Because a no-match letter raises questions regarding an employee's work authorized status in the U.S., it can expose the employer to potential liability under IRCA for knowingly hiring or continuing to employ an individual who is not authorized to work in the United States.

The most obvious liability under IRCA arises when an employer has actual knowledge of an individual's unauthorized status; for example, because the employee admitted to it. IRCA liability is also implicated when an employer acquires "constructive knowledge" of an employee's lack of work authorization.

Receipt of a no-match letter with respect to an employee that is not work authorized can potentially lead to a finding of constructive knowledge if the employer did not take reasonable steps within a reasonable time of receipt to resolve the discrepancy. This typically comes up in the course of an I-9 Form inspection conducted by Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), an enforcement action under IRCA provisions. In the course of such inspections, HSI often requires the employer to submit copies of any no-match letters received in the past, along with the Forms I-9, copies of payroll records and a list of contractors and staffing agencies utilized the employer. No-match letters can potentially be used as evidence of the employer's actual or constructive knowledge of an employee or contractor's undocumented status if adequate measures were not taken.

How should employers handle no-match letters?

The specific actions to take with respect to no-match letters and the appropriate timeline of events depend on the particular situation and facts. If the discrepancy is caused by an error in input, it can likely be resolved either through correcting internal employer records or correcting the records in the SSA's database.

Further action may be required when the discrepancy cannot be resolved and a review of the relevant Forms I-9 may be appropriate in certain scenarios. If an employee admits to the employer that he or she is not work authorized or has used a false identity in the past, additional and prompt steps will be required to reduce the employer's exposure to IRCA liability. Any actions taken by an employer in response to a no-match letter must be taken in a manner that does not constitute prohibited discrimination.

What should employees consider if they are notified of a no-match letter listing their information?

Workers informed of a no-match should not panic as the discrepancy could be caused by an error in input. There are a number of reasons why reported names and social security numbers might not match SSA records, including typographical errors, unreported name changes, and inaccurate name order or hyphenation. Employees should follow directions by the employer and the SSA to correct any discrepancy and ensure correct reporting of their wages. Employees should keep in mind that a no-match is not necessarily a reflection of their immigration status and employers should not use the no-match letter alone to take adverse action against the employee.

What steps should employers take after completion of the no-match letter process?

Following completion of the no-match letter process, employers should undergo a preventative I-9 compliance self-audit in order to inspect I-9 records for errors and prepare for a potential enforcement inspection by ICE HSI. Such inspections have become very common in recent years and worksite compliance has become a critical part of any employer's overall compliance strategy. HSI inspections have significantly increased in recent years.

According to HSI, from July 16 to 20, 2018, HSI served 2,738 Notices of Inspection (NOI) and made 32 arrests. From January 29 to March 30, 2018, HSI served 2,540 NOIs and made 61 arrests. In Fiscal Year 2017, businesses were ordered to pay $97.6 million in judicial forfeitures, fines and restitution, and $7.8 million in civil fines, including one company whose financial penalties represented the largest payment ever levied in an immigration case. In Fiscal Year 2018, from October 1, 2017 through July 20, 2018, HSI opened 6,093 worksite investigations and made 675 criminal and 984 administrative worksite-related arrests, respectively. In Fiscal Year 2017 – October 2016 to September 2017 – HSI opened 1,716 worksite investigations; initiated 1,360 I-9 audits; and made 139 criminal arrests and 172 administrative arrests related to worksite enforcement.

The above statistics show a high number of government I-9 inspections over the past several years and employers from a variety of industries are being targeted. Some industries are naturally subject to higher scrutiny from government agencies and are more prone to making errors in the I-9 verification process. For example, healthcare providers are not only subject to increased regulatory scrutiny, but they also often encounter unique and complex I-9 issues that could expose them to higher liability for violations, as they often hire casual, per diem or remote workers. The verification process for such workers could present challenges that require special attention and handling. Another example is the restaurant and hospitality industry, as it often suffers from a high turnover rate, increasing the possibility of I-9 paperwork errors.

Employers in receipt of no-match letters should timely contact experienced immigration counsel to analyze and assist with any potential IRCA exposure or related immigration issues.

Yova A. Borovska is a counsel specializing in immigration at Buchanan Ingersoll & Rooney

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