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As previously reported, September 8, 2009, marks the first date that federal contractors and subcontractors will be required to begin using the federal government's E-Verify system to electronically verify the work eligibility of newly-hired employees and existing employees assigned to work on qualifying government contracts. The rule is an amendment to the Federal Acquisition Regulation (FAR), which governs the federal government's acquisition process. The one item that remained outstanding was a pending lawsuit filed by the U.S. Chamber of Commerce and other business groups challenging the regulation.  

On August 25, 2009, the U.S. District Court for the District of Maryland upheld the E-Verify  regulation. In the written opinion, Judge Alexander Williams, Jr. rejected the Chamber's main argument that the rule violates the Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA) by mandating use of E-Verify, instead noting that "the decision to be a government contractor is voluntary." The Chamber is currently deciding whether to appeal the decision.

The E-Verify rule sets out that federal contracts awarded and solicitations issued after September 8, 2009, will include a clause requiring the contractor and any covered subcontractors on the project to enroll in the E-Verify program within 30 calendar days of the contract or subcontract award date. Existing indefinite quantity/indefinite delivery (IDIQ) contracts may also be modified on a bilateral basis to include the E-Verify clause. Once enrolled, contractors will then have an additional 90 days to actually begin using the system to verify the work eligibility of new hires and workers assigned to the qualifying contract. The rule does not require federal contractors to verify their entire workforce, though they may choose to do so.

With the September 8th effective date fast approaching, it's important to begin looking at the E-Verify enrollment process and requirements now so that your company has the resources in place to be in full compliance. Although employers will not be required to utilize E-Verify until a government contract contains the E-Verify clause or is amended to include the clause, it is not too early to put the steps into place now to be ready to comply with the E-Verify rule. Your HR and Legal Departments should work together to ensure that contracts are reviewed for the E-Verify clause.

Employers are encouraged to begin developing an "E-Verify policy" that will answer the following questions:

  • Which employees will be trained and be responsible for E-Verify queries?
  • Will the employer use the E-Verify system to verify employment of all of its employees or for only newly-hired employees and those employees assigned to a qualifying contract?
  • How will employees "assigned to a contract" be identified?
  • For those companies using E-Verify on a voluntary basis, will the entire organization use E-Verify or only select offices or locations?
  • How will tentative nonconfirmations or final nonconfirmations be communicated to the employee?
  • How will possible termination decisions be handled? 
Since the E-Verify system requires that I-9 forms be completed, we also recommend that employers conduct in-house audits of the I-9 forms to ensure that all of them are correct. An internal audit of an employer's I-9 forms can take time, so employers are encouraged to begin this process now.  

With the District Court of Maryland affirming the E-Verify rule, employers need to be ready for implementation of E-Verify. Employers are reminded that use of the E-Verify system continues to be voluntary until September 8, 2009, unless state or local regulations require its use. However, we advise any employer who thinks it might qualify as a current or prospective federal contractor or subcontractor to contact one of our Immigration or Government Contracts attorneys. We are available to explain the federal contractor rule and the E-Verify program in more detail, including how the rule may affect your business.