Labor - July 2008

Employee Verification:
Inexpensive Strategies for Compliance
By Jacob M. Monty

Employers only need to look at recent headlines to see that the Department of Homeland Security (DHS) Secretary Michael Chertoff is serious about enforcing the country’s immigration laws as he promised to do in August 2007. In the past year, Immigration and Customs Enforcement (ICE) publicly raided several companies, ranging from multinational corporations to smaller businesses, creating both legal and publicity nightmares for those companies. This year is no different. April was a busy month for ICE, with more than 400 publicized arrests resulting from worksite enforcement investigations. In the first 10 days of May, ICE made more than 100 additional arrests. No employer in any industry is safe from worksite enforcement investigations, including the car wash industry. However, there are inexpensive strategies employers can adopt to limit their liability in case of a worksite investigation.


The purpose of the new “no-match letter” is to notify employers of mismatches between the names and Social Security numbers (SSN) provided by their employees and the information in the Social Security Administration’s (SSA) database or notices from DHS that casts doubt on the employment eligibility of their employees. Receipt of a “no-match letter” calls into question the accuracy of the identifying information an employer received from and submitted for the employees.

DHS issued new regulations regarding the “no-match letter” in August 2007 that was immediately challenged. A federal judge in the Ninth Circuit issued a temporary injunction preventing DHS from implementing the “no-match letter” regulations and the mailing of the new type of no-match letters. In March 2008, DHS issued a supplemental proposed rule regarding the “no-match letters.” However, the supplemental proposed rule merely addressed the three grounds on which the district court based its injunction, and DHS is seeking an appeal of the injunction while standing behind their proposed “no-match letter” regulations.

DHS will use the receipt of the “no-match letter” by an employer to argue that the employer had constructive knowledge that employees referenced in the letter may not be authorized to work in the United States and impose civil and criminal penalties. Under the proposed new rule, employers who seek to remedy “no-match letters” are provided a safe harbor from future enforcement actions.


While the injunction is still pending, it does not prevent the mailing out of the old type of no-match letters that the SSA has been sending since 1996. DHS will continue to use the receipt of SSA “no-match letters” as proof of constructive knowledge that employers knowingly hired unauthorized workers. Employers should therefore create a “no-match letter” protocol to address current letters and to prepare for the new DHS regulations.

An employer’s “no-match letter” protocol should first determine how many letters have been received and resolve the issues accordingly. Additionally, pay special attention to no-match situations where the SSA has advised the company that the SSN in question actually corresponds to a dead person, infant, or retired person. These particular “no-match letters” require immediate attention. Lastly, the no-match protocol must at a minimum include some method of letting the affected employee know about the “no-match letter” in writing. Simply ignoring the letter is dangerous now and when the regulations become effective.


E-Verify (formerly known as Basic Pilot) is a free web-based program that allows employers to perform employment verification checks for all newly hired employees. By utilizing E-Verify, a company limits civil and criminal penalties for new employees who are run through E-Verify in good faith. The benefits of E-Verify are huge, and it is free. It is a great way to establish that your company is not an egregious employer and that you are taking every available step to stay in compliance.

In early May, DHS announced that more than 64,000 employers were participating in E-Verify, with approximately 1,000 new enrollments weekly. Right now, participation in E-Verify is voluntary, but several states have either mandated its use, or proposed laws requiring private employers to use E-verify. Members of the U.S. House of Representatives have also proposed legislation that would make E-Verify mandatory for all employers. It is therefore prudent for employers who want to minimize their liability to enroll in E-Verify now; it allows the employer to show a good faith effort in complying with immigration laws.

Simple System
The E-Verify system is simple to use. Once a newly hired employee presents documents demonstrating both identity and employment eligibility during the I-9 process, the employer has three days from the date of hire to perform an E-Verify check. Within three days of hire, the employer must input the information of the new employee, including the SSN, and E-Verify will either clear the employee for work or inform the employer of any issues. In case of the latter, the new hire must resolve issues with SSA within eight days. If there is a mismatch between the SSN and the new hire’s name or information, E-Verify puts the burden on the employee to correct that issue with SSA.

Opportunity to Correct
While E-Verify is not a perfect system, it does reduce the rate of mismatches between the SSN and the names of the new hires. A common problem that results in mismatches involves new hires who have become naturalized citizens. E-Verify will usually refer naturalized citizens to SSA as a mismatch; these individuals may have yet to update their records with SSA who still classifies them, for example, as a legal permanent resident. If an employer receives a mismatch from E-Verify, it is important to provide the employee an opportunity to correct this issue, as it may be a matter of having that employee update his or her records with SSA. To remedy this type of issue, DHS announced new improvements to increase the effectiveness of the overall program to reduce the mismatch rate for naturalized citizens and others who are authorized to work in the U.S.


Another way to comply with immigration laws and reduce potential liability is by using the new I-9 Form and developing an internal I-9 training program for personnel involved in the hiring process. All employees hired after November 6, 1986 must complete an I-9. The law requires employers to properly complete and retain the I-9 for each employee hired. Failure to comply with completing and retaining the I-9 can result in not only the prospect of hefty fines for the employer, but criminal prosecution as well. The government has argued in the past that by not properly completing an I-9, the employer had “constructive knowledge” of an employee’s ineligibility. In addition, if ICE decides to audit an employer’s facility and finds discrepancies with the I-9s, the employer is then exposed to audits for some, if not all, of its other facilities nationwide.

The best way to learn how to properly complete an I-9 is to download the M-274 handbook available through the CIS website ( The handbook also contains step-by-step instructions on completing the I-9 and instructions on how long an employer is required to keep documentation. The handbook also includes the new I-9 form and the new list of acceptable documents for establishing identity and employment eligibility that employers can photocopy and distribute to hiring personnel. There are illustrations of acceptable documents, and the handbook provides answers to more than 50 frequently asked questions.


Addressing the “no-match letter,” using E-Verify, and establishing a training program to properly fill out the I-9 form are just a few strategies employers can use to comply with immigration laws and reduce potential liability. Another inexpensive tool for immigration compliance is the ICE website ( Along with examples of immigration violations and hefty fines, ICE posts a Worksite Enforcement Advisory that informs employers of recurrent issues in worksite enforcement investigations and tips on how to avoid the employment of illegal workers. Employers can also conduct an internal audit of I-9s for current employees or hire an external auditing firm to assess the employer’s current compliance status.

Jacob M. Monty is managing partner of Monty Partners, LLP (, a Houston, TX law firm. Along with attorneys board certified in Labor and Employment Law by the Texas Board of Legal Specialization, Monty Partners retains the services of 40 retired ICE agents who work with the firm auditing employers throughout the country. Monty Partners, LLP is an employment, labor, and immigration law firm.


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