Employment Law
DECEMBER 2003
Illegal Employment of Aliens
Wal-Mart! Tyson Foods! These names are well known
to the American public as a major retailer and a major
food supplier. Recently, however, their names became
associated with federal government allegations of hiring
illegal aliens. Are these public attacks simply aberrations,
or should every employer be worried about being pursued by the federal government for hiring illegal aliens?
The answer to this question lies somewhere between these
extremes.
Employers need to be concerned about this question because of the Immigration Reform and Control Act of 1986
(“IRCA”), 8 USC 1324a, et seq. At that time, Congress
was becoming increasingly concerned about the flow of
illegal immigrants into the United States, with their perceived effect on loss of job opportunities to Americans
and social and economic problems caused by the illegals.
On the theory that the attraction to the United States was
the opportunity to obtain employment, Congress felt that
if the employment opportunities were cut off, the flow
would be reduced. Others in Congress, however, were
concerned that any legislation of this type could result in
discrimination against persons legally entitled to work in
the United States, but who were foreign born, spoke with
an accent, or were otherwise deemed or perceived to be
“foreign.” The result of these conflicting concerns was
IRCA, which prohibits employers from employing aliens
who are not legally permitted to work in the United States;
which requires employers to obtain and retain proof that
their employees, including United States citizens, are
authorized to work in the United States; and which imposes additional nondiscrimination obligations and
procedures on employers. A fourth provision, a process
by which long-term resident illegals could obtain legal
status, is beyond the scope of this article.
PROHIBITION
IRCA prohibits an employer from knowingly hiring an
alien1 who is not authorized to work in the United States
or from continuing to employ an alien who was authorized to work at the time of employment but subsequently
loses that authorization. Implicit in this prohibition is the
fact that some aliens are legally permitted to work or are
at least legally permitted to work for a particular employer.
On first glance, the prohibition appears reasonably
straightforward: An employer may not employ an alien
whom the employer knows is not authorized to work
for the employer. Rarely, however, is the issue that
straightforward. An alien applying for a job is not likely
to tell the prospective employer that he or she cannot
work legally.
An employer knowingly hires someone not authorized
to work not only when the employer has actual knowledge that the alien is not authorized to work, but also
when the employer has constructive knowledge that may
be fairly inferred through awareness of facts and circumstances that would lead a person by use of reasonable
care to know that the alien is not authorized to work.
Application of this concept may be difficult depending
upon the factual situation.
1 An alien is any person not a citizen or national of the United States.
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Several other issues are presented by the knowing requirement. Constructive knowledge may be inferred from the
failure by the employer to comply with the verification
requirements discussed below. On the other hand, knowledge may not be inferred from foreign appearance or
accent of the prospective employee.
VERIFICATION
The I-9! Hopefully, every reader is familiar with the I-9.
This is the form which employers are required to fill out
at the time of hiring all employees, including American
citizens, in order to verify that the individual is authorized to work in the United States. The details of filling
out the I-9 and the documents which may be required are
set forth in the instructions to the I-9 and those details
will not be discussed here. There are, however, a number
of points which do need to be emphasized about the I-9
and the verification obligation:
1. Complying with the I-9 verification procedure is a
separate obligation from complying with the prohibition against hiring aliens not authorized to work, and
a violation of the verification obligation can occur even
if the employee involved is a U.S. citizen or is an alien
authorized to work for that employer.
2. An employer complies with the verification obligation if the documents presented by the prospective
employee on their face appear to be genuine, and, conversely, an employer may not reject proffered
documents as evidence if the documents on their face
appear to be genuine. Moreover, the employer may
not require additional documents over and above those
which the I-9 instructions specify.
3. Documents presented may but need not be copied.
However, copying only documents provided by individuals of certain nationalities or who are perceived
to be “foreign” may be discrimination.
4. The I-9 form must be completed, with limited exceptions, within three (3) days of the time of hire and
must be retained to the later of (a) three years after the
date of hire, or (b) one year after the individual’s employment has terminated.
2
5. An employer will be deemed to be in compliance with
the verification process if there is a good-faith attempt
to comply despite a technical or procedural failure.
Several other points should be noted. First, an employer
need not renew the verification of an employee who temporarily ceases work but has a reasonable expectation of
recall. Second, an employee who transfers to a different
location or unit of the same employer need not be reverified if the new work is still within the authorized
employment of an employee who has limited work authorization. Third, a related, successor or reorganized
employer need not reverify. Fourth, if a former employee
is rehired within three years of the date of the initial I-9
and the employer verifies that employment is still authorized, the old I-9 form may be used if the rehire is noted
on it.
The I-9s may be inspected by the U.S. Department of
Labor or various immigration agencies under the Department of Homeland Security. The agency must give three
business days’ notice of inspection, no subpoena or search
warrant is required, and the I-9 forms (original or film)
must be made available either at the location where the
notice is given or at another location specified to the government agency.
