AH&LA opposes the Dept. of Homeland Security’s use of Social Security databases to issue documents which could increase a business owner’s liability over their employee’s citizenship status.

SUMMARY

The Social Security Administration (SSA) as part of its routine record-keeping functions has sent notices to employers informing them that one or more of their employee Social Security numbers that have been provided by the employer do not match the name in the SSA database.

Known as "no-match" letters, SSA had sent these letters in the past to help ensure that their records are accurate—an important measure to ensure that each worker receives the credit for social security benefits which they have earned.

In an August 2007 rulemaking that was a significant departure from past policy, the U.S. Department of Homeland Security (DHS) announced it now considers the receipt of a no-match letter as possible "constructive knowledge" of the employment of an unauthorized worker. The new rules implemented at that time by DHS increased an employer's obligations and potential liability after the receipt of a no-match letter.

DHS No-Match Regulation
Under the new August 15, 2007, regulation, DHS required employers to take certain actions upon receipt of a no-match letter in order to resolve the discrepancies noted in the SSA letter.

If the employer does not take these actions, or if the employee continues to work without correcting the discrepancies, the employer may be viewed as having knowledge that they are employing