WHAT EVERY IN-HOUSE COUNSEL NEEDS TO KNOW ABOUT IMMIGRATION COMPLIANCE FAUSTA M. ALBI DIANA VELLOS COKER

Transcription

1 WHAT EVERY IN-HOUSE COUNSEL NEEDS TO KNOW ABOUT IMMIGRATION COMPLIANCE FAUSTA M. ALBI DIANA VELLOS COKER 1

2 Why Should General Counsel Care About Immigration Compliance? Risks are too high not to care Negative audit by USCIS, DOL, or ICE can result in - Bad Press - Loss of investors - Strain on workforce so that company can no longer operate its business - Heavy fines - Criminal prosecutions 2

3 WHAT IS THE WORST THAT CAN HAPPEN? Civil Monetary Penalties From 2009 to 2012, ICE issued $31.2 million in civil fines to employers Criminal Penalties From 2009 to 2012, there have been 1,528 criminal indictments and 1,395 criminal convictions from worksite enforcement investigations 3

4 Only An Issue for Certain Industries? Boeing s immigrations woes B-1s and bad press Infosys In 2013 company agrees to pay the largest immigration fine in history ($34 million) as part of a settlement agreement 4

5 Steps an Employer May Take to Minimize Organizational Risk Own the immigration function; can do so without knowing all the details Transparency throughout the team is critical Allows accurate legal advice to reach all interested parties; minimizes miscommunications Increases confidence that the matter is being handled competently Helps manage expectations, minimize anxiety and frustration Team should consist of: You General Counsel or Chief Legal Officer Human Resources, or whomever you have assigned as the point person for the function Outside immigration counsel The hiring manager When possible, the foreign national employee 5

6 Risk of I-9 Violations Seems like a simple form what s the big deal? Even employers who believe their I-9s are in great share are surprised to find the state of affairs during an audit. Issues include: Over-documentation and asking for specific documents = discrimination, enforced by Office of Special Counsel (OSC) Failure to track expiration of work authorization; untimely re-verification = a substantive error which cannot be corrected in the event of an audit, enforced by Immigration and Customs Enforcement (ICE) Lack of documents or improper documents accepted = work authorization not verified = substantive violation, enforced by ICE Missing I-9s 6

7 Risk of I-9 Violations Errors may occur on I-9s of all employees, but tend to be more frequent and more egregious for non-u.s. workers. I-9s for remote employees tend to contain more errors, both on the document and in the process for completion Civil monetary penalties can be significant Fines range from $110 to $1100 per form with error on it Please see handouts with fine schedules 7

8 How to Minimize Risk of I-9 Violations Conduct and document staff training on proper completion, maintenance and compliance issues even if your company does not employ a single foreign worker Ensure one person takes responsibility for the process, rather than ad hoc completion of I-9s by various people Ensure there is a tickler system for expiration of work authorization A written policy regarding I-9 procedures is key, both for training and as a defense in the event of an audit Consider the pros/ cons of outsourcing the function Consider the pros/ cons of an electronic I-9 system Have a clear procedure in place in the event of an audit 8

9 What Happens in the Event of an I-9 Audit? Dept. of Homeland Security, Immigration and Customs Enforcement, Homeland Security Investigations (HSI) serves a Notice of Inspection Clear protocol and chain of command in event of an audit is critical Will give you the option to waive the 3-day notice NEVER waive the 3-day notice Mad rush ensues to audit and correct correctable errors. Corrections critical because some substantive violations may be reduced to technical violations, lowering the fine Agent comes back to pick up original I-9s, any Section 2 document copies, payroll records In a few weeks to a few months HSI completes their review 9

10 Results of ICE HSI I-9 Audit May issue a Notice of Suspect Docs Give impacted employees the opportunity to contest in reality, most will not return to work Can negotiate with ICE to stagger terminations May issue a Notice of Technical and Procedural Errors Employer has 10 days to correct errors identified by ICE May issue a Warning Notice Agent found errors, but elected not to fine employer this time Employer will often be audited a second time in 6 to 12 months; if errors are found again, employer will be fined May issue a Notice of Intent to Fine This is the charging document if fines are assessed Can try to negotiate amount of fines May appeal NOIF to OCAHO (EOIR); fairly good rate of lowering fines 10

11 Five Criteria to Mitigate Fines Five criteria ICE will consider in fine assessment Size of the employer Seriousness of the violation Good faith of the employer Whether there were unauthorized workers or just technical violations History of prior violations Each criteria may impact the fine amount by +/-5% In reality, the primary factor ICE uses to determine the fine amount is the percentage of I-9s which contain errors 11

