The Office of Fraud Detection and National Security (“FDNS”) is part of the United States Citizenship and Immigration Services. FDNS’s mission is to detect, deter, and combat immigration benefit fraud. FDNS consists of approximately 650 Immigration Officers, Intelligence Research Specialists, and Analysts located in field offices throughout the United States. In addition, FDNS has contracted with multiple private investigation firms to conduct site visits on its behalf. In 2010, FDNS intends to increase its H-1B site audits to 25,000 – a fivefold increase. If you are unlucky enough to be chosen for one of those 25,000 site audits, what should you do? The American Immigration Lawyers Association has provided suggestions.  This post contains some of those site audit basics and recommendations for preparation.

What Happens During an H-1B Site Audit?

H-1B site audits are usually unannounced, and take place at either the employer’s principal place of business or the foreign national’s physical work-site location. During the site visit the investigator will often ask to speak with the employer representative who signed the H-1B Petition. If this person is unavailable, the investigator usually requests, as an alternative, to speak with a Human Resources representative. During the audit, the investigator will typically ask specific questions to verify the representations made by the employer in the H-1B Petition, and may also request a tour of the facility. In addition, the investigator may ask to interview the H-1B employee about his/her job title, duties, responsibilities, employment dates, position locations, academic background and previous employment experience. Finally, the investigator may request the opportunity to speak with colleagues and/or managers of the H-1B employee.

How Should an Employer Respond to the Audit?

If an employer is subject to an unannounced H-1B site visit, the employer should immediately request that its immigration attorney be present. Even though the investigator will not reschedule a site visit so that an attorney may be present, the investigator will allow counsel to be present by phone. The employer should also have procedures in place to ensure that the investigator is directed to a designated company official. That designated official should request the name, title, and contact information for the site investigator. If the investigator introduces himself/herself as a contractor of FDNS, the employer’s representative should request a business card and confirm the investigator’s identity before permitting the individual to enter the employer’s premises, and before providing any detailed information about the employer’s business.

The employer should have at least two employer representatives accompany the investigator during the site visit. One representative should be the primary spokesperson on behalf of the employer. The second representative should take detailed notes of all information requested by and provided to the investigator, the locations visited, pictures taken, and/or any other relevant information from the site visit.

If the employer has strict policies regarding audio recording, photography, or video recording, the employer should advise the investigator accordingly. If the investigator requests information from the employer and the employer cannot provide accurate information without further research, the employer should so inform the investigator, and offer to contact the investigator as soon as the requested information is obtained. Under no circumstances should the employer “guess” about any information requested during the site visit.

Prepare for Site Visits Before They Occur.

An adverse assessment by the FDNS could be used to deny a petition, if the site visit occurs during re-adjudication, could result in a revocation of a previously approved petition in the post-adjudication process, and/or could be referred to U.S. Immigration and Customs Enforcement (“ICE”) for further investigation. A referral to ICE could lead to civil or criminal penalties and prosecution. Given the potential consequences of an adverse audit, and because most H-1B site visits are unannounced, employers must be prepared for such visits well in advance.

Ensuring that required documentation is up-to-date and is easily accessible is the best way to prepare for a site visit. Specifically, employers should retain complete copies of all submitted I-129 petitions and supporting documents in confidential files, and be familiar with and ensure the accuracy of the representations made in the I-129 petitions. With respect to each filed H-1B Petition, the employer must maintain a public access file. Employers should also ensure they are in compliance with any mandatory employment posting obligations to prepare for the possibility the investigator will request a tour of the facility.

To better prepare the designated official for possible questioning by the investigator, consider staging a mock visit under the supervision and direction of counsel and subject to the attorney-client privilege. To prepare the beneficiary for potential questioning, employers can consider providing a redacted copy of the I-129 Petition and supporting documents to the beneficiary, including information on the nature of the job opportunity, the terms and conditions of employment, and the beneficiary’s education and prior work history. A mock interview of the beneficiary, with counsel present, can also be helpful.
 

In a final rule published today in the Federal Register, the Department of Homeland Security (“DHS”), has rescinded its controversial “no-match” letter regulation promulgated during the Bush administration. The action has been anticipated ever since it was initially announced in July, and completes a process which commenced with the publication of a proposed rule on August 19, 2009. The Bush era regulation never went into effect because its enforcement was preliminarily enjoined by a federal district court.  The significance of the rescission is explained below.

A no-match letter can be generated by the Social Security Administration (“SSA”) when a combination of employee name and Social Security Number (“SSN”) on a W-2 form does not match SSA records. This can occur for a variety of entirely innocent reasons, but can also occur when someone not authorized to work in the U.S. uses a false SSN or someone else’s SSN. The Bush era regulation would have required employers receiving such letters to take particular actions to resolve the discrepancy and verify the individual’s employment eligibility or face potential liability for employing an unauthorized alien.

