Department of Homeland Security Finalizes Social Security No-Match Regulations

On August 10, 2007, the Department of Homeland Security (DHS) announced that it had finalized regulations that govern employers' duties in verifying individuals' authorization to work in the United States. The regulations set forth a series of steps that employers may take in response to a notice from the Social Security Administration (SSA) or DHS that an employee's name and Social Security number do not match government records. Employers who fail to take these steps may be deemed to have constructive knowledge that an employee does not have employment authorization.

The final regulations, entitled "Safe Harbor Procedures for Employers who Receive a No-Match Letter", will likely be published the week of August 17, 2007. The final regulations take effect 30 days after the date of publication.

Summary of the Final Regulations

The SSA often mails letters to employers when the information in its databases does not match the name or Social Security number for employees, as reported on the earnings reports that employers file with the SSA. The regulations amend the current definition of "knowing" to provide that employers who receive these "no match" letters from the SSA may be deemed to have constructive knowledge that the individuals who are listed in the letters are not authorized to work in the United State. The regulations also provide a "safe harbor" from penalties for employers who take specific actions following the receipt of such letters.

The final regulations provide the following steps for employers to follow upon receipt of a no-match letter from the SSA:

1. Within 30 days of receipt of a no-match letter: The employer must check its records to determine whether the discrepancy resulted from a typographical, transcription or similar clerical error. If the discrepancy was caused by such an error, the employer must correct the error with the SSA and verify that the employee's name and Social Security number now match the SSA's records. Employers should make a record of the manner, date, and time of such verification and retain the record with the employee's I-9 form. If the discrepancy was not caused by an error in the employer's own records, the employer should promptly confirm with the employee that the name and Social Security number in the employer's records are correct. If the employee indicates that the employer's records are incorrect, then the employer should correct its records and verify that the employee's name and Social Security number now match SSA's records. If the employee confirms that the employer's records are correct, the employer should promptly request that the employee resolve the discrepancy with SSA.

2. Within 90 days of receipt of the no-match letter: The employee should be advised that he or she must resolve the discrepancy with SSA within 90 days of the date that the employer received the notice from SSA.

3. Within 93 days of receipt of the no-match letter: If the employee is unable to resolve the discrepancy with SSA within 90 days of receipt of the notice, the employer must again verify the employee's employment authorization and identity by completing a new I-9 form. The same procedures should be used to complete the new I-9 form as were used when the original I-9 form was completed at the time of hire, with certain exceptions. The employee must complete section one and the employer must complete section two within 93 days of the employer's receipt of the written notice from SSA. The employer cannot accept any document that contains a disputed Social Security number, or any receipt for the replacement of such a document, to establish employment authorization or identity. The employee must present a document that contains a photograph in order to establish identity or both identity and work authorization. The newly completed I-9 form should be retained with the prior I-9 form(s).

If, at the end of this process, the employee's work eligibility cannot be reverified, the employer will need to terminate his/her employment or risk the possibility that DHS may seek to impose penalties on the employer for knowingly employing an unauthorized alien in violation of law.

The regulations also provide that an employer may be deemed to have constructive knowledge if the employer fails to take reasonable steps after receiving a request from an employee to file a labor certification or an employment-based visa petition. The regulations do not provide any specific procedures for employers to follow in this instance. The mere fact that an employee currently in nonimmigrant status requests an employer to sponsor him or her for lawful permanent residence should not be cause for questioning his or her employment eligibility. However, a request for sponsorship should raise questions where an employee has previously indicated on the I-9 form that he or she was a lawful permanent resident or U.S. citizen.

Given the notable increase in DHS's worksite-related enforcement, it is advisable that employers ensure that they follow up promptly and resolve Social Security no-match letters. Compliance with the "safe harbor" process described above may be somewhat complicated. With the publication of the final regulations, DHS will likely be more aggressive with employers that DHS believes have not sufficiently followed up appropriately after receiving Social Security no-match letters.

At the front end of employment, employers may wish to verify that new employees' names and Social Security numbers match the SSA's record. Employers can use the SSA's Internet verification service, which allows them to verify up to 10 names and SSN's (per screen) online and receive immediate results. The SSA's website for this service is located at http://www.ssa.gov/employer/ssnv.htm. The website also has information on what to do in cases where the employer's and SSA's records do not match.