U.S. Immigration and Customs Enforcement (ICE) has issued updated guidance detailing how it conducts employer work eligibility inspections and assesses penalties under federal law.
The guidance centers on Form I-9, the mandatory employment eligibility verification document required under the Immigration Reform and Control Act (IRCA) of 1986. Employers in the United States are legally required to verify the identity and work authorization of all employees hired after November 6, 1986, and to retain those records for government inspection.
Under federal regulations, employers must complete Form I-9 for each employee and maintain it either in paper form or through an approved electronic system capable of producing readable copies. Records must generally be retained for at least three years from the date of hire or one year after employment ends, whichever is longer.
Inspection process
ICE, through its Homeland Security Investigations (HSI) unit, initiates compliance reviews by serving employers with a Notice of Inspection (NOI). Once served, employers typically have at least three business days to produce requested Form I-9 records.
In addition to the I-9 forms, ICE may request supporting documents such as payroll records, employee lists, business licenses, and incorporation documents.
After reviewing submitted records, ICE agents assess whether the forms comply with federal requirements. Employers may be given 10 business days to correct technical or procedural errors identified during the inspection.
Failure to correct those issues can result in them being treated as substantive violations.
Possible findings and notices
Following an inspection, ICE may issue several types of notices depending on its findings.
A Notice of Suspect Documents informs employers that some employee documentation may not be valid or may not relate to the employee in question. Employers are advised of potential penalties for continuing to employ unauthorized workers but are given an opportunity to respond with proof of work authorization.
A Notice of Discrepancies indicates ICE cannot determine an employee’s eligibility based on the documentation provided. Employers must pass this notice to the employee, who may submit additional proof of authorization.
A Notice of Technical or Procedural Failures identifies errors in the completion or maintenance of Form I-9 and provides a correction window.
At the conclusion of an inspection, ICE may issue one of the following outcomes: a compliance letter confirming proper adherence to requirements, a warning notice, or a Notice of Intent to Fine.
Warning notices are typically issued where violations are identified but future compliance is expected. However, they are not issued in cases involving fraud, repeated violations, or failure to correct earlier errors.
A Notice of Intent to Fine may be issued for substantive violations, unresolved errors, or knowingly hiring or continuing to employ unauthorized workers.
Penalties and enforcement
Employers found to have knowingly hired or continued employing unauthorized workers are required to stop the unlawful activity immediately and may face civil fines, criminal prosecution, and potential debarment from federal contracts.
If a Notice of Intent to Fine is issued, employers have 30 days to request a hearing before an administrative law judge through the Office of the Chief Administrative Hearing Officer (OCAHO), part of the U.S. Department of Justice.
Failure to request a hearing results in a final order, which cannot be appealed.
Common violations
ICE classifies several types of Form I-9 errors as substantive violations, including failure to complete the form, missing signatures, incorrect or incomplete employee information, or failure to verify work authorization within required timelines.
Errors in electronic I-9 systems or failure to properly retain records may also result in penalties.
Technical errors, such as missing fields or minor administrative mistakes, may be corrected within a specified timeframe. If not corrected, they can be upgraded to substantive violations.
How fines are determined
Civil penalties are calculated based on the number and severity of violations, adjusted for inflation and the employer’s compliance history.
ICE also considers five key factors when setting penalty amounts: the size of the business, good faith efforts to comply, seriousness of the violations, whether unauthorized workers were involved, and the employer’s prior history of violations.
These factors may increase or reduce the final penalty amount.
Document fraud cases
Separately, ICE may pursue administrative action under federal law against individuals or employers accused of document fraud, including the use or creation of false immigration documents.
Penalties can include cease-and-desist orders, fines, and removal proceedings for non-citizens found in violation.