12 Proactive Internal I-9 Audits Benefit: Gets I-9s in shape prior to an ICE audit In the event of an ICE audit, only have 3 days to make corrections Not enough time to clean-up I-9s, especially for employers with a large workforce, employees working in different locations, and employees who are absent during the 3 days Who should conduct the internal audit? Preferably not the same person/ people who completed the I-9s However, note that Section 1 errors must be completed by the employee and Section 2 and 3 errors must be completed by the original employer representative or another rep with knowledge Must watch for impermissible corrections (backdating, etc. will result in a bad faith determination in the event of an audit) After a proactive audit has been completed, either by internal staff or external counsel, must monitor to ensure compliance continues 12

13 E-Verify What is E-Verify? An internet-based system which verifies work authorization of new hires In many cases employer enrollment is voluntary Is mandatory for most federal contractors and in some states and municipalities How does it work? Must run employee s info through E-Verify no later than the 3 rd business day after employee begins work for pay Most verifications come back within seconds May receive an initial, interim or final result If receive Tentative Non-confirmations (TNC), doesn t necessarily = unauthorized worker Employee must be provided the opportunity to resolve the issue; cannot be immediately termed based on TNC 13

14 E-Verify and Federal Contractors Pursuant to a 2008 Presidential Executive Order and subsequent Federal Acquisition Regulation (FAR), federal contractors must use E-Verify to confirm employment authorization of employees working under federal contracts Note that the requirement to enroll in E-Verify extends to all prime sub-contractors can make compliance very difficult The E-Verify rules for federal contractors are distinct from other employers and must be thoroughly reviewed by any employer which may be subject 14

15 E-Verify Rules to Watch Except for certain federal contractors, cannot run current employees through E-Verify; only applies to new hires after E- Verify enrollment Cannot run E-Verify until employee has been hired (offer, acceptance, I-9 completion; cannot use it as a screening tool) Cannot run an employee through E-Verify more than once Once enrolled, employer cannot just cease using E-Verify; must terminate MOU with government with at least 30 days written notice 15

16 Pros: E-Verify To Enroll or Not to Enroll Helps ensure a person is work-authorized at the time of hire; creates a rebuttable presumption that employer has not violated the law Allows employers who want to extend the Optional Practical Training period for an F-1 foreign student from 12 to 29 months; requires grad with a STEM degree and enrollment in E-Verify May be pro or con, depending on perspective/ industry: Employer must post notices visible to all employees and the public confirming that the company is enrolled in E-Verify 16

17 E-Verify To Enroll or Not to Enroll Cons: Must sign MOU. Government is monitoring the system and can easily track and document errors. Subjects employer to Desk Review upon request. Not a safe harbor; employer may still be fined for errors, and may still be the subject of an I-9 audit If employer receives a Final Non-confirmation and fails to timely term employee, triggers a rebuttable presumption that employer has knowingly employed unauthorized individuals = serious violation May be administratively burdensome; requires consistent attention to protocol and detail to avoid violations 17

18 ICE IMAGE To enroll or not to enroll What is IMAGE? Marketed by ICE as an education/ outreach tool to assist employers In reality, it is the offer you can t refuse. Federal contractors and employers already being investigated by ICE tend to be most interested in joining As part of IMAGE participation, employer agrees to: Enroll in E-Verify Submit to an ICE audit of its I-9s can negotiate percentage, but beware of promises Pros and cons Pro: Know audit is coming so have some time to clean up Con: Does not provide safe harbor; employer may still be charged for violations or audited again Con: Results in disclosing employer s information to the government prosecutorial agency - willingly 18

19 Immigration Impact of Corporate Changes Critical to assess the immigration impact of certain corporate actions including: Mergers Acquisitions Reductions in Force Closure of a Facility (including overseas operations) Temporary Shutdowns Re-organizations Bankruptcy Filings Pay Reductions Name Changes Changes in location 19

20 Understanding the Immigration Impact of Corporate Actions Avoid employment discrimination Avoid gaps in employment authorization of key employees Avoid additional legal and filing fees associated with particular visa types Avoid penalties and fines for noncompliance with the immigration regulations Create strategies to ease the negative immigration impact on foreign nationals 20

21 Honesty Policies Know Their Limitations 2014 Governor Jerry Brown signed into law Assembly Bill No Makes it illegal for employers to target an employee s immigration status (cannot threaten to contact immigration authorities about an employee as an act of retaliation) Also prohibits employers from taking adverse actions against employees for updating personal information including changes to their work authorization Review company s honesty policy to ensure that it is in compliance with AB

22 What the Future Holds: Immigration Reform Numerous immigration-related bills are pending in Congress at any given time; most do not materialize In June 2013, Senate passed a bill that would have mandated the use of E-Verify type system never happened Despite Executive Actions announced by President Obama, we are far from implementation of most provisions Given history in Congress, implementation is likely to be challenged and delayed Change in Administration may also result in reversal of policies implemented pursuant to Executive Action Best bet: Any form of Comprehensive Immigration Reform will contain a significant worksite enforcement component 22

23 Diana Vellos Coker Fausta M. Albi Pacific Heights Blvd. Ste San Diego, CA