New E-Verify Laws Create Complex Web of Federal and State Rules for Employers

While federal law mandates that federal contractors and subcontractors in all states must use the otherwise voluntary electronic employment eligibility verification system known as E-Verify, several U.S. states – including Alabama, Arizona, California, Georgia, and North Carolina – recently enacted laws mandating the use (or non-use) of E-verify, a free web-based system that allows employers to verify the legal work authorization status of newly hired employees, creating a complex and confusing web of laws and regulations. This is Trend Number 8 of the fifth annual  ‘Employment Screening Resources (ESR) Top 10 Trends in Background Checks’ for 2012. To view the list of trends, visit http://www.esrcheck.com/ESR-Top-10-Trends-in-Background-Checks-for-2012.php.

About E-Verify

The Immigration Reform and Control Act (IRCA) of 1986 makes it “unlawful for a person or other entity… to hire, or to recruit or refer for a fee, for employment in the United States an alien knowing the alien is an unauthorized alien.” Employers violating that prohibition may be subjected to federal civil and criminal sanctions. The IRCA also requires employers to take steps to verify an employee’s eligibility for employment.

In an attempt to improve that employment eligibility verification process, Congress established E-Verify – a free and voluntary web-based system that allows U.S. employers to verify the work authorization of newly hired employees by checking information on the Employment Eligibility Verification Form I-9 with Department of Homeland Security (DHS) and the Social Security Administration (SSA) databases – in the Illegal Immigration Reform and Immigrant Responsibility Act (IIRAIRA) of 1996.

According to statistics from the U.S. Citizenship and Immigration Services (USCIS), 98.3 percent of the 15.6 million queries submitted to E-Verify in the 2010 fiscal year were quickly confirmed to be legal workers. Employers who violate the E-Verify provisions may face costly fines and put their businesses at risk. A current E-Verify Legislation Map is available at http://www.trackercorp.com/everify-legislation-map.php.

Alabama

In 2011, a Federal Judge issued a ruling upholding mandatory usage of E-Verify by Alabama employers. Ruling on the then recently-enacted Alabama immigration law House Bill 56 (H.B. 56), the Chief Judge of the United States District Court for the Northern District of Alabama issued an opinion upholding the order that Alabama employers must confirm the work authorized status of all new workers using the federal E-Verify employment eligibility verification system beginning April 1, 2012 or face penalties for hiring unauthorized aliens. In addition, businesses in Alabama must enroll in E-Verify by January 1, 2012 and attest by sworn affidavit to not knowingly employ, hire, or continue to employ unauthorized aliens to receive government contracts and grants from the State.

While the opinion shows that several sections of H.B. 56 may be unconstitutional, the Judge upheld Section 15 of the law that requires all employers in Alabama to enroll in the federal E-Verify program and prohibits from hiring illegal immigrants, a ruling similar to a 5-to-3 U.S. Supreme Court decision in May 2011 that upheld a nearly identical portion of Arizona’s immigration law S.B. 1070 allowing states to punish employers violating mandatory E-Verify laws.

H.B. 56 was signed into law by Alabama Governor Robert Bentley and requires employers to use the now-voluntary federal E-Verify system to ensure that newly hired employees are legally eligible to work in the United States and would also authorize the revocation of business licenses for companies that employ illegal workers. All Alabama employers, both public and private, must begin using E-Verify when hiring new employees no later than April 1, 2012.

The full text of bill H.B. 56 is available at: http://www.openbama.org/index.php/bill/fulltext/3154.

The ruling for UNITED STATES OF AMERICA vs. STATE OF ALABAMA; GOVERNOR ROBERT J. BENTLEY is available at: http://www.cbs42.com/media/lib/124/5/d/1/5d1bd243-f883-4d25-9078-aa4f52da1cdd/Immigration_Ruling.pdf.

Arizona

While not new, Arizona’s law mandating E-Verify use made news recently. In a 5-to-3 decision in May of 2011, the U.S. Supreme Court ruled that states can punish employers who violate mandatory E-Verify laws by upholding a 2007 Arizona law – ‘The Legal Arizona Workers Act’ (House Bill 2745) – that requires employers in the state to enroll in the otherwise voluntary federal E-Verify program. In the majority opinion for the Court, Chief Justice John Roberts wrote that Arizona enforces its E-Verify employment verification requirement through licensing laws:

“Arizona’s procedures simply implement the sanctions that Congress expressly allowed the States to pursue through licensing laws. Given that Congress specifically preserved such authority for the States, it stands to reason that Congress did not intend to prevent the States from using appropriate tools to exercise that authority… We hold that Arizona’s licensing law falls well within the confines of the authority Congress chose to leave to the states and therefore is not expressly preempted.”

