The I-9 Internal Audit

by Ken C. Gauvey

After filling out the initial I-9, the next step to ensuring compliance with the I-9 regulations is to conduct an in-house audit. Employers need to be careful when conducting an internal audit as mishandling an audit creates a potential for charges of discrimination. Title VII makes it illegal for an employer to discriminate on the basis of race or national origin. So, for example, if an employer only focuses on those employees who appear to be foreign nationals in an I-9 internal audit, the employer is subject to discrimination charges. To avoid such charges and to ensure a successful audit, an internal audit should follow certain guidelines.

First, it is necessary that an employer ensure that an internal audit is not based on race or national origin. This may be accomplished by auditing all I-9 forms or by auditing a truly random sample of I-9 forms. A company may not selectively choose which I-9 forms to audit. To do otherwise is to invite a discrimination action.

Second, an employer should consider an I-9 self-audit on an annual basis, which may eliminate complaints that an employer is only conducting targeted audits. The audit should mirror as much as possible an actual government compliance audit. This step not only verifies the I-9's on file, but it also helps the human resources department to be better trained to act under an actual government compliance audit.

Finally, an employer must keep copies of all the I-9 verification documents or none of them. An employer cannot keep verification documents for some employees and not others. While performing the audit, if it is discovered that some I-9's have copies of the verification documents and others do not, then those that are missing should be obtained or the employer should not retain the copies of those that it has in its possession. So far, Colorado is the only state that requires employers to maintain copies of all verification documents with the I-9 forms.

To conduct an internal audit, it is necessary to obtain a complete list of employees, current employees as well as those whose employment has been terminated within the past three years. The I-9 form for each employee should then be obtained and compared to the list of employees to ensure that all the I-9's are held by the company. The I-9 forms should be kept in a separate file from the employee's personnel file for a number of reasons. Chief among these is the fact that if an agent receives the employee personnel file along with the I-9, they will read the entire personnel file and have the authority to pass on the information they gain to other areas of the government. The Department of Labor and the Department of Homeland Security are working together and communicating with each other.

I-9's should be kept for terminated employees for three years from the date of hire or one year after termination, whichever is longer. I-9's falling outside of these time frames should be destroyed and the date the I-9 was destroyed should be written on the employee's file in case there are ever questions as to whether an I-9 was ever completed. It is a good idea to keep two binders, one for current employees and the other for terminated employees. The transfer of that I-9 should then be added as a "to do" item whenever an employee is terminated.

When performing an internal audit, great care should be taken in changing the information on an I-9 form. The person making those changes should initial and date the new information with a note such as "corrected during self-audit"listed beside the date. Information should not be deleted but rather crossed out with a single line and the correct information written above it with initials and date added. This demonstrates that the forms have not been "doctored" but rather a self-audit resulted in the discovery of errors which were then immediately corrected to show compliance with federal regulation.

Immigration practitioners should be consulted if there are any question in the employers mind that might need clarification. I-9 compliance is a significant issue these days with a number of high profile raids conducted by Immigration and Customs Enforcement ("ICE"). Employers should take the necessary steps to ensure that they are not susceptible to the steep civil and criminal penalties associated with poor management of I-9's.

Kollman & Saucier, P.A., The Business Law Building, 1823 York Road, Timonium, MD 21093   Phone: 410-727-4300
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