By: Bruce Buchanan, Sebelist Buchanan Law

In Chapter 6 of the book, The I-9 and E-Verify Handbook, Greg Siskind and I discuss “When does an Employer have Knowledge of Unlawful Immigration Status.” Here are excerpts from the upcoming Third Edition (to be published in 2021) of Chapter 6 from the book.

What if an employer knows an employee is not authorized to be employed even though the Form I-9 was properly completed?

An employer that knows the employee is not authorized to work, even though everything on the Form I-9 appears valid—is violating the Immigration Reform and Control Act (IRCA) because the employer is considered to have actual knowledge that an employee is not employment eligible. An employer that simply suspects an employee is ineligible to work should be extremely careful before terminating an employee, or even asking for additional documentation, unless the employer has a solid foundation for the belief. Taking an action after merely hearing from another employee that a particular employee is unauthorized to be in the United States is a recipe for a discrimination lawsuit because IRCA does not require employers to make inquiries under these circumstances. On the other hand, if an employee actually provides information to the employer regarding his or her immigration status, the employer would be considered to have knowledge. If the employer continues to employ this individual, it is a serious violation.

When would an employer be considered to have “constructive knowledge”?

The U.S. Department of Homeland Security (DHS) regulations hold employers liable not only when they have actual knowledge that an employee is unauthorized to work, but also when knowledge may be inferred through notice of certain facts that would “lead a person, through the exercise of reasonable care, to know about a certain condition.” CFR, Title 8, section 274a.1(e). This is called “constructive knowledge,” and DHS lists several examples in its rules
 The employer fails to complete or improperly completes the Form I-9.
 The employer has information that would indicate the alien is not authorized to work, such as a labor certification (this would generally apply only when an employee already was claiming to be a U.S. citizen or permanent resident on the Form I-9).
 The employer acts with reckless and wanton disregard for the legal consequences of permitting another individual to introduce an unauthorized employee into its workforce.
This list is not exhaustive, and employers also need to be cognizant of the anti-discrimination rules. In addition, failing to re-verify a Form I-9 requiring reverification usually will be considered constructive knowledge.
A more difficult situation has arisen in cases where an employer received a no-match letter from the Social Security Administration (SSA) regarding an employee whose name did not properly match up with the Social Security number (SSN) he or she provided. There are no clear rules on how much follow-up is required on the part of the employer. Many lawyers advise their clients not to terminate employees in no-match cases even if the employee declines to cooperate, given that the mismatch may be attributable to computer errors, typographical mistakes, or other issues. They argue the no-match letter states one should not be terminated on the basis of the no-match letter. Other attorneys have taken the position that an employee’s failure to resolve the problem after a reasonable period of time could be construed to provide constructive knowledge.

What if an employee later presents a different Social Security or “A” number from when the Form I-9 was completed?

Because a person is assigned only one SSN in his or her lifetime, an employee who comes to an employer with a number different from the one at the time of hire should be viewed with suspicion. The odds are that the employee used a false number to begin work and has somehow been able to obtain a valid SSN later (such as through a green card application filed independently of the employer).

The same principle normally applies with an “A” or “Alien number.” An employee normally has only one “Alien number.” The number does not change up-on renewal of Permanent Resident card or moving from Employment Authorization card to Permanent Resident card.

Employers will, of course, want to speak to employment counsel involving a violation of an employer’s policies regarding making false statements during the hiring process. With respect to IRCA, the employer should inquire regarding the circumstances surrounding obtaining the new number. However, the employer is not required to terminate the employee even if the employee admits making a false statement; and the employer would be able to continue employing the employee if the employer had no knowledge of the employee’s lack of work authorization. In this case, a new Form I-9 should be completed with the old Form I-9 attached with an explanation. The employer should correct the number with the Internal Revenue Service (IRS), so taxes are properly withheld.

However, if the employer has an honesty policy that states one can be terminated for materially lying on a company document and that policy has been followed, the employee must be terminated.

What if an employer receives an ICE notice that there is a problem with a document presented in connection with a Form I-9?

ICE requires an employer to take specific steps in a prescribed timeframe when it receives notification from ICE that a document presented by a worker for employment verification purposes is invalid, fraudulent, or cannot be authenticated. The main uncertainty surrounds how quickly an employer would need to respond and to what extent.

An employer that receives this type of notice (known as a Notice of Suspect Documents or NSD) would not violate the anti-discrimination rules of IRCA if it requests that an employee provide additional documentation. The courts have held ICE need not provide irrefutable proof that the employee is ineligible to work. It is enough that ICE provides information that arouses suspicion. As for timing, an employer must act within 10 days of ICE’s notice, although it is debatable as to what action the employee must take within 10 days. It may be that the employer must notify the suspect employee, or it may be that the employer must discharge the employee if he or she does not provide any new work authorization or ICE has rejected the new documents. Certainly, it must be reasonable under the circumstances.

When an employer follows up with an employee, the question also arises regarding what action must be taken. Clearly, the employer must provide the new documentation to ICE, which will determine the new documentation’s validity. What if the employee provides new, valid documentation that does not include the suspect document? In this case, the employer would have a defense against a later charge of knowingly employing an unauthorized employee.

Is an employer liable if it uses a contractor and knows the contractor’s employees are not authorized to work?

Yes. DHS regulations state that any person who uses a contract, subcontract, or exchange to obtain the labor or services of a foreign employee in the United States, knowing that the employee is unauthorized to work, should be considered to have hired the employee for purposes of determining if a person has violated IRCA.

May an employer be deemed to have constructive knowledge when it fails to re-verify a Form I-9?

Yes. Courts have found that an employer that fails to re-verify a Form I-9 when such re-verification is required will usually have constructive knowledge that an employee is unauthorized to work.