Although President Obama has recently indicated that comprehensive immigration reform is likely to be on the back burner until 2010, it's clear the administration plans to continue focusing on employers' immigration compliance. In recent months, we've seen the Department of Homeland Security (DHS) and the Department of Labor (DOL) increase their investigations of employers hiring foreign national workers. On July 1, 2009, in response to DHS' announced shift in enforcement strategy, U.S. Immigrations and Customs Enforcement (ICE) issued 652 Notices of Inspection (NOIs) to conduct Form I-9 audits of businesses across the country; just 503 notices were issued to employers in all of 2008. Around the same time, U.S. Citizenship and Immigration Services (USCIS) announced it was using contract inspectors to perform thousands of "random," on-site inspections of H-1B and L-1 employers to identify fraudulently filed H-1B and L-1 petitions. The fraud detection program is funded through the mandatory $500 "anti-fraud" fee paid by employers to USCIS when sponsoring an H-1B or L-1 employee. In addition, the U.S. Department of Labor announced that it hired 250 new investigators to investigate employers' wage and hour obligations.

Given the administration's strategy to deter illegal immigration by focusing on those employers who hire unauthorized workers, it is critical for employers to ensure, now more than ever, that they are complying with federal immigration requirements. The potential civil and criminal liabilities associated with noncompliance, as well as the potential disruption of business operations, are just a few of the reasons companies must take these enforcement trends very seriously. This article will provide you with a brief overview of what employers can expect during an H-1B, L-1, or I-9 inspection, and some best practices that every company should implement now, in an effort to avoid penalties later.

What can I expect during an I-9 on-site inspection?

In most instances, ICE will issue an NOI, instructing the company that it has three days to present its Form I-9s for current and terminated employees to Immigration and Customs Enforcement (ICE) for review. An ICE team of forensic auditors, along with field agents, then conducts the review. In some instances, a company representative may also be asked to appear for a personal interview. It could be weeks, or even months, before ICE will get back to the employer with its findings. The employer may receive a "Notice of Intent to Fine" and/or a list of undocumented workers who must be terminated. Fines for mere paperwork violations can range from $110 to $1,100 per violation. Criminal charges may also be brought against a company suspected of willfully hiring ineligible workers.

What should I do if my company receives a Notice of Inspection?

First, you should immediately contact your general counsel, followed by your immigration counsel. You must begin gathering your I-9s and supporting documentation and making copies of all documents. Having copies for your reference may be a big help later on, should ICE initiate further investigations following the NOI. You should review your payroll records and determine if I-9s are missing for any active employees. You should work with your immigration counsel to conduct a self-audit of your I-9s to determine if there are specific areas of concern, and to make corrections where appropriate.  
         
Best Practices to Consider

  • Adopt a written immigration compliance policy that incorporates ICE's recommended best hiring practices
  • Designate a compliance officer within the company responsible for ensuring that the company and its employees understand the laws and comply with the policy.
  • Ensure HR personnel are regularly trained in the legal requirements of documenting workers and the responsibility for completing I-9s.
  • Work with immigration counsel to conduct annual I-9 audits.
  • The law requires companies to retain I-9s for three years from the date of hire or one year following termination, whichever is later. Keep only the I-9s you need!
  • For companies enrolled in the E-Verify program, make sure your I-9 practices conform to the requirements under the E-Verify Memorandum of Understanding.
  • Develop a response plan for dealing with government visits, audits, investigations and raids.

What can I expect during an on-site H-1B or L-1 inspection from USCIS?

Typically, the on-site inspection will occur without advance notice to the employer. The inspector normally will not produce a warrant or subpoena. In some instances, employers have reported receiving a call from the USCIS investigator to set up a specific appointment, but in many cases, the investigator makes an unannounced visit to the company. According to USCIS, inspectors will verify that the company is a legitimate, operating business and that the H-1B or L-1 employee is an actual employee working at the job location. Inspectors will typically want to meet and interview the H-1B or L-1 worker, confirm his or her identity, and meet with human resources personnel to verify that information about the H-1B or L-1 employee's job matches contained in the H-1B or L-1 petition that was filed with USCIS. Specifically, the investigator is looking for two types of fraud: (1) a foreign worker who falsifies an application and claims to work for a company he does not work for; and/or (2) a company that falsifies a visa application. These investigations are expected to be conducted in 28 cities. Employers are to be selected randomly. Reports are that these interviews take less than 15 minutes.

In addition to these USCIS on-site inspections, DOL has been sending Wage & Hour Division questionnaires to H-1B employees via e-mail, requesting information on the foreign worker's employment, wages and deductions, working conditions and more. The questionnaire indicates that it is voluntary and that the foreign worker's identity will be kept confidential. It's not clear at this time whether these questionnaires are being sent out randomly or based on targeted investigations, or how DOL is getting foreign workers' email addresses.

What should I do if my company gets an on-site visit from USCIS?

First, don't panic! In the case of a USCIS on-site inspection, it's most likely the result of a random audit, not a targeted investigation. Second, make sure to ask for official identification and contact information from the inspector, and then immediately call your immigration counsel. USCIS investigators will not have a court-issued warrant or subpoena, so you are not required to comply with any request you feel is out of bounds. Nonetheless, all attempts should be made to comply with any reasonable request for information or an interview. Immigration counsel can work with you to get the inspector the information he or she needs.

Best Practices to Consider

  • Designate a compliance officer within the company responsible for ensuring that the company and its employees understand the laws and comply with the policy.
  • Develop an internal procedure for dealing with government visits, audits, investigations and raids. Make sure your reception staff is aware of these procedures.
  • Review your immigration policies and procedures related to layoffs and terminations.
  • Make sure your I-9 records are ready for review in case the USCIS inspector asks for these files. Internal I-9 audits should be conducted on a regular basis. When the government shows up at your doorstep is the worst possible time to begin thinking about whether your I-9 forms are in compliance.
  • Work with immigration counsel to conduct periodic audits of your H-1B public access files. Such audits should include:
    • Ensuring the content of your public access files is complete.
    • Ensuring the procedural requirements have been met (e.g., notice was posted properly, a copy of the Labor Condition Application was provided to the employee on a timely basis, the public access file is in the proper location, etc.).
    • Ensuring the substantive requirements have been met (e.g. payroll records confirm that the H-1B employee was paid the required wage, an H-1B worker has not been "benched," etc.).

We urge every employer to conduct regular audits of its I-9 and H-1B records to ensure compliance with federal immigration regulations. We often hear from employers that their records are in "good shape." Unfortunately, the reality is that few employers properly maintain their records. Buchanan's team of experienced immigration attorneys is ready to assist you with the self-audit process. Employers can choose to audit all of their I-9 and/or H-1B records, or do a condensed audit, in which a select number of randomly chosen records are audited. This will give employers the confidence to know that they are in compliance. If there are problems with the I-9 forms or H-1B records, Buchanan will advise on the proper steps to be taken. These steps can help to ensure future compliance, and can also be used as a good faith defense should there be problems.