The U.S. Chamber of Commerce had sued the state of Arizona over a 2007 law that suspends licenses of businesses if they fail to use E-Verify to check the eligibility of all new hires, arguing that immigration enforcement is exclusively the purview of the federal government. Arizona was the first state in the country to pass a mandatory law requiring mandatory use of the E-Verify electronic employment eligibility verification system by employers.

The full Supreme Court ruling on the case ‘CHAMBER OF COMMERCE OF THE UNITED STATES OF AMERICA ET AL. v. WHITING ET AL.’ is available at: http://www.supremecourt.gov/opinions/10pdf/09-115.pdf.

To read ‘The Legal Arizona Workers Act’ (House Bill 2745), visit:
http://www.azag.gov/LegalAZWorkersAct/hb2745h.pdf.

California

While several U.S. states have passed laws requiring use of the electronic employment eligibility verification system known as E-Verify, California went in the opposite direction when Governor Jerry Brown signed the ‘The Employment Acceleration Act of 2011’ (A.B. 1236) that opposes E-Verify mandates and prohibits – except as required by federal law or as a condition of receiving federal funds – cities, counties, and special districts in California from requiring employers to use an electronic employment eligibility verification system such as E-Verify.

AB 1236 prohibits “the state, or a city, county, city and county, or special district, from requiring an employer other than one of those government entities to use an electronic employment verification system except when required by federal law or as a condition of receiving federal funds.” AB 1236 adds Article 2.5 (commencing with Section 2811) to Chapter 2 of Division 3 of the Labor Code, relating to employment.

Except as required by federal law, or as a condition of receiving federal funds, the state no city, county, city, or special district in California shall require an employer to use an electronic employment verification system, including under the following circumstances:

  • As a condition of receiving a government contract.
  • As a condition of applying for or maintaining a business license.
  • As a penalty for violating licensing or other similar laws.

‘The Employment Acceleration Act of 2011’ (A.B. 1236) is available at: http://leginfo.ca.gov/pub/11-12/bill/asm/ab_1201-1250/ab_1236_bill_20110909_enrolled.pdf.

Georgia

Joining the growing list of states mandating the use of the government’s E-Verify electronic employment eligibility verification system for private companies, in 2011 Georgia Governor Nathan Deal signed into law a stringent immigration bill – ‘HB 87 – The ‘Illegal Immigration Reform and Enforcement Act of 2011’ – that requires private employers in the state with more than 10 employees to check the immigration status of new hires using E-Verify, according to a press release from the Governor’s office.

The ‘Illegal Immigration Reform and Enforcement Act of 2011’ expands the Georgia’s current E-Verify requirement and will phase in mandatory E-Verify usage for many private businesses through the following approach:

  • Private employers in Georgia with 500 or more employees must use E-Verify for new hires on or before January 1, 2012.
  • Private employers in Georgia with 100 or more employees but fewer than 500 must use E-Verify for new hires on or before July 1, 2012.
  • Private employers in Georgia with between 11 and 99 employees must use E-Verify for new hires on or before July 1, 2013.
  • Private employers in Georgia with 10 or fewer employees are exempt from the law.

The law will also expand police powers to investigate the immigration status of suspects, penalize those who transport or harbor illegal immigrants, and make it a felony to use fake identification to get a job.

The full text of ‘HB 87 – Illegal Immigration Reform and Enforcement Act of 2011’ is available at: http://www.legis.ga.gov/Legislation/en-US/display.aspx?Legislation=32190.

North Carolina

In 2011, North Carolina Governor Beverly Perdue signed into law the requirement that cities, counties, and businesses in the state employing 25 workers or more use E-Verify, an internet-based system operated by the Department of Homeland Security (DHS) and the Social Security Administration (SSA) that allows participating employers to verify the employment eligibility of their newly hired employees. The law (House Bill 36) – “An Act To Require Counties, Cities, And Employers To Use The Federal E-Verify Program To Verify The Work Authorization Of Newly Hired Employees” – will be phased in for different employers from October 1, 2011, through July 1, 2013.

The E-Verify requirement will be phased in over a two year period in the following way and the employer must register and participate in E-Verify by the applicable date:

  • October 1, 2012, for employers that employ 500 or more employees.
  • January 1, 2013, for employers that employ 100 or more but less than 500 employees.
  • July 1, 2013, for employers that employ 25 or more but less than 100 employees.
  • Agricultural companies hiring seasonal workers for 90 days or less during a 12 consecutive month period will be exempt.

Effective October 1, 2011, counties and municipalities in North Carolina must use E-Verify, and each county and municipality shall register and participate in E-Verify to verify the work authorization of new employees hired to work in the United States.

The new legislation also enables anyone to file an anonymous complaint with the North Carolina Commissioner of Labor if they have a “good faith belief” that a business is employing an unauthorized worker. Businesses employing non-employment-authorized individuals would face the following penalties:

  • The first violation will result in a civil penalty of $10,000,
  • The second violation will result in a civil penalty of $1,000, regardless of the number of required employee verifications the employer has failed to make, and
  • The third or subsequent violation will result in a civil penalty of $2,000 for each required employee verification that the employer has failed to make.

