$305,000 in Employer Fines Upheld for I-9 Violations
$305,000 in Employer Fines Upheld for I-9 Violations
Human resources can be complicated these days. Few would argue with that. But sometimes it’s the most basic human resources processes that can cause the greatest damage to any organization when not done right. And that disaster can be compounded if you lack a skilled professional to provide oversight.
When I say any organization, that includes any college, university, church, ministry, hospital, nonprofit or for-profit company, and even youth camps. Small organizations are not immune. No matter what size or kind of organization you are, if you employ staff, you must be diligent in following state and federal employment laws.
Recently, DLS Precision Fab, an LLC in Phoenix, Arizona, assumed they had made the right decision in hiring what appeared to be a seasoned HR professional. Much to their chagrin, despite his credentials, the human resources professional they hired proved inept and derelict in his duties when it came to maintaining the administration of the firm’s I-9s.
What is an I-9, you ask? Well, if you employ people and don’t know what an I-9 is, that’s a huge red flag, right there! Here is the definition as provided by ICE, the U.S. Immigration and Customs Enforcement:
Form I-9 is used for verifying the identity and employment authorization of individuals hired for employment in the United States. All U.S. employers must ensure proper completion of Form I-9 for each individual they hire for employment in the United States. This includes citizens and noncitizens. Both employees and employers (or authorized representatives of the employer) must complete the form. (Source)
We, as an established HR firm, are continually astonished that organizations think that because they are a school, church, camp, or nonprofit, the I-9 is not a requirement. The law clearly states: “All employers must complete and retain Form I-9, Employment Eligibility Verification, for every person they hire for employment on or after Nov. 6, 1986, in the U.S., as long as the person works for pay or other type of payment.”
All employers must have I-9s for every employee, regardless of the employer type or size!
Back to the case concerning DLS in Arizona, they were in a growth mode and had conscientiously made an effort to comply with state and federal employment laws by hiring an HR professional to handle compliance. Unfortunately, as the appeal by DLS states, the HR professional failed in his duties:
DLS is a company located in Phoenix, Arizona, providing custom sheet metal fabrication in a variety of industries. In the late 2000s, DLS grew to about 200 employees because of the expansion of a Department of Defense program. To deal with the sudden growth of its workforce and ensure its compliance with applicable state and federal employment laws, DLS hired a well-credentialed human resources director (the “HR director”). Unbeknownst to the company, however, this individual shirked his responsibility to ensure the company’s compliance with the INA to the point, as later described by DLS, “of literally stuffing the government’s correspondence in a drawer and never responding.”
Their legal problems started in 2009, when ICE served DLS with a notice of inspection and an administrative subpoena. After the onsite visit and a thorough review of their I-9 forms, DLS was served a notice of suspect documents. In October 2012, ICE served a notice of intent to fine.
DLS quickly responded by requesting a hearing before an administrative law judge, and ICE countered by filing a six-count complaint alleging that the employer failed to comply with employment verification requirements and continued to employ 15 individuals despite knowing they were ineligible for employment, all in violation of the Immigration Nationality Act.
Now, in 2017, in an attempt to reverse the violations, DLS Precision Fab appealed—and promptly lost. Richard Clifton, assigned to the case through the Ninth Circuit Court of Appeals found DLS Precision Fab liable for 504 of the 508 alleged violations, 489 of which were I-9 paperwork violations and 15 of which involved DLS Precision Fab’s ongoing employment of ineligible aliens. As a result of the actions of the so-called HR professional, DLS Precision Fab was ordered to pay civil money penalties totaling more than $305,000.
Understandably, this has landed the company in dire straights, and it is now is in the midst of Chapter 11 bankruptcy proceedings. While we can’t be sure that these violations are solely responsible for the bankruptcy filing, it certainly hasn’t helped, adding to their already stressed organizational longevity.
Perhaps, like DLS, you assume your HR staff are competent and on top of complying with all your legal requirements. But are you sure?
The first thing you should you do is have all of your HR processes independently audited by a human resources processional, one with the right experience. We can help. Our HR Assessment, conducted by our skilled team of HR professionals will determine whether you’re protected or at great risk. We help clients across the country. Don’t hesitate—it could be costly.
Contact us today to find out more, and learn about our HR Assessment here.
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