This past weekend, Oakland’s Mayor Libby Schaff warned of imminent U.S. Immigration and Customs Enforcement (“ICE”) activity in the San Francisco Bay Area. Mayor Schaff’s announcement was made after ICE agents issued Notices of Inspection to approximately 77 restaurants and other businesses in Northern California during the first week of February 2018. News outlets are reporting that more than 150 arrests resulted from the recent enforcement efforts. ICE also reported issuing 122 Notices of Inspection to businesses and making more than 200 arrests in the Los Angeles area the week of February 16, 2018.
What appears to be a focus on California and “sanctuary cities” is not surprising given the Trump administration’s position regarding immigration and recent enactment of laws like California’s AB 450 that are intended to “interfere with federal immigration enforcement authorities.” Given this climate, businesses must be prepared in the event ICE comes knocking on their door. Employers and human resources professionals will find information below regarding California’s AB 450 and their responsibility under federal law.
Does Your Company Complete Form I-9s?
All employers must complete the Form I-9, Employment Eligibility Verification, for all employees hired after November 6, 1986, which includes owners of the company. The Form I-9 requirement was a result of the federal Immigration Reform and Control Act of 1986 (“IRCA”). IRCA specifically prohibits employers from knowingly hiring workers who are not authorized to work in the United States. One example of a “knowingly hiring” scenario is when the worker confides to the hiring manager that he is undocumented or is not legally authorized to work in the U.S. An employer’s “constructive knowledge” may also establish a knowingly hiring violation. Constructive knowledge occurs when one unreasonably seeks to remain ignorant of a fact or facts by failing to make usual and proper inquiries (i.e., the person should have known). In the immigration context, constructive knowledge that an applicant or employee is not authorized to work in the U.S. may be supported by evidence that the employer failed to complete the Form I-9 for workers.
IRCA also prohibits employers from continuing to employ an individual knowing that the worker is not authorized to work in the United States. This “continuing to employ” scenario is likely to occur with the cancellation of Temporary Protected Status (“TPS”) for nationals from El Salvador, Haiti, Nicaragua and Sudan. For example, most individuals with TPS are able to obtain a work permit, known as an Employment Authorization Document or EAD, that allows TPS recipients to legally work for a period of approximately two years. Every two years, the EAD expires (absent any automatic extension by the Department of Homeland Security). TPS recipients must renew their work permit with the federal government. The employer must reverify on or before the expiration of the EAD currently on file (i.e., by looking at the I-9) that the worker continues to have employment authorization. An employer must reverify the continuing employment authorization (i.e., issuance of an unexpired EAD) on the Form I-9.
An employer’s failure to complete a Form I-9, knowingly hiring an unauthorized worker, or continuing to employ an individual who does not have current work authorization exposes that employer to both civil and criminal penalties.
What is a Notice of Inspection?
A Notice of Inspection (“NOI”) is when ICE issues a notice to the employer to audit the employer’s compliance with federal law, specifically that the employer completed a Form I-9. Employers are required by law to maintain the original Forms I-9 for all current employees and make them available for inspection by ICE pursuant to an NOI. In the case of former employees, retention of Forms I-9 are required for a period of at least three years from the date of hire or for one year after the employee is no longer employed, whichever is longer. Forms I-9 should be stored apart from the personnel file or other documents not related to the Form I-9. Best practice would be to keep Forms I-9 in a devoted file, binder, box, or file cabinet, and secured under lock and key.
When ICE agents serve an employer with an NOI, this means that the ICE has begun its investigation. By law, employers are provided with at least three business days to produce the Forms I-9. Some employers waive this 3-day period. Also, ICE will often request that the employer provide supporting documentation, which may include a copy of the payroll, list of current employees, Articles of Incorporation, and business licenses. Employers may visit the ICE website to read more about the Form I-9 Inspection Overview.
ICE has the authority to impose monetary penalties on employers:
“Monetary penalties for knowingly hire and continuing to employ violations range from $375 to $16,000 per violation, with repeat offenders receiving penalties, at the higher end. Penalties for substantive violations, which includes failing to produce a Form I-9, range from $110 to $1,100 per violation.”
What is an ICE Raid?
A raid occurs when ICE agents enters an employer’s place of business as part of an investigation into the employer. A raid is usually the result of a long-term investigation into the employer’s hiring practices, sometimes following an NOI. ICE’s intent during a raid may be to arrest individuals and/or seize documents that will then be used in supporting a criminal case against the employer. Indictments may also be issued to CEOs, managers, supervisors, and others in the management structure of a company.
