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Immigration Law Update

Dealing With Social Security No-Match Letters
September 13, 2007

Dealing With Social Security No-Match Letters

U.S. immigration law prohibits employers from employing unauthorized aliens and requires verifying each employee's employment eligibility with Form I-9. An employer with "actual" or "constructive" knowledge of unauthorized employment can be subjected to penalties, including fines from $275 to $11,000 per unauthorized alien. At the same time, U.S. law prohibits employers from discriminating based on national origin and citizenship, subjecting employers to discrimination claims. Complying with both prohibitions requires a delicate balance. A new Department of Homeland Security (OHS) rule, effective September 14, 2007, may help ease some of the tension - though some warn of unintended consequences.

SSA "No-Match" Letters
When an employee's name and SSN fail to match SSA data, Social Security Association (SSA) deposits the employee's FICA taxes in its earnings suspense fund (now reportedly at more than $500 billion) instead of the employee's social security account. The SSA has been using "no-match" letters to correct its database, properly credit the employee's earning record, and reduce the suspense fund. But, from the employer's standpoint, a "no-match" letter arguably can confer "constructive" knowledge that an employee is not authorized for employment, putting the employer in a quandary: to terminate the employee or risk DHS imposing immigration law penalties?

Procedures Consistent with DHS' new rule, when you receive an SSA "no-match" letter, take these steps:
Within 30 days of receiving the no-match letter: Check your records to determine if the mis-match can be explained by a name change or a typographical, clerical, or other error. If so, report the correct information to SSA. Document your actions.

Promptly thereafter: If the error can't be explained by your records, ask the employee to determine if the mis-match can be explained by his/her records or errors. If so, report the correct information to SSA. Document your actions.

Within 90 days of receiving the no-match letter: In either case, contact SSA at 800-772-6270 or http://www.ssa.gov/employer/ssnv.htm or http://www.ssa.gov/employer/ssnvadditional.htm to verify that the corrected employee information matches SSA records. Document resolution of the discrepancy. But, if you can't verify a match by the 90th day, then:

Within 3 days thereafter: Meet with your employee, as if a new hire, to verify employment eligibility by completing another Form I-9 and inspecting documents again. The employee must present facially valid documents - either: (1) a List A document (proving both identity and work authorization); or (2) a List B document (proving identity) and a List C document (proving work authorization). However, the employee is now subject to "special I-9 verification" and may not present the questionable social security card or a receipt for a new card application as a List C document. Keep the special I-9 with the old one.

Termination based on actual knowledge If your employee ever tells you before, during, or after this process - that he/she is not authorized to work, you risk penalties based on DHS finding that you had actual knowledge of unauthorized employment. To avoid that risk, you must terminate the employee.

Termination based on constructive knowledge If you do not timely obtain verification either from SSA or from a special Form I-9 and it turns out the employee is unauthorized, you risk penalties based on DHS finding that you had constructive knowledge of unauthorized employment. To avoid that risk, you must terminate the employee.

No termination based on "safe harbor" However, if you (1) take the above steps to correct the error in 30 days, and (2) obtain SSA verification in 90 days or, if necessary, properly complete a special I-9 form three days thereafter, you create a "safe harbor" in which DHS will not find constructive knowledge - even if it turns out the employee actually was unauthorized.
Still, the safe harbor will not protect you if you have actual knowledge of unauthorized employment. And the safe harbor does not extend to information you receive outside the "no-match" letter scenario.

DHS Notices
The new rule contains similar, but not identical, safe harbor procedures to follow if DHS sends you a notice about questionable immigration documents.

Discrimination
The rule does not provide an express safe harbor protecting against liability for discrimination. To help avoid discrimination claims, don't terminate an employee without first following the above procedures. Do apply these procedures across the board to all mis-matched employees, not just to those who appear foreign. When completing Form I-9, don't demand presentation of more or different documents or reject a facially valid document (except one subject to a government notice such as a no-match letter and that remains unverified).

