond to a notice of a discrepancy regarding an employee's legal working status, or “no-match” letter. The rules are an attempt to crack down on businesses that employ illegal immigrants.

During the rulemaking process, we argued that DHS should allow small businesses to continue appealing a discrepancy if they miss the 30-day deadline (originally 14 days) for good reason. Most small businesses lack human resources departments or immigration expertise, which makes the quick turnaround burdensome and could lead to mistakes. DHS did adopt a safe-harbor provision that we supported, which will protect employers from penalties if they follow the procedures set forth in the new rule.

When you send an employee's W-2 form to the Social Security Administration, the employee's name and Social Security number are checked against SSA records. U.S. Immigration and Customs Enforcement will also verify the accuracy of information on I-9 forms. If either (or both) SSA or ICE can't verify employee information, a no-match letter will be sent to you, indicating that the employee's name or Social Security number didn't match government records. Employers then have 30 days to try to correct any errors.

If you get a no-match letter, you should avoid taking immediate action against your employee. A no-match letter simply says the employee's information didn't match government records, and it isn't necessarily an indication that the employee is ineligible to work in the United States. You must give the employee another 93 days to confirm that the information provided on the I-9 and W-2 is correct, and to make sure that no clerical errors were made.

If the discrepancy can't be explained, you'll have to terminate that employee. If you fail to do so, the government will assume you are knowingly employing illegal workers and may issue a fine of up to $10,000 per incident.

A copy of the rules can be found on the Homeland Security Web site. DHS has also announced that it will issue a proposed rule that would require all federal contractors to participate in the agency's electronic employment verification system.

*At press time, the AFL-CIO, the National Immigration Law Center and the American Civil Liberties Union had filed suit and a U.S. District judge had granted a temporary restraining order to stop implementation of these rules. Get the latest information at www.NFIB.com/issues.

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