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I-9 Compliance is Essential to Avoid Costly Fines

Wednesday, September 8, 2021

Question: What is an I-9 form used for? Why am I as an employer responsible to complete it every time I hire an employee?

Answer: The Biden Administration recently announced plans to increase enforcement of workplace laws. This occurs as many companies are returning to the office and resuming hiring. Now is the time to ensure your medical practice is in compliance with the often used but seldom understood Form I-9.

The federal Immigration Reform and Control Act (the “Act”) requires employers to verify the identity and employment eligibility of all those individuals they hire. The Employment Eligibility Verification Form I-9 was designated as the means of documenting this employer verification. Employers are required by law to complete, retain and produce for inspection original Form I-9s for all their current employees. Employers are also required to retain Form I-9s for all former employees for a period of at least 3 years from their date of hire or for 1 year after the employee is no longer employed, whichever is longer.

Form I-9 has 3 sections that must be completed and signed within a required time period:

Section 1 – must be completed and signed/dated by the Employee no later than the first day of employment, but not before accepting a job offered.

Section 2 – must be completed and signed by the Employer or authorized representative within three business days of an employee’s first day of employment.

For verification purposes an employer must physically examine:

  • one original document from List A (the Lists are attached to the I-9 instructions); or
  • a combination of one original document from List B and one original document from List C.

Section 3 – should only be completed and signed by the Employer or authorized representative if there is a need to reverify documents and/or rehire an employee.

The Act provides for civil penalties for substantive/uncorrected technical paperwork violations range from $234 to $2,332 per violation, while fines for knowingly hiring or continuing to employ unauthorized workers range from $583 to $4,667 per violation. For substantive/uncorrected technical paperwork violations, the amount of the fine is determined by dividing the number of violations by the number of employees for which an I-9 should have been prepared to obtain a violation percentage. This percentage provides the auditor with a base fine amount depending on 1st time offense, 2nd time offense, or 3rd or more time offense. The standard fine amount is then applied to each I-9 with violations. As a result, a company’s fines can add up quickly, especially if the majority of an employer’s I-9 forms have violations. For example: if an employer is audited for the first time and the Auditor notes that there should have been 100 completed Form I-9s for employees, but 60 had some type of uncorrected/substantive violation. The employer could expect a fine of up to $2,332 per I-9 that the auditor determines has a violation ($2,332 x 60 = $139,920).

Employers should know:

  • I-9 ICE audits have dramatically increased in recent years;
  • The average fine per a single non-compliant Form I-9 is $1,862; and
  • 76% of paper Form I-9s have at least one error, with a similar percentage for missing or incomplete Forms; and

Your practice should implement a formal I-9 compliance policy. The best practice would be to start by conducting an internal audit of your current Form I-9s. During an internal audit, an employer is allowed to correct errors or missing information (technical violations) on a Form I-9, but there is specific guidance on how this should be done. Correcting errors/missing information after the fact, may help reduce the amount of a fine by showing you acted in good faith in the event you are audited. Consulting a knowledgeable attorney to conduct an I-9 audit and/or making corrections would be helpful.

By Robert S. Anderson, J.D., MSMS Legal Counsel