"Tell Me More About E-Verify"

Frequently skepticism and concerns about government-provided employment tools and guides are based on unclear understanding of how those tools work but more often the anxiety lies around subjecting your business to greater government scrutiny.

A series of recent questions we have received about the Department of Homeland Security's (DHS) voluntary employment verification service (E-Verify) is a great example.

And so, we thought some straight talk about that particular program from our senior colleague and strategic business partner Bill Truesdell would be of interest.

Obviously E-Verify is not a process well-suited to all employers - as he points out near the end of his article - but there are a number of advantages for most others.

Rod Hanna
Principal
Merit Resource Group

E-Verify
Should You Use the Service?

The U.S. Government's employment verification service started out life as a test exercise known as the Basic Pilot/Employment Eligibility Verification Program. Then, after a period of time spent testing the system to see what bugs could be detected and repaired, the Department of Homeland Security (DHS) decided to offer it as a live service to employers across the country.

Now known as E-Verify, it is a voluntary program for most U.S. employers. If you are a participant in some work visa programs, the DHS will require that you be an active user of E-Verify. And, if you live in certain states you are required to use the service. In some cases, requirements only apply to private sector employers that are doing business with the state government.

Our clients are asking us questions about the value of E-Verify and the downside risks of participating. Some seem to think that using the service will require additional time on their part. Let's see what appears to be happening in real life.

What is E-Verify?

DHS requires all employers to record new employee data on Form I-9. That involves getting official documents from the employee that prove two things: 1) Their identity...that they are who they say they are, and 2) Their employment eligibility...that they have the right to work in this country. Form I-9 became a requirement when the Immigration Reform and Control Act was passed in 1986. E-Verify is a system that allows employers to know right away that employee Social Security numbers and employment eligibility documents are authentic. E-Verify is free and it is voluntary for most employers.

What States Require Employers to Use E-Verify?

As of this writing (April 30, 2008) there are nine states that have legislation requiring some or all employers within those states to participate in the E-Verify system. Check with your legal advisor if you are in one of these states to see if the requirement applies to you. And, be sure to monitor the changing requirements even if you are not in one of these geographies. Your state may require E-Verify at some time in the future.

• Arizona
• Colorado
• Georgia
• Illinois
• Minnesota
• Mississippi
• North Carolina
• Oklahoma
• Tennessee

Some of the states are experiencing legal challenges to those requirements.

In addition to these states, the city of Mission Viejo, California has passed a city ordinance that requires all employers with city contracts to verify employment eligibility for all their workers using the E-Verify system.

Why are Employers Resistant to E-Verify?

It seems many employers are fearful that using E-Verify will require more time and therefore the cost of their employment process will increase. There is also an expression of fear that another government system with access to huge databases smacks of Big Brother and a coinciding reduction in personal privacy.

So far we haven't seen evidence that employer costs will increase when using E-Verify. The service is free of government charges. It requires some keyboard time to input information on the I-9 Form, but that is minimal. For the question of privacy, we can only say all the documentation required in E-Verify is currently required for completion of the I-9 Form.

Why is E-Verify Sometimes Criticized?

Some people say that it is too easy to defraud E-Verify with stolen or seemingly-legitimate identity papers. Paper documents can be created illegally and used to fool the system according to these critics. Further, they point to the fact that only 52,000 out of 7 million U.S. employers participate in E-Verify. And, E-Verify is scheduled to expire in November 2008.

The Society for Human Resource Management (SHRM) is contributing its support to proposed federal legislation that would supersede E-Verify with a new on-line program that could give instant feedback and use biometrics such as thumb prints to help reduce or eliminate identity fraud. The E-Verify system relies on printed documents. Under the proposed New Employee Verification Act (NEVA) (HR 5515) the entire verification process would be done electronically, eliminating the Form I-9 altogether. You can download PDF version of HR 5515.

This proposed law would create the Electronic Employment Verification System (EEVS) and the Secure Employment Eligibility Verification System (SEEVS). SEEVS would be used for employment of people directly involved in national security jobs and EEVS would be used for all other new hires.

As written, the new law would still allow employers to voluntarily participate in the verification process. There are some exceptions, of course. Some will likely contain issues of Homeland Security. Among those issues are work visa applications.

If you wish to learn more, download SHRM's Employment Verification Booklet (PDF). It explains in detail the proposed law and why SHRM is supporting its passage.

Why is E-Verify Something for Employers to Consider Using?

Even though the E-Verify system will likely be allowed to expire toward the end of 2008, using such a verification system can help employers convince applicants that their documents will be verified with the Federal government. Simply letting people know their documents will be submitted to an examination may be sufficient to keep some would-be illegal applicants away from the process.

There are several benefits employers can gain by using the E-Verify system.

• There is no need to wait for a Social Security mismatch letter to determine that there is a problem with a new employee's Social Security number.
• There is no requirement to spend time correcting payroll and tax reporting records once a Social Security number is determined to be incorrect.
• People who are truly not authorized to work in this country can be detected at the point of hiring, rather than days, weeks or months later.
• If the employer submits all new employees to E-Verify and the government determines there is a problem with one or more people, the employer is much less likely to be a target for National Origin Discrimination Charges.
• The employer can point to participation in E-Verify as a support for U.S. public policy that only authorized individuals should be entitled to work in this country.

What Else Might Require an Employer to Participate in E-Verify?

One of our clients inquired about the E-Verify program because of an employee with an F-1 visa. Processing an application for extension of some work-authorizing visas subjects the employer to a government requirement that they register for and then participate in E-Verify. All who register must agree to the MOU (Memorandum Understanding), which says the employer must process all new employees through the E-Verify system.

So, if you are an employer in the habit of hiring workers with visa requirements, chances are pretty good that you will be required to use E-Verify. DHS will insist on it.

There is currently no requirement for government contractors to use E-Verify. While there are affirmative action obligations for many government contractors, this verification of work authorization requirement has not been proposed as a new contractor requirement.

What if an Employer Enrolls and Later Decides to Stop Using E-Verify? That is permissible under the current rules. Since participation is voluntary (in other than the states named earlier), it is possible to stop using E-Verify if the employer changes its procedures. And, if the employer has more than one work location, it is possible to use E-Verify at one location and not at others. All of these rules are spelled out at the U.S. Citizenship and Immigration Services (USCIS) web site.

Whether or not you use E-Verify, you still must retain I-9 Forms for all new employees. But, if you participate in E-Verify, you will also be able to retain the report that says all documents submitted by your new worker indicate a valid right to work in this country.

If you are an employer that makes a habit of hiring illegal workers, you can expect a visit from the DHS enforcement officials. Raids of employment locations are happening more frequently these days. And, sometimes company officers and managers are being arrested and charged with criminal violations of federal law.

Employers that don't rely on illegal workers to staff their workforce will have no such problems. In fact, it might be said that participating in E-Verify can lower your chances of government enforcement officials visiting with you.

Think about it. Then talk things over with your company attorney and consciously decide whether or not to participate in the E-Verify system. It is possible you will discover that it helps relieve you of some employment worries.

If you would like to have some in-depth consulting support to analyze your potential for using E-Verify, give us a call and we will be glad to talk with you about that need.

©2008
William H. Truesdell, SPHR, President
The Management Advantage, Inc.
Strategic Business Partner with Merit Resource Group, Inc.
aap@merithr.com