SOCIAL SECURITY MISMATCH LETTER
Receipt of a mismatch letter from the Social Security
Administration can cause great concern to an employer.
False social security cards are easily obtained and used
for employment authorization verification. Unrelated to
IRCA, employers have an obligation under federal social
security and tax laws to provide accurate social security
numbers to the government. If the names and numbers
do not match, the agency records are distorted. The result is 750,000 annual “Code V” or mismatch letters to
employers. These letters notify the employer that information submitted about an employee’s social security
number does not match the data in the government’s
records.
The mismatch letters contain the following suggestions
to resolve the issue. First, the W-2 information should be
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compared with employment records. There may simply
have been a clerical error in the information provided to
the government. Next, if the number given by the employee and the number on the W-2 match, ask the
employee to confirm the employee’s social security number. Finally, if the matter cannot then be resolved, the
employer should suggest that the employee contact the
social security office to resolve the issue.
PENALTIES
An employer may be subject to the following penalties
for violation of various portions of IRCA:
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What the letter does not say is what the employer can or
should do if the conflict is not resolved. The letter does,
however, state what the employer cannot do. The letter
specifically states that the mismatch is not a basis for firing an employee, is not a determination about the
immigration status of an employee, and does not mean
the employee is not authorized to work. Furthermore,
the letter warns against discrimination.
If the conflict in the social security number is not resolved,
the employer is in a bind. First, the employer has no
general access to immigration records to verify work authorization, although legislation has been proposed which
would allow employers access to immigration records.
Second, an employer can be subject to fines under the
Internal Revenue Code for failure to provide accurate
information. Third, the employer risks charges of discrimination if it fires the employee and the employee is
in fact authorized to work.
The employer is thus in a conflict between a risk of “knowing” employment of an illegal and the prohibition against
refusing to honor facially valid documents. Unfortunately,
the immigration services to date have been equivocal on
whether a knowing violation can be based simply on a
mismatch, although the author is unaware of any instance
in which an employer was penalized based solely on a
mismatch. Fortunately, in early October, the Internal
Revenue Service stated that an employer relying in good
faith on the social security number provided by an employee on Form W-4 and using that social security number
on the Form W-2 will not be subjected to tax penalties
for filing inaccurate information. This position removes
a threat of penalty under the tax laws, but does not eliminate the quandary under IRCA.
DECEMBER 2003
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For a pattern or practice of knowingly hiring illegals,
an employer may face criminal penalties of up to
$3,000.00 per illegal, imprisonment for not more than
six months for the entire pattern or practice, or both.
For knowingly hiring illegals, the employer may be
civilly fined anywhere from $275.00 to $11,000.00
per individual, depending upon the number of offenses
the employer has committed.
For violation of the verification requirements, an employer may be fined anywhere from $110.00 to
$1,100.00 for each improper individual verification,
with the amount of fine to be determined by considering the size of the employer, the employer’s good faith,
the seriousness of the violation, whether the employee
was in fact unauthorized to work, and the history of
previous violations.
DISCRIMINATION PROHIBITIONS
Employers are generally aware of various federal and state
laws which prohibit discrimination based on race, sex,
national origin and a panoply of other categories. Employers may not, however, be aware of the prohibitions
on discrimination contained in IRCA. While they are of
somewhat limited application, a violation of these nondiscrimination provisions can result in monetary exposure
to the employer.
Under IRCA, an employer is prohibited from discriminating in hiring or firing a person who is authorized to
work if that action is based upon that individual’s national original or because of such individual’s citizenship
status if the individual is 1) a citizen or national of the
United States, 2) is an alien lawfully admitted for permanent residence, or 3) is an alien authorized to work under
other provisions of the immigration laws. Employers with
four or more employees at the time of discrimination are
covered by the prohibitions, except that the national origin discrimination prohibitions do not apply to any
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employer covered by Title VII of the 1964 Civil Rights
Act. Title VII prohibits discrimination on the basis of
national origin by employers with 15 or more employees, and Congress did not want to subject employers to
overlapping prohibitions and procedures.
in the United States, and to the obligation to comply with
the employment verification process. Employers who
attempt to comply in good faith with the verification processes are not likely to run afoul of the prohibitions.
However, failure to comply may result in monetary penalties or, in extreme cases, criminal penalties.
CONCLUSION
Every employer, no matter how small, is subject to the
prohibition against hiring persons not authorized to work
HAYES C. STOVER
hstover@kl.com
412.355.6476
FOR MORE INFORMATION, please contact one of the following K&L lawyers:
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Stephen M. Olson
412.355.6496
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412.355.6275
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412.355.6476
hstover@kl.com
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Lawrence C. Lanpher
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ALL RIGHTS RESERVED.