President Bush Signs Order Requiring All Federal Contractors to Use E-Verify

President Bush Signs Order Requiring All Federal Contractors to Use E-Verify
by Ken C. Gauvey

E-Verify has been hailed as the salvation of America as well as the harbinger of its end. In truth, it is neither of these. E-Verify is a process where employers can check the identification information of new hires against the Social Security Administration’s (SSA) database and employment eligibility through the United States Citizenship and Immigration Services (USCIS) database. By the end of 2008, all employers with a federal contract will be required to use it. On June 6, 2008, President Bush signed an Executive Order requiring all federal contractors to use E-Verify to check the identity of new hires and any employee working directly under the federal contract. Within six days, the Federal Register had published proposed regulations for the implementation of this Order. The regulations themselves can be found at Federal Acquisition Regulation, 73 Fed. Reg. 114, 33374 (June 12, 2008) (to be codified at 48 C.F.R. pts. 2, 12, 22, and 52). The comment period on these proposed regulations run to August 11, 2008. Sometime after this, the final regulations will be imposed.

Essentially, E-Verify is just a website. Employers who participate go to the website and type in some information provided by the employee when completing the Form I-9. That information is then sent to the database where it is confirmed or is returned with a tentative nonconfirmation. This nonconfirmation does not mean that the employer must terminate the employee. There is an estimated 8-12% error rate reported with the database. Employers who terminate employees because of the nonconfirmations face some significant legal problems.

On June 16, 2008 Aramark Facility Services lost an appeal to the 9th Circuit because it terminated employees whose information did not match the data contained in the SSA database. Aramark gave the employees three days to get the information corrected and then proceeded to terminate the employees. The Ninth Circuit stated that Aramark simply did not provide enough time for employees to correct the SSA database information and therefore, Aramark had to reinstate 33 janitors, presumably with back pay.

In fact, there are specific guidelines in effect that outline the process employers should utilize when those nonconfirmation notices are received. When the database returns a tentative nonconfirmation, the employer is required to provide a “Notice to Employee of Tentative Nonconfirmation.” The employee must then indicate on the notice whether they will contest the notice or not. Both employee and employer should sign the notice.

If the employee chooses to contest the notice, the employer prints out a “Referral Letter” from the E-Verify system. This letter contains information about resolving the notice as well as the contact information for the SSA or USCIS, depending on which agency was the source of the nonconfirmation. The employee then has eight days, according to the proposed rule, to contact the proper agency to get the situation resolved. During this time, employers who participate in E-Verify may not terminate an employee who is contesting the nonconfirmation.

It should be noted, that these procedures are from the proposed regulations. The regulations for “No-Match” letters that have been proposed, give employees a much longer time to correct these issues, 30 days.

These regulations, when final, will apply to any company that has a federal contract. This most likely includes any private or public school as well. In 1984, in Grove City College v. Bell, the Supreme Court determined that a private college whose students received some federal student aid was subject to federal statutes addressing educational institutions. Grove City College did not directly receive any federal financial assistance, however, some if its students received basic educational opportunity grants. The Supreme Court determined that this was sufficient to bring the college under the jurisdiction of federal regulations. It is likely that this Executive Order will be interpreted under this expansive view of federal authority.

There are some additional problems, outside of the error rate, with using E-Verify. E-Verify requires that employers verify current employees who will work directly under any federal contract. However, section 274A of the Immigration and Nationality Act provides that employment verification is to take place at the hire of the individual. Therefore, E-Verify’s requirement of post hire verification may have to overcome federal law.

In addition, to participate in EVerify, employers have to sign a Memorandum of Understanding (MOU). This Memorandum outlines the responsibilities of agencies and employers participating in E-Verify. The current MOU states that employers are to use E-Verify for new hires only, and not use it for employees hired before the MOU went into effect.

The MOU also requires that employers allow the Department of Homeland Security and SSA to make periodic, unannounced visits to the employer to review E-Verify records and to interview employees without notice. This provision requires that employers give up certain Constitutionally protected rights. DHS and SSA do not need a warrant to go onto an employer’s premises and review records or interview employees when that employer participates in EVerify.

E-Verify is not a complex system. Employers should be able to sign up and begin using it if this Order goes into effect. However, if employers have any questions about the program or have any concerns about how to react to nonconfirmation notices, employers should contact legal counsel.

Kollman & Saucier, P.A., The Business Law Building, 1823 York Road, Timonium, MD 21093 Phone: 410-727-4300
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President Bush Signs Order Requiring All Federal Contractors to Use E-Verifyby Ken C. Gauvey

President Bush Signs Order Requiring All Federal Contractors to Use E-Verify
by Ken C. Gauvey