What is E-Verify and Does it Apply to My Contract? New Rules For Federal Contractors
November 19, 2008
Effective January 15, 2009, the Federal Government will require federal contractors and subcontractors to use E-Verify to verify the work status of employees who work on prime federal contracts valued at over $100,000 with a performance period of 120 days or more, and subcontracts under a covered prime contract valued at over $3,000. E-Verify is an internet based program operated by the Department of Homeland Security (“DHS”) in partnership with the Social Security Administration (“SSA”). The system enables employers to check the work status of new hires online by comparing information from an employee’s Form I-9 against SSA and DHS databases. (For a recent CNN story on requirement, see this video clip.)
Federal contractors who are not already enrolled in E-Verify will be required to enroll within 30 days of contract award. Within 90 days following enrollment, contractors must begin to use E-Verify to confirm employment eligibility of (a) all new hires within 3 business days after the date of hire, and (b) all existing employees assigned to the contract (or, if later, within 30 days after assignment to the contract). Contractors who are already enrolled must use E-Verify (a) within 90 days after enrollment to confirm the employment eligibility of new hires within 3 business days after the date of hire, and (b) to confirm the employment eligibility of existing employees assigned to the Federal contract within the later of 90 days following contract award or 30 days following assignment to the contract.
Federal contractors may register early at http://www.uscis.gov/E-verify. The 90-day phase-in period will begin to run from the date of early enrollment, however. Contractors will be required to sign a Memorandum of Understanding (“MOU”) with Department of Homeland Security (“DHS”). Once this is completed, the person specified by the employer or employer worksite as its designated agent can register to use E-Verify and obtain passwords for access by permitted users.
The final version of the MOU is not yet available. The proposed MOU is lengthy and requires (among other things) that the employer agree to permit a DHS audit of I-9s and to ongoing DHS audits and interviews with personnel and employees to assess the effectiveness of the E-Verify program. Compliance with the terms of the MOU is a performance requirement of the Federal contract and creates significant legal obligations for the employer.
New and Additional Duties for Covered Federal Contractors and Subcontractors
Subject to the phase-in periods noted above, Federal contractors are now required to take the following additional steps to confirm employment authorization. (1) For each new employee, the employer must complete an I-9 within the first three days of employment. (2) After the I-9 is completed, an E-Verify user must submit information directly from the completed I-9. Each existing employee assigned to the contract whose work eligibility has not been previously confirmed through E-Verify must undergo verification within 30 days following assignment.
Initial verification will return one of three results:
If DHS does not find the employee to be employment authorized, the employer must terminate the employee, or risk a finding that it is knowingly employing an unauthorized worker. When an employer receives a final non-confirmation, it must inform DHS via E-Verify if it continues to employ a person after receipt of a Final Non-Confirmation. The employer is subject to monetary penalty for failure to notify DHS (up to $1,000), and is subject to a rebuttable presumption that it has knowingly employed an unauthorized alien.
Other Important E-Verify Details
Employers must be certified and trained in how to use the E-Verify program. Certification requires completion of a tutorial with DHS and completing refresher training as new features are introduced.
An employer may not take any adverse action against an employee during the appeal process, unless it obtains independent knowledge that the person lacks work authorization.
Employers must allow DHS and SSA to make periodic visits to review E-Verify related records and to interview employees hired during E-Verify about their experience. Employers must make other employment records available as requested by DHS and SSA.
Employers must still complete and maintain I-9 forms for all employees and conduct re-verification as necessary.
The prime contractor is responsible for “flowdown” of E-Verify contractual clauses to subcontractors and for ensuring subcontractor compliance as a performance requirement.
This bulletin summarizes a very lengthy regulation. Taft attorneys in the immigration and federal contracts practice areas are available to consult for further details.
Federal contractors who are not already enrolled in E-Verify will be required to enroll within 30 days of contract award. Within 90 days following enrollment, contractors must begin to use E-Verify to confirm employment eligibility of (a) all new hires within 3 business days after the date of hire, and (b) all existing employees assigned to the contract (or, if later, within 30 days after assignment to the contract). Contractors who are already enrolled must use E-Verify (a) within 90 days after enrollment to confirm the employment eligibility of new hires within 3 business days after the date of hire, and (b) to confirm the employment eligibility of existing employees assigned to the Federal contract within the later of 90 days following contract award or 30 days following assignment to the contract.
Federal contractors may register early at http://www.uscis.gov/E-verify. The 90-day phase-in period will begin to run from the date of early enrollment, however. Contractors will be required to sign a Memorandum of Understanding (“MOU”) with Department of Homeland Security (“DHS”). Once this is completed, the person specified by the employer or employer worksite as its designated agent can register to use E-Verify and obtain passwords for access by permitted users.
The final version of the MOU is not yet available. The proposed MOU is lengthy and requires (among other things) that the employer agree to permit a DHS audit of I-9s and to ongoing DHS audits and interviews with personnel and employees to assess the effectiveness of the E-Verify program. Compliance with the terms of the MOU is a performance requirement of the Federal contract and creates significant legal obligations for the employer.
New and Additional Duties for Covered Federal Contractors and Subcontractors
Subject to the phase-in periods noted above, Federal contractors are now required to take the following additional steps to confirm employment authorization. (1) For each new employee, the employer must complete an I-9 within the first three days of employment. (2) After the I-9 is completed, an E-Verify user must submit information directly from the completed I-9. Each existing employee assigned to the contract whose work eligibility has not been previously confirmed through E-Verify must undergo verification within 30 days following assignment.
Initial verification will return one of three results:
- Employment Authorized. If authorized, the employer must record the system generated verification number on the I-9, OR print the screen with the transaction number and store it with the I-9;
- SSA Tentative Non-Confirmation (information mismatch with SSA). The employer must print the non-confirmation notice, review it with the employee, and inform the employee of the right to contest it. Both parties should sign the notice. The employee must contact DHS and/or SSA within 8 business days to contest the finding. The Agency will update its system within 2 business days, unless additional time is deemed necessary. The employer must carefully follow the obligations related to the Tentative Non-Confirmation process to initiate a 10 day appeal process.
- DHS Verification in Process. The employer will usually within 24 hours receive notice of employment authorization or DHS Tentative Non-Confirmation)
If DHS does not find the employee to be employment authorized, the employer must terminate the employee, or risk a finding that it is knowingly employing an unauthorized worker. When an employer receives a final non-confirmation, it must inform DHS via E-Verify if it continues to employ a person after receipt of a Final Non-Confirmation. The employer is subject to monetary penalty for failure to notify DHS (up to $1,000), and is subject to a rebuttable presumption that it has knowingly employed an unauthorized alien.
Other Important E-Verify Details
Employers must be certified and trained in how to use the E-Verify program. Certification requires completion of a tutorial with DHS and completing refresher training as new features are introduced.
An employer may not take any adverse action against an employee during the appeal process, unless it obtains independent knowledge that the person lacks work authorization.
Employers must allow DHS and SSA to make periodic visits to review E-Verify related records and to interview employees hired during E-Verify about their experience. Employers must make other employment records available as requested by DHS and SSA.
Employers must still complete and maintain I-9 forms for all employees and conduct re-verification as necessary.
The prime contractor is responsible for “flowdown” of E-Verify contractual clauses to subcontractors and for ensuring subcontractor compliance as a performance requirement.
This bulletin summarizes a very lengthy regulation. Taft attorneys in the immigration and federal contracts practice areas are available to consult for further details.