For example, on September 28, 2017, ICE in collaboration with the Department of Justice (“DOJ”) U.S. Attorney’s Office announced that Pennsylvania-based Asplundh Tree Experts, Co. would pay $95 million to settle both criminal and civil immigration charges stemming from the company’s hiring and rehiring of undocumented workers over a six-year period. The $95 million (which includes an $80 million criminal forfeiture money judgment and $15 million in civil payment) represents the largest payment levied in an immigration or Form I-9 investigation to date. In 2016, a California company, Mary’s Gone Crackers Inc., agreed to pay $1.5 million and establish a corporate compliance program under a nonprosecution agreement.
What does California’s AB 450 Require from California Employers?
In October 2017, Thomas Homan, ICE’s Acting Director, stated that ICE would quadruple workplace enforcement action in response to AB 450 because ICE believes AB 450 interferes with the federal government’s ability to enforce federal immigration law.
Under AB 450, an employer cannot voluntarily grant:
- Access to any non-public area of a worksite, unless the immigration enforcement agent presents a “judicial warrant” Gov’t Code Sec. 7285.2; or,
- Consent to access, review, or obtain the employer’s employee records (e., I-9s, personnel files, etc.) without a “subpoena or judicial warrant.” Gov’t Code Sec. 7285.2.
AB 450 restrictions on access may minimize disruption to business operations and prevent employees from fleeing the workplace as soon ICE is spotted. These days, though, keep in mind that employees may run because the employee is actually unauthorized or the employee is legally authorized to work in the United States but fears that ICE activity at work may negatively impact a family member(s) who are unauthorized/undocumented. If an employee runs, the employer’s best defense is to present a properly completed Form I-9.
(1) Access to non-public areas
AB 450 prohibits an employer from voluntarily taking ICE beyond a reception area, or the equivalent, in a workplace. Of course, if ICE presents a warrant or subpoena to the employer requiring access, an employer would likely not be in violation of AB 450. AB 450 does permit an employer to take an ICE agent to a non-public area of the workplace where employees are not present for the purpose of verifying that the agent has a warrant or subpoena.
(2) Consent to access, review or obtain employer’s employee records
This provision would not apply to I-9s and other supporting documents for which a NOI was provided to the employer. This prohibition does not restrict or limit an employer’s compliance with the E-Verify Memorandum of Understanding (which, among other things, obligates an employer to cooperate with DHS in their compliance monitoring and evaluation by turning over I-9s and other employment records).
(3) Types of Subpoenas or Warrants
A subpoena is a legal document issued by a court at the request of a party to proceedings to compel a person to produce documents or give evidence at a hearing or trial. In some cases, ICE may issue a subpoena or NOI to inspect the employer’s I-9s and other documentation, including certain wage and hour records for a certain period of time. Depending on the subpoena or NOI for I-9 records, the scope of the request is usually limited to the single facility where the NOI is served.
Immigration agents can enter a private area only if they have a judicial warrant. A judicial warrant must be signed by a judge and say “U.S. District Court” or “State Court” at the top. Without a judicial warrant, immigration agents need the employer’s permission to enter private areas of the facility. AB 450 places limits on an employer’s ability to grant permission without a warrant.
Another type of warrant is an administrative warrant issued by an administrative agency, not a court of law. These administrative warrants may state “Department of Homeland Security” and may be on Forms I-200 or I-205. Administrative warrants do not allow immigration agents the ability to enter private areas without an employer’s permission.
AB 450 was designed to curb potentially disruptive worksite raids (or improper search and seizure). The law carries a pretty steep penalty for non-compliance: two thousand dollars ($2,000) up to five thousand dollars ($5,000) for a first violation and five thousand dollars ($5,000) up to ten thousand dollars ($10,000) for each subsequent violation.
2. Immigration Enforcement Agents
AB 450 uses the term “immigration enforcement agent” rather than simply identifying or referencing ICE or another specific immigration agency. This is likely due to the fact that there are various federal agencies that may exercise its power to inspect Forms I-9, including the federal Department of Labor.
3. Notice to Employees
Under AB 450, once an employer receives an NOI or other immigration-related warrant/subpoena, an employer must post a notice within 72 hours of receiving the NOI and communicate the following to affected employees:
- The name of the immigration agency involved, identified by name, a copy of the NOI (warrant/subpoena) and a statement that the immigration agency will conduct an audit of the I-9s and/or other employment records.
