By: Bruce E. Buchanan, Sebelist Buchanan Law



In United States v. Eriksmoen Cottages, Ltd., 14 OCAHO no. 1355a (July 15, 2020), OCAHO found the employer should be penalized $35,977.50 for its 30 substantive Form I-9 violations. In so doing, OCAHO only reduced the penalties by 2.5% from ICE’s proposed $36,900 penalty.

This was the penalties portion of litigation before OCAHO. Previously, on May 1, 2020, OCAHO, in U.S. v. Eriksmoen Cottages, Ltd., 14 OCAHO no. 1355, found six violations for failure to produce I-9 forms for the office staff and 24 violations for failure to properly ensure completion of Section 1 and/or failure to properly complete Section 2 or 3 Forms I-9. The only real issue concerned the failure to timely present I-9 forms for the six office staff employees. Eriksmoen Cottages asserted it mistakenly believed the Notice of Inspection exempted the office staff. When prompted by ICE, it presented the six Forms I-9 but in an untimely manner. Eriksmoen Cottages asserted these were timeliness failures, which OCAHO quickly dismissed as contrary to the law.

In the penalties stage of the case, Eriksmoen Cottages asserted penalties should be mitigated because of its good faith in responding to the investigation, its lack of a history of violations, no employment of undocumented workers, and the lack of seriousness of the violations. Concerning its good faith, OCAHO stated, “The primary focus of a good faith analysis is “on the steps the employer took before the investigation to reasonably ascertain what the law requires and the steps it took to follow the law.”” U.S. v. Executive Cleaning Servs. of Long Island Ltd., 13 OCAHO no. 1314, 3 (2018). In the case at bar, Respondent had not properly completed 71% of its Forms I-9. OCAHO found that although it is clear that “a low compliance rate, alone, does not warrant a finding of bad faith” U.S. v. Farias Enterprises LLC, 13 OCAHO no. 1338, 4 (2020), OCAHO precedent is silent on whether a high compliance rate warrants a finding of good faith. OCAHO found, “[A] high compliance rate could be evidence of good faith, but in this case, the remaining violations demonstrated some persistent problems with the Respondent’s compliance program, in particular with reverification requirements.”

Concerning Eriksmoen Cottages’ assertion that the penalties should be mitigated because of its lack of a history of violations and employing no undocumented workers, OCAHO disagreed. Instead, OCAHO found these were neutral factors and stated, “compliance with the law is the expectation, not the exception.”

Eriksmoen Cottages’ assertion that the failure to present the Forms I-9 were not serious and should be mitigated was a stretch of the imagination. OCAHO found Respondent’s violations were serious but treated the six failure to present violations as less serious under the circumstances in this case. Thus, the aggravation of the penalties remained with a deduction of 2.5%. Unsure where OCAHO came up with that number.

Finally, OCAHO declined to follow Eriksmoen Cottages’ position that the penalty should be mitigated due to the economic hardships that the company is currently facing due to the Coronavirus pandemic. OCAHO stated the company failed to provide any evidence of its financial state, beyond its own statements; thus, the argument failed.

If you want to know more information on I-9 compliance and related issues, I recommend you read The I-9 and E-Verify Handbook, a book I co-authored with Greg Siskind, and available at http://www.amazon.com/dp/0997083379.