Rescission of the regulation does not mean that SSA will stop issuing no-match letters. Moreover, in the text addressing public comments on the rescission, DHS has made it clear that receipt of a no-match letter will continue to count in a totality of the circumstances determination of whether an employer knowingly hired or continued to employ an unauthorized alien. As a result, employers that receive such letters should continue to investigate them with the employees to whom they apply. DHS states that the prudent employer will: check its own records for errors; ask the employee to review the information; and allow the employee a reasonable amount of time to resolve the no-match with SSA.

In order to avoid potential liability under the anti-discrimination provisions of 8 U.S.C.§ 1324b, employers who receive a no-match letter should also refrain from taking precipitous action against the affected employee. DHS states unequivocally that employers should not use a no-match letter alone as a basis for firing an employee. The Justice Department’s Civil Rights Division provides guidance to employers on how to respond to a no-match letter without engaging in prohibited discrimination.
 

E-Verify is a free, Internet-based system operated by the Department of Homeland Security (“DHS”) and the U.S. Citizenship and Immigration Services (“USCIS”) in partnership with the Social Security Administration (“SSA”). E-Verify enables participating employers to electronically verify the employment eligibility of their employees based upon electronic information and records maintained by the DHS and SSA databases. As of September 8, 2009, many federal contractors and subcontractors are required to use the E-Verify system to confirm whether their employees are eligible to work in the United States. This change is the result of the final version of the applicable Federal Acquisition Regulation (“FAR”). The scope of coverage of the new rule is described below. DHS, SSA and USCIS have a variety of informational resources on E-Verify on the USCIS website, www.uscis.gov.

 

E-Verify and Federal Contracts and Subcontracts

Prior to September 8, 2009, the use of E-Verify was voluntary and applied only to new hires. As of September 8, 2009, however, the final rule requires the insertion of the E-Verify clause into applicable federal contracts. If the contract contains the E-Verify clause, federal contractors are obligated to use the E-Verify system not only for all new hires, but for all existing employees “assigned to the federal contract.” That includes any employee hired after November 6, 1986, who is directly performing work in the United States under a contract that includes the clause committing the contractor to use E-Verify. An employee is not considered to be directly performing work under the contract if the employee normally performs support work, such as indirect or overhead functions, and does not perform any substantial duties under the contract.

Not all federal contractors and/or subcontractors are subject to this new E-Verify requirement.  The final rule calls for inclusion of the E-Verify clause in prime federal contracts with a performance period of more than 120 days and a value of more than $100,000. With respect to subcontractors, the E-Verify clause will normally be included in subcontracts if: (i) the prime contract includes the clause; and (ii) the subcontract is for services or for construction with a value of more than $3,000. In addition, the final rule does not apply to contracts that include only commercially available off-the-shelf (“COTS”) items (or minor modifications to a COTS item) and related services. Nor does it apply to contracts where all work is performed outside the United States.

The final rule also recognizes some exceptions to the requirement to use E-Verify for all new hires. For instance, institutions of higher education, state and local governments, federally recognized Indian tribes, and sureties operating under a takeover agreement with a Federal agency pursuant to a performance bond may choose to only use E-Verify for those new hires who are assigned to perform work on the covered federal contract.

Participation in E-Verify has some benefit to the contractor. While it does not a provide safe harbor from work site enforcement, it does create a rebuttable presumption that the federal contractor or subcontractor has not knowingly hired an unauthorized alien. In this regard, contractors are responsible for monitoring the E-Verify system and following-up with employees if a non-verification response is received from the E-Verify system.

Overview of the E-Verify Employment Verification Process

Companies awarded a contract with the E-Verify clause after September 8, 2009, will be required to enroll in E-Verify within 30 days of the contract award date. After enrolling, federal contractors have up to 90 days to initiate verification queries for all new hires, whether employed on a federal contract or not, as well as existing employees who are working directly on the federal contract.

After the 90-day phase-in period, the federal contractors will be required to initiate verification of each newly-hired employee within 3 business days after the employee’s start date. Federal contractors may choose to initiate the verification of a newly-hired employee prior to the start of employment. However, the federal contractor may only verify an individual’s employment eligibility if the following conditions have been met: (i) the individual has been offered the position; (ii) the individual has accepted the job offer; and (iii) the individual has completed the Employment Eligibility Verification Form I-9.

Posting Requirement

Contractors participating in E-Verify are required to post the notice provided by DHS indicating the employer’s participation in the E-Verify program, as well as the anti-discrimination notice issued by the Office of Special Counsel for Immigration-Related Unfair Employment Practices at the Department of Justice. These postings must be placed in prominent locations that are clearly visible to prospective employees and all employees who are to be verified through the E-Verify system.

Pending Litigation

Mandatory use of E-Verify by federal contractors and subcontractors has been challenged in the courts. In August 2009, the District Court of Maryland upheld the legality of the final rule in Chamber of Commerce, et al. v. Napolitano (Aug. 26, 2009). The district court’s decision has been appealed.