WHEN TO EXPECT AN I-9 AUDIT AND THE AUDIT PROCESS
HOW DOES A BUSINESS OWNER KNOW WHEN THEIR BUSINESS IS GOING TO BE AUDITED?
Businesses can be audited at any time. Employers will receive a Notice of Inspection (NOI) and are given at least three business days to produce the Forms I-9.
The business employer may be requested to provide supporting documentation, such as a current employee listing, copy of their payroll, business licenses and or Articles of Incorporation.
WHAT HAPPENS WHEN A VIOLATION IS FOUND DURING AN I-9 AUDIT?
If violations are found, an employer is given ten business days to make corrections. For substantive and uncorrected technical violations, an employer may receive a monetary fine for each violation. A notice may be given to the employer regarding the audit. Below are some of the types of notices an employer may expect if violations are determined during the audit:
Notice of Discrepancies: ICE provides this notice to the employer when they are unable to confirm the employment eligibility of an employee based on the information provided on the I-9. The employee in question, is to be provided a copy of the notice and allow him/her the opportunity to submit additional documentation to prove work eligibility.
Notice of Suspect Documents: ICE will provide this notice to the employer when they have reason to believe that an employee at the business is unauthorized to work. The employer and employee will be able to addresses there concerns by submitting additional documentation to ICE within10 days.
Notice of Technical or Procedural Failures: This notice serves to inform the employer of Technical violations are less serious than substantive violations. This notice identifies the technical violations that were found during ICE’s inspection. The employer is allowed up to10 days to correct the issues. These technical issues will become substantive violations if not corrected about the 10-day period.
Notice of Intent to Fine (NIF) – This notice will state the violations that are substantive, uncorrected technical, knowingly hire and continuing to employ violations.
Employer who have received an NIF will have up to 30-days to request a hearing before the Office of the Chief Administrative Hearing Officer (OCAHO) or negotiate a settlement with ICE. If no action is taken after receiving a NIF, a Final Order will be issued by ICE. OCAHO will assign the case to an Administrative Law Judge (ALJ) if a hearing is requested. All parties will receive a copy of a Notice of Hearing and government’s complaint.
WHAT TYPE OF PENALTIES COULD AN EMPLOYER FACE?
The employer may be penalized with a fine(s) and required to suspend all unlawful activity for knowingly hiring/continuing to employ violations and in some cases, may be criminally prosecuted and or will be prevented from participating in future federal contracts and from receiving other government benefits.
- A business owner knowingly hires and continues to employ unauthorized workers will result in violations range from $375 to $16,000 per violation. A business owner who repeats violations will be at the higher end of this range.
The employer may be penalized with a fine(s) for substantive and technical violations that have not been corrected.
The number of violations will be divided by the number of employees for which a Form I-9 should have been prepared to obtain a violation percentage. Depending on whether this is a first offense, second offense, or a third or more offense, this percentage provides a base fine amount.
- A company has 86 employees. 22 of the forms are incorrect. The violation percentage is 26% and this is a second violation. The penalties assigned to this company would be 22 x $750 = $16,500!
- A company has 24 employees. 13 of the forms are incorrect as several are missing information; some have information written in the wrong places, some newer employees completed expired forms. The violation percentage is 54%, but this is the first violation. The penalty assigned to this company would be 13 x $935 = $12,155!
- A company has 55 active employees and 8 employees that termed within the last year. 63 of the forms are either missing or incorrect. The violation percentage is 100% and this is a first violation. The penalties assigned to this company would be 63 x $935 = $58,905.
To avoid violations, employers should take steps prior to an audit to reduce potential violations that can result in fines from an I-9 audit. One step would be to seek legal counsel to ensure the correct forms and measures are taken to avoid penalties. Additionally, employers should keep all forms current and complete. For more suggestions, see our article “How to Prepare Your Business for an Increase in Workplace I-9 Enforcement.”
The attorneys of Waltz, Palmer & Dawson, LLC frequently counsel business owners on I-9 audits. If you would like to schedule an initial consultation at no charge to discuss questions you have about I-9 audits and any other legal needs for your business, please contact Waltz, Palmer & Dawson, LLC at (847) 253-8800 or contact us online.
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