Form I-9 is not just another new-hire document

Since it was revised in 2016, the I-9 Employment Eligibility Verification form (Form I-9) has not been used by many contractors.

Yet Form I-9, considered a new-hire form, is fairly easy to complete and, more importantly, a critical piece of documentation.

Essentially, the form simply provides assurance to the appropriate agencies that newly hired workers hold citizenship or work authorization documents. While it is nine pages long (including instructions), only three pages are required to be completed and retained by the employer.

Enforcement and error classifications

Form I-9 enforcement activity is directed by the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations. Workforce enforcement usually begins with a Form I-9 inspection. The process is initiated by serving the employer with a notice of inspection, which requires the employer to produce its I-9 forms and additional supporting documents within three business days of the notice. 

It is important to understand that while ICE’s primary objective is to determine if the employer has knowingly hired or continues to employ undocumented workers, the inspection also determines if the Form I-9 was completed accurately and in a timely manner. Any administrative errors are classified in one of two categories: 

• Technical errors include failing to capture all the document information in sections 1, 2, or 3 of the form. Upon discovery of this category of errors, the employer is given 10 days to make corrections. 
• Substantive errors occur when an employer fails to prepare a Form I-9 in a timely manner. This could mean that a Form I-9 was never completed for the employee or wasn’t completed within three business days of the employee’s commencement of work. 

Penalties for non-compliance

In a recent ruling from the Department of Justice, a small business with no prior history of Form I-9 violations was penalized $25,525 for substantive errors. The company was found to have hired individuals who were authorized to work in the United States. However, the company failed to prepare I-9 forms within the three-day limit for 26 employees.  

Clearly, the cost of non-compliance can be significant. Civil penalties for substantive and uncorrected technical violations can run as much as $1,100. Additionally, ICE uses a scale referred to as an enhancement matrix that allows for penalties to be increased or decreased as a result of mitigating factors that include business size, good faith, the seriousness of the violation, and cumulative adjustment. These are in addition to penalties for knowingly hiring and continuing to employ unauthorized workers. It is crucial to note that individuals can face criminal charges for patterns or practices of knowingly hiring or continuing to employ unauthorized aliens—clearly, a position no organization or individual would want to be in.

Documentation and storage

It is important to remember that the employer representative certifying the examination of the documents on Form I-9 must examine original documents, not copies. The document must reasonably appear to be genuine and relate to the person presenting it.  

Employers should also understand that they cannot specify the document(s) the employee must present for the purpose of completing his or her Form I-9. Instead, employers must allow the employee to choose the documents to provide from the list of appropriate documents included in the Form I-9 instructions.  

Another challenge that employers face is the storage of Form I-9s. Only the pages in which the employee and employer enter data are required to be maintained. The U.S. Citizenship and Immigrations Services says I-9 forms can be maintained on paper, in microform, or electronically. The requirements for maintaining documents electronically are very specific and include control requirements for storage to prevent and detect unauthorized or accidental creation, additions, alterations, deletions, or deterioration of completed forms and an indexing system.  

Employers retaining paper I-9s may want to consider maintaining them separately from personnel files, not only to secure data from breaches that could result in identity theft but also for the ease of access in the event of an audit and for destruction.

I-9 forms have defined retention requirements. Employers should have a Form I-9 for every current employee hired since Nov. 6, 1986. After termination, employers are required to maintain the Form I-9 for either one year past the date of termination or three years past the date of hire, whichever is longer.  

Form I-9 audits 

It is critical that businesses engage in audits of their I-9 forms, practices, and retention obligations in advance of a visit from enforcement authorities. Employer audits can be self-performed or provided by consultants or attorneys. Additionally, staff responsible for the I-9 process should be provided training on an annual basis.  

ICE continues to make it clear that employer enforcement activity will continue. Employers need to be aware that even the most incidental error, such as entry of the wrong post office box or an incorrect or a missing date, can be costly.

Contractors with questions about the latest Form I-9 should contact their certified public accountant or human resources consultant. These professionals can review the documents to make sure the forms have been filled out properly, and can also help train company officials who will be responsible for them.

Published In: February 2017 Texas Contractor.