1. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. IMMIGRATION ISSUES FACING EMPLOYERS Presented by Laura Deddish Burton Certified Immigration Law Specialist Smith Moore Leatherwood, LLP Telephone: 336-378-5566 Laura.Burton@smithmoorelaw.com

2. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. DHS Worksite Enforcement Strategy “When we find those employers who don’t want to do the right thing we’re going to target our criminal efforts and bring all the criminal statutes that we can to bear against them” John Morton – ICE Director “We want to send the message that your cost of business just went up because you risk your livelihood, your corporate reputation, and your personal freedom” Brian Moskowitz, ICE Special Agent in Charge

3. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. DHS Worksite Enforcement Strategy: Why I-9 Compliance is critical Targets employers, not just workers Targets all sizes of employers

4. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Basic I-9 Concept  Keep in mind two goals: To make sure Employers only hire people who are authorized to work in the US (screen out unauthorized workers). To make sure Employers do not discriminate against people based upon foreign origin (name, appearance, accent) when hiring.

5. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Why Worry About I-9 Compliance? Significant Potential Penalties for 4 Types of Violations

6. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Civil Penalties Knowingly hiring or continuing to employ an unauthorized worker –1st Offense: $275-$2,200 per individual –2nd Offense: $2,200-$5,500 per individual –3rd or Later Offense: $3,300-$5,500 per individual –Additional criminal penalties for “pattern and practice”

7. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Civil Penalties Discrimination on the basis of national origin or citizenship status: –1st Offense: $275-$2,200 per individual –2nd Offense: $2,200-$5,500 per individual –3rd or Later Offense: $3,300-$11,000 per individual –Additional remedies include back pay, injunctive relief and attorney’s fees

8. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Civil Penalties Paperwork violations: failing to properly complete I-9s or overdocumentation (for requesting too many documents): –$110-$1,100 per individual (for each incorrect form) –10-day “cure” period for some violations

9. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Civil Penalties Document fraud for knowingly accepting a forged document: –1st Offense: $275-$2,200 –Later Offenses: $2,200-$5,500 –Additional criminal penalties

10. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Criminal Penalties Pattern or practice of knowingly hiring or continuing to employ undocumented workers: –$3,000 fine and/or 6 months in prison Document fraud/false statement: –fine and/or up to 5 years in prison

11. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Criminal Penalties For Failing To Comply with I-9 Requirements Harboring of undocumented foreign national: (actual knowledge that a person has come to or remains in US in violation of law and harboring or concealing said person from detection) –5 years in prison; 10 years if there is financial gain Other penalties: – Asset and/or property seizure; fines up to $250,000 for “conspiring to harbor”; disbarment from participation in Federal Procurement programs.

12. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Who Can Be Charged Criminally? Plant managers and supervisors Human Resources personnel Union Stewards Corporate Officials (owners and executives) Accountants Anyone involved

13. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Implementing An I-9 Compliance Plan To implement an I-9 Compliance Plan, the company should follow 3 basic steps: –Adopt an I-9 Policy and Procedure Plan with clear step- by-step instructions for completing the I-9 forms; –Appoint one company representative to serve as the I-9 Supervisor, plus a local I-9 administrator at each office or job location; –Have outside counsel perform an I-9 audit to catch errors and correct compliance procedures.

14. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. I-9 SUPERVISOR: The I-9 Supervisor should: –Have a policy and procedure for I-9 verification; –Train the local I-9 administrators; –Check the I-9 forms; –Maintain a tickler system to ensure that reverification occurs when appropriate.

15. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. I-9 SUPERVISOR: The I-9 Supervisor should: –Ensure that the I-9 forms are maintained for the proper length of time; –Resolve questions or problems for the local administrators; and –Consult with legal counsel when any issues arise.

16. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. I-9 ADMINISTRATORS: Local I-9 Administrators Are Responsible For The Completion Of All I-9 Forms For Employees At Their Office Or Job Location. The Local I-9 Administrators should: –Follow company policy and procedure instructions when completing the I-9 forms; –Call the I-9 Supervisor when questions or problems arise; and –Refer all work authorization expiration dates to the I-9 Supervisor for inclusion in the tickler system.

17. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. I-9 Changes (2009): Must use current Form I-9 (2/2/2009 or 8/7/2009 only) All documents presented by an employee must be unexpired on the date presented (including U.S. passports and List B documents such as driver’s licenses) Section 1 – A new box has been added for an employee to self-identify: “A non-citizen National of the United States.” (separated from first box)

18. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. I-9 Changes: Section 2 -- Changes to List A documents (documents that may be used to prove both identity and work authorization) : –U. S. Passport must be unexpired –Adds new U.S. Passport card as acceptable document –Only I-766 Employment Authorization Document acceptable (Old cards I-688, I-688A and I-688B are no longer acceptable)

19. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. List A Documents Changes to List A documents (documents that may be used to prove both identity and work authorization): - Adds Foreign Passport with machine-readable immigrant visa documentation (I-551) -Adds documentation (passport and I-94 card) for citizens of the Federated States of Micronesia and the Republic of the Marshall Islands

20. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. List A Documents Changes to List A documents (documents that may be used to prove both identity and work authorization): -Unexpired foreign passport with attached I-94 card for nonimmigrant aliens authorized to work for a specific employer (language is clarified on form).

21. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. The new I-9 form should be used on a going forward basis and does not need to be completed for existing employees. New I-9 Form

22. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. The new I-9 instructions specifically state that the employee is NOT required to provide a Social Security Number in Section 1, UNLESS the employer participates in the E- Verify program. New I-9 Form

23. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Basic Four Step Process For Completing I-9 Forms Employee completes §1 by the end of the first day of employment. By the end of the third day of employment, employer reviews employee ’ s documents to verify identity and work authorization and completes §2. If employee ’ s work authorization expires, put expiration date in tickler system. Reverify before work authorization expires.

24. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Step 1: Employee Completes §1 Make sure all information is completed and proper box is checked. Check the employee ’ s written Social Security number for legibility, but do not ask for Social Security card. Complete an I-9 for all employees. The employee must complete §1 on or before the first day of work. The employee may use a translator, but the employee should still sign and date §1.

25. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Step 2: Employer Obtains And Examines Acceptable Documents By Day 3 Obtain one document from List A OR one from List B AND one from List C. Let the employee choose the documents. Avoid overdocumentation. Suspend the employee if the documents are not received by Day 3. A receipt for a replacement document is acceptable.

26. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Step 2: Employer Obtains And Examines Acceptable Documents By Day 3 Examine documents for authenticity. Photocopy documents based on company policy. Verification of Social Security numbers allowed if based on consistent policy. Employer representative completes § 2, including signature and date. Retain I-9 forms in separate files for current and former employees.

27. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Step 3: Create A Tickler System Enter work authorization in tickler system. Remind employee 90-120 days in advance of expiration. Do not reverify identity documents or lawful permanent resident cards.

28. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Step 4: Reverify Just reverify work authorization, not identity. Accept any combination of documents: List A OR List B AND C. Complete §3.

29. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Retention Requirements An employee’s I-9 form must be retained for the full period of employment. Once employment ends, the I-9 must be retained for the longer of: –One year from the date of termination OR –A total of three years from the date of hire.

30. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. What Puts A Company At Risk of Investigation: I-9 Forms completed without attention to detail. Management reluctant to question authenticity of I-9 documents to obtain needed workers. Management allows employers to present new inconsistent documentation without further inquiry. Receipt of Social Security “No match” letters without investigation or response.

31. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. What Puts A Company At Risk of Investigation: Management does not address rumors/complaints of unauthorized workers. Pool of new hires comes mainly from existing workforce, including friends/relatives. Company ignores communications from agencies (workers’ comp, ESC) that employee information is not valid or that rightful owner of SSN is having problems because company’s employee is using the information.

32. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Handling An ICE Investigation Assign someone specific to speak with ICE officer. Ask for 3 days notice to prepare for audit. Call your attorney immediately.

33. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Handling An ICE Investigation Determine what ICE is investigating and what documents are requested (often payroll reports, employee rosters, and monthly wage statements, in addition to I-9s). Review the I-9 forms with counsel during the 3-day notice period. Don’t provide more information than required. Pay attention to potential aggravating and mitigating factors before the audit. Negotiate fines through counsel if possible.

34. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Handling Information That An Employee May Be Illegal Special Situations May Arise If: –The employer hears rumors that an employee is not authorized to work in the U.S. –An employee presents a new Social Security number or new name. –The employee asks that the company sponsor him or her for permanent residency (if green card previously provided for I-9). –The employer receives a “No Match” letter from Social Security Administration.

35. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Social Security Administration “No-Match” Letter* Check that the number in letter matches number on file. Ask employee if number is correct. If clerical error, note it on I-9. Do NOT take adverse action against employee or state that employee is illegal. Provide employee time to clear matter up with local Social Security Office – do not suspend employee. *currently not being issued.

36. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Social Security Administration “No-Match” Letter Request that employee inform you that matter has been resolved within fixed period. If not resolved, may suspend employee until resolved with Social Security Administration or terminate employment. Document each step of the procedure and maintain a file for each matter.

37. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-VERIFY : (EMPLOYMENT ELIGIBILITY VERIFICATION PROGRAM)

38. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-verify Voluntary online verification of employment eligibility Participation requires Memorandum of Understanding with ICE Currently free to use

39. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-verify 92% of queries receive instant verification Non-citizen work authorization status mismatches to be resolved by USCIS staff Currently 200,000 employers use E-verify (out of approximately 6 million). Photo ID tool included (9/2010 – US Passport photos added to database). US Drivers License photos to be added in 2011.

40. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-verify Cannot use as a pre-screening tool. Only used for new hires (except federal contractor provision) and must verify within 3 days of hiring. If participating in E-Verify program, must use for all new hires. Any List B document must include a photo.

41. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-verify Cannot use for employees hired before employer joins program (except federal contractors provision). Cannot use for reverification, with some exceptions. Offers rebuttable presumption that employment is authorized. Must photocopy Permanent Resident Cards and/or Employment Authorization Documents if participating in program, even if company does not otherwise photocopy.

42. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-verify For Federal Contractors Under Federal Acquisition Regulation (FAR): Federal contractor provision to be inserted in many memoranda of understanding for organizations that do business with U.S. government. Check contracts for provision.

43. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Federal Contractors Who qualifies: Businesses with a contract with federal government agency. Required for all contracts over $100,000 and/or lasting more than 120 days. Exceptions for commercially available off-the-shelf items (COTS) (Most food and agricultural products). Provision applies to subcontractors providing services or construction over $3,000. Must enroll in E-Verify within 30 days of entering contract.

44. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Federal Contractors Must agree to use E-Verify for all new hires. Must agree to use E-Verify for all existing employees working on the federal contract. May choose to verify all existing employees (different from standard E-Verify program). Exception for institutions of higher education, state/local governments, and governments of federally recognized Indian tribes – do not have to verify all new hires. Required verification inquiries must be initiated within 90 days of enrollment.

45. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. E-verify, Including Federal Contractors I-9 Differences: –Employee must provide Social Security number; –List B document provided must have a photograph; –If employee provides I-551 (“Permanent Resident Card”) or I-766 (Employment Authorization Document), the employer must photocopy the document and keep it with Form I-9.

46. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. ICE Image Program Employer signs agreement with DHS. Memorandum of Understanding required. Employer agrees to initial ICE I-9 audit. Employer agrees to use the E-Verify Program for new hires.

47. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. ICE Image Program Employer agrees to implement ICE best hiring practices. Employer agrees to training programs. Employer establishes anonymous tip line for employees to report violations. Employer makes annual self-report of problems to ICE. Employer agrees to let ICE on premises at any time to review employer records. 68 Employers are currently enrolled.

48. © 2010 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Why Conduct An Audit? Audits allow the employer to correct problems and avoid ICE penalties. Audits and training are a factor that may result in mitigation of fines and penalties. An audit shows good faith compliance, which can serve as a defense. An internal audit is easier than an ICE-provoked review. An audit can reveal areas for future training and correction.