The law also requires employers to retain records of its E-Verify verification of work authorization as long as the E-Verify authorized worker remains employed, and for one year after.

The North Carolina law, H.B. 36, is available at: http://www.ncga.state.nc.us/Sessions/2011/Bills/House/PDF/H36v7.pdf.

Federal Bill: Legal Workforce Act of 2011

At the federal level, the ‘Legal Workforce Act of 2011’ (H.R. 2164) was introduced in the U.S. House of Representatives. H.R. 2164 would make use of the federal government’s E-Verify electronic employment eligibility verification system mandatory for all employers in the United States in order to help ensure that all newly hired employees are legally eligible to work in the country, according the bill’s chief sponsor, House Judiciary Committee Chairman Lamar Smith (R-Texas).

If passed, major components of The Legal Workforce Act of 2011 (H.R. 2164) would include the following:

  • H.R. 2164 repeals the current paper-based I-9 system and replaces it with a completely electronic work eligibility check. 
  • H.R. 2164 phases-in mandatory E-Verify participation for new hires in six month increments beginning on the date of enactment.  Within six months of enactment, businesses having more than 10,000 employees are required to use E-Verify.  Within 12 months after enactment, businesses having 500 to 9,999 employees are required to use E-Verify.  Within 18 months after enactment, businesses having 20 to 499 employees must use E-Verify.  And within 24 months after enactment, businesses having 1 to 19 employees must use E-Verify. 
  • H.R. 2164 requires that employees performing “agricultural labor or services” are only subject to an E-Verify check within 36 months of the date of enactment.  Under the bill, an individual engaged in seasonal agricultural employment is not considered a new hire if the individual starts work with an employer for whom they have previously worked. 
  • H.R. 2164 preempts state laws mandating E-Verify use for employment eligibility purposes but retains the ability of states and localities to condition business licenses on the requirement that the employer use E-Verify in good faith under the federal law.  
  • H.R. 2164 grants employers safe harbor from prosecution if they use the E-Verify program in good faith, and through no fault of theirs, receive an incorrect eligibility confirmation.    

A copy of The Legal Workforce Act of 2011 (H.R. 2164) is available at: http://judiciary.house.gov/news/pdfs/Legal%20Workforce%20Act.pdf.

Designated E-Verify Employer Agents

Now more than ever, employers must maintain compliance in their Form I-9 and E-Verify process. The U.S. Immigration and Customs Enforcement (ICE) – the principal investigative arm of the DHS – recently issued Notices of Inspection (NOIs) to various employers around the country to determine if employers in the United States are violating employment laws by hiring unauthorized workers. ICE will conduct inspections for compliance of the Form I-9s that require employers to verify the identity and employment eligibility of all newly hired employees.

Employers may choose to have a Designated E-Verify Employer Agent assist them in maintaining compliance with the Form I-9 and E-Verify process and can help virtually eliminate I-9 form errors, improve the accuracy of their reporting, protect jobs for authorized workers, and help maintain a legal workforce. Employment Screening Resources (ESR) – a nationwide background check company accredited by the National Association of Professional Background Screeners (NAPBS) – is a Designated E-Verify Employer Agent. To learn more, visit http://www.esrcheck.com/formi9.php.

The fifth annual ‘Employment Screening Resources (ESR) Top 10 Trends in Background Checks’ for 2012 is available at http://www.esrcheck.com/ESR-Top-10-Trends-in-Background-Checks-for-2012.php.

About Employment Screening Resources (ESR):
Founded in 1997 in the San Francisco, CA area,
Employment Screening Resources (ESR) literally wrote the book on background screening with “The Safe Hiring Manual” by ESR Founder and CEO Lester Rosen. ESR streamlines the screening process and reduces administrative overhead though its proprietary technology solutions.  ESR is accredited by The National Association of Professional Background Screeners (NAPBS®), a distinction held by less than two percent of all screening firms. This important recognition was achieved by successfully passing a third party audit demonstrating compliance with the NAPBS Background Screening Agency Accreditation Program. By choosing an accredited screening firm like ESR, employers know they have selected an agency that meets the highest industry standards. For more information about ESR, visit http://www.ESRcheck.com or call toll free 888.999.4474. 

About ESR News:
The Employment Screening Resources (ESR) News blog –
ESR News – provides employment screening information for employers, recruiters, and jobseekers on a variety of topics including credit reports, criminal records, data privacy, discrimination, E-Verify, jobs reports, legal updates, negligent hiring, workplace violence, and use of search engines and social network sites for background checks. For more information about ESR News or to send comments or questions, please email ESR News Editor Thomas Ahearn at tahearn@esrcheck.com.

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