How to lose $600K: Failure to Comply with Form I-9 Rules

This is a cautionary tale for anyone who thinks I-9s are a racket. (If you are not sure what an I-9 is, I recommend you start here and here). 

In July of this year, the Office of the Chief Administrative Hearing  found Hartmann Studios  guilty of over 800 counts of I-9 violations, all of which were paperwork violations.  What did these 800+ counts cost Hartmann Studios?  A $605,250.00 fine

Whoa. What happened? 

An I-9 audit is what happened.  It turns out the Immigration and Customs Enforcement (a.k.a "ICE") showed up and demanded an audit of all Form I-9s.  As it would later be revealed, Hartmann was not properly administering its employees' I-9s, resulting in a very large monetary fine.   Keep in mind these audits are often random, meaning any company at any time. 

What was Incorrect?

It was more about what was missing.  ICE found 797 I-9s missing Section 2 or otherwise showing an incomplete Section 2.  Section 2 is the part where the Employer verifies documents provided by the Employee and inputs the data into the appropriate columns.  There is also a signature block for the Employer's representative certifying that the documents reviewed appear legitimate and are correctly described.  If this section is left blank, the presumption is that no documents were ever verified by the employer which is frowned upon by the Feds and against USCIS regulations.  There were also 4 employees with no I-9s on record, 8 I-9s missing from Hartmann's database, and a variety of missing signature lines.   

How do I Prevent this?

1- Make sure all your employees (and certain past employees) have an I-9 on record.

2- If you notice a missing I-9, get it filled out right away.  Put the revised date on the form (do not backdate) and attach a signed note stating the noticed error and your subsequent correction, as well as the date the new form was filled out.   Similarly, if you notice a section missing, you should do the same. Always keep the old I-9 and the new I-9.

3- Keep good, secure records.  I-9s should be housed in a secure database held separate from employment files.  It can be digital or it can be paper.  It just needs to be secure (a.k.a confidential) and organized. 

4- Make sure your employees properly fill out the Form I-9 AND make sure your supervisors are well-versed on how to administer the Form I-9 properly.  

5- When in doubt, call your attorney.  Let us help you on the front-end, instead of the back-end.  It is much easier to pay an attorney a little bit now than to pay ICE $600K later.