All U.S. employers must comply with employment eligibility verification requirements set forth in the Immigration Reform and Control Act (IRCA) of 1986, more familiarly known as the Form I-9 process. During this process, all employees on or before their first day of employment must complete Section 1 of the Form I-9, providing basic biographic information and information about their immigration status and authorization to work in the U.S.; all employers on or by the third day after the employee’s first day of employment must verify that employee’s identity and employment eligibility by physically inspecting certain documents the employee may choose from 3 lists of acceptable documents, and the employer must then complete Section 2 of the Form I-9. Worksite enforcement activity – including Form I-9 compliance investigations, often called “I-9 Audits,” by Homeland Security Investigations (HSI, a division of U.S. Immigration and Customs Enforcement (ICE)) – has increased dramatically over the past few years (340% increase in I-9 investigations between 2017 and 2018), and we expect that the number of worksite investigations will continue to grow in parallel with the administration’s focus on unauthorized workers. Forms I-9 and other company documentation related to employment eligibility compliance must be presented to HSI officials upon request during an “I-9 Audit,” and HSI often will ask whether the employer has received any correspondence from the Social Security Administration (SSA) regarding its employees’ earnings records, including “No-Match” letters. Failure to comply with the Form I-9 employment eligibility verification process can result in fines ranging from $230-$2300 per violation, with additional penalties – and even criminal sanctions – for “knowing” (which includes both “actual” and “constructive” knowledge) and continued employment of individuals unauthorized to work in the U.S.
Historically, the SSA has issued letters notifying employers when its social security number records do not match the names or birthdates of employees reported to have earned wages in the prior tax year. The stated purpose of these “No Match” letters has been to ensure accuracy: that the employer’s reported earnings information is correct so that the employee receives the proper credit towards future benefits. For many years, the SSA only issued No Match letters where information was mismatched on more than 10% of the employer’s reported employees’ (and more than 10 employees); however, in March 2019, the SSA began issuing No Match letters to employers with even only one employee information mismatch in the prior tax year. More than 570,000 “No Match” letters were issued in March and April 2019, and another wave of letters is expected this fall. To date, the SSA has not taken action if an employer fails to respond with corrections or updates to the mismatched information, and (again, to date) there are no “SSA-related consequences” for employers’ noncompliance with the No Match letters’ requests for such corrections and updates, yet noncompliance may have other, non-SSA consequences, in spite of SSA’s strict confidentiality practices regarding No Match information.
Receipt of a No Match letter, standing alone, cannot create liability for an employer in terms of employment eligibility verification – there could be many reasons an employee’s SSN and name or birthdate do not match, including simple errors in transposing numbers or spelling or punctuation of an individual’s name. However, the immediate next steps taken by the employer to verify and correct any SSA mismatched information are key in the I-9 Audit context, because HSI routinely requests whether the employer has received a No Match letter, in an effort to determine whether the employer has continued to employ individuals it knows to be unauthorized to work in the U.S., which knowledge can subject the employer to increased fines and even criminal sanctions. An employer that has received a SSA No Match letter, or a Notice of Inspection or Subpoena for I-9 records from HSI, may wish to contact employment and/or immigration counsel to determine how best to respond.