Failure to Maintain I-9s can Result in Severe Civil Penalties

HR Resource
February 21, 2014 — 2,856 views  
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Non- maintenance of the I-9 forms for new employees can prove to be very costly for a business. A recent judgment in the 9th Circuit court resulted in civil penalties being imposed by the United States Immigration/ Customs Enforcement on an employer based in Washington. The incident has highlighted how important it is for all employers to understand that merely verifying if new hires have the proper legal status in the country is not a substitute for I-9 completion and maintenance.

Fine of Over $170,000 Imposed in Washington Case

In the case of the Washington based employer, Ketchikan Drywall Services (KDS), the negligence led to the imposition of a $173,250 penalty. The case also highlights the fact that small businesses cannot always remain under the radar in his respect. The penalized firm KDS has only four full time staff members and about 20 part timers. As per regulations, the temporary employees  must file the information for their I-9 forms before they commence work on any project. During an audit it was found that KDS had no I-9 forms for more than 40 of its employees. For 65 employees some parts of the form were left incomplete while for 100 others supporting documents were not recorded correctly.

Intent to Comply is not Enough to Prevent Penalties

KDS’s argument that the firm intended to comply with requirements and it’s partial compliance indicates good faith effort did not find favor with the judge. The court rejected the plea that the deficiency was more of a technical nature and held that the ICE’s decision would be deemed final. The judgment clearly shows that that storing copies of relevant documents along with the I-9 form, as KDS had done, instead of completing the form fully in the manner prescribed will not be considered an acceptable alternative.

In the I-9 form there is provision for attestation that the documents presented by the new employee have been reviewed carefully and verified. Since mere presentation of documents does not indicate that they have undergone any such scrutiny, this argument was rejected in court.

In addition, KDS’s stance indicates that it is the ICE’s responsibility to verify documents and ensure that all the business’s employee have valid legal status in the country. This is a clear violation of the regulation that these forms should be fully completed before submission. The case also revealed the importance of filling out a fresh I-9 form even when the same temporary worker is being re-hired for a new project. 

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