- The date the employer received the NOI.
- The “nature of the inspection” to the extent known.
Labor Code Sec. 90.2(a)(1). The notice must be placed in the same area as all other labor posters required by local, state and federal law. AB 450 also indicates the notice should be translated into another language used by employees.
AB 450 requires the California Labor Commissioner to develop a template on or before July 1, 2018 that employers may use to comply with this new notice requirement. California employers who had the misfortune of receiving an NOI will need to work with their legal counsel to ensure compliance with this portion of AB 450.
4. Notice to the Union Following NOI Results
AB 450 also requires the employer to give notice to the “affected employee’s” authorized representative or union, if any, within 72 hours of the immigration agency’s issuance of the NOI results. An “affected employee” is any employee identified by ICE as potentially lacking work authorization or whose work authorization documents appear to have deficiencies. The employer must do the following:
- Provide, upon a reasonable request, a copy of the NOI to the union;
- Provide the union a copy of the results of the I-9 audit, including any Notice of Suspect Documents (“NSD”). The NDS is a notice that informs the employer that based on a review of the Forms I-9 and documentation submitted by the employee, ICE has determined that an employee is unauthorized to work and informs the employer of the possible criminal and civil penalties for continuing to employ that individual. ICE provides the employer and employee an opportunity to present additional documentation to demonstrate work authorization if they believe the finding is in error. AB 450 requires an employer to provide written notice to certain “affected employees” who ICE claims lack work authorization. This notice must include the following information:
- A description of any and all deficiencies or other items identified in the written immigration inspection results notice related to the affected employee.
- The time period for correcting any potential deficiencies identified by the immigration agency.
- The time and date of any meeting with the employer to correct any identified deficiencies.
- Notice that the employee has the right to representation during any meeting scheduled with the employer.
The manner of providing this second type of notice may be burdensome, depending on the size of the company. The employer must provide notice to each individually affected employee. The notice must relate only to the affected employee and must be delivered by hand at the workplace if possible and, if hand delivery is not possible, by mail and email, if the email address of the employee is known, and to the employee’s authorized representative.
AB 450 imposes a civil penalty of $2,000 to $10,000. However, the fine does not apply if the federal government provides an “express and specific direction or request” to not provide such a notice.
5. Re-Verifying Current Employees is Prohibited
AB 450 prohibits an employer from re-verifying the employment eligibility of a current employee at a time or in a manner not required by the IRCA or that would violate any E-Verify Memorandum of Understanding. AB 450 requires a penalty of up to $10,000 for reverifying an employee’s employment eligibility status in a time or manner not required by federal law.
Under federal law, an employer may be required to reverify employees in the following situations:
- When an employee has an expiring EAD;
- In connection with a federal contract with a FAR E-Verify clause;
- When an employee comes forward with a new identity and basis of work authorization;
- As part of an internal audit when an employee has not presented sufficient documentation; and,
- As part of a government audit which calls into question the work authorization of one or more employees.
Under federal law, employers should not reverify U.S. citizens and noncitizen nations; lawful permanent residents who presented a Form I-551, Permanent Resident or Alien Registration Receipt card for Section 2 (this includes conditional residents); and List B documents (identity documents for Form I-9).
6. AB 450 Does Not Require Violation of Federal Law
Despite all these additional requirements, AB 450 states the new law should not be interpreted as requiring the employer to violate IRCA, INA or other federal law.
- Train staff. Train the front desk or reception area to notify the owner or other designated person about an ICE visit and escort the immigration agent to a designated public waiting area. The designated person should then contact legal counsel to ensure the subpoena or warrant grants the access requested by ICE.
- Train Staff on Completing a Form I-9. Review USICS I-9 Central. I-9 Central is the Department of Homeland Security’s public resource that provides guidance on how to properly complete a Form I-9.
- Audit Your Company’s Forms I-9. Read ICE’s “Guidance for Employers Conducting Internal Employment Eligibility Verification Form I-9 Audits.” A first step in auditing the I-9s is ensuring there is a Form I-9 for all current employees by looking at the latest payroll record and verifying all current employees completed a Form I-9. The second, and likely complicated step, is to ensure that all I-9s are properly completed. If there are I-9s that are not completed or not properly completed, the employer should contact legal counsel to obtain guidance on completing the Forms I-9 without violating California law.
- Contact Sutton Hague. Our firm can represent employers through the Form I-9 process, including during a worksite enforcement action.