Effective Date
A lawsuit has been filed challenging the rule. The complaint relies in part on a GAO report that most resolved SSA database discrepancies actually belong to U.S.-born citizens. It alleges that government databases are so unreliable and outdated that resolution of SSA discrepancies can't be accomplished within the 90-day period, resulting in the firing of lawfully-employed U.S. citizens and permanent residents without due process. As of this writing, DHS intends to implement the rule on September 14 notwithstanding the lawsuit.

Godfrey & Kahn's employment lawyers can provide updated information about the status of the DHS rule as well as comprehensive advice on your I-9 obligations in the context of your fact-specific situation. They also can help prepare written policies and assist with internal I-9 audits to prevent immigration law problems while avoiding discrimination claims.

USCIS Proposes To "Retire" Old-Style Green Cards

A resident alien card ("green card") serves as a form of identity and work authorization, and a permanent resident is required to carry his/her card at all times. Cards issued after 1989 expire and must be replaced every 10 years, but about 750,000 resident alien cards issued between 1977 and 1989 have no expiration date. The USCIS has proposed a rule establishing a 120-day filing period during which holders of old-style cards will be required to apply for replacement, including a recent photo, biometrics, and background check. Consistent with national security goals, the new card will be more tamper-proof. Failure to replace an old card would result in DHS "terminating" the card at some as-yet unannounced date following the 120-day filing period.

Card termination would not result in loss of permanent resident card status but would leave the permanent resident with no documentary evidence of the right to travel to or work in the United States. As an alternative to card replacement, the permanent resident could apply for U.S. citizenship through naturalization.

Immigrant Visas Expected To Be Available Again Soon

This summer, prospective employment-based immigrants and their employers experienced unprecedented confusion based on the State Department assuring in June that immigrant visas were available, followed by the Department of Homeland Security rescinding that assurance and rejecting filed immigrant petitions, followed by DHS reversing its position and establishing a new immigrant visa filing period (motivated in part by a threatened class action lawsuit).

The confusion led many to anticipate that no immigrant visas would be available for the foreseeable future. However, it appears that, as of September, immigrant visas for "extraordinary ability aliens," "international transfers," "outstanding researchers/professors," and "exceptional ability aliens" will be available, though backlogged. Visas for "professionals" will be available, though severely backlogged, for most aliens, but unavailable for nationals of China, India, Mexico and the Philippines.

Around The Corner: April 1, 2008 H-1B Visa Filing Date

U.S. employers in need of the professional services of foreign employees have been disappointed for the last two years by the inadequacy of the nonimmigrant H-1B visa quota. The high demand for H-1B visas exceeded the 65,000 per year quota within weeks of the filing period. For employers hoping for relief, Congress' failure to enact comprehensive immigration reform was a setback. Without comprehensive immigration law reform, employers won't be able to hire new H-1B employees until October 1, 2008.

That's more than a year away, but employers should prepare now. The application period will open on April 1, 2008 but, if the past is any guide, the 65,000 visas are likely to be exhausted in a few days or, worse, subjected to random selection by lottery (assuming compliance with requirements). If your business seeks to hire foreign talent, consult with your immigration lawyer now about preparing an H-1B petition ready for the April 1 filing date. Or consider other nonimmigrant business visa options, such as E-1/E-2 (treaty-trader), J-1 (business trainee), H-3 (trainee), L-1 (international transfer), O-1 (extraordinary ability), or TN (NAFTA professional), or employment-based immigrant visa options.

And, remember: The unavailability of new H-1B visas does not prohibit the exercise of H-1B portability for foreign employees already in H-1B status (with some exceptions).

Viva Las Vegas: 2009 Diversity Immigrant Visa Lottery

Every year, the U.S. government conducts a lottery for 55,000 immigrant visas made available to nationals of countries with low levels of immigration to the United States. This year's lottery will take place between October 3, 2007 and December 2, 2007. The lucky winners will be announced next spring and required to process their immigrant visas no later than October 1, 2009. Among other things, applicants must be 18 years old and have a high school education or two years of experience in a qualifying job.

You may wish to alert eligible applicants to this opportunity. Though the chances of winning the lottery are remote, electronic entry is easy and inexpensive and winning spares the prospective immigrant the expense, delay, and risk of a family-based or employment-based immigration petition.

Detailed instructions will appear soon at: http://travel.state.gov/visa/immigrants/types/types_1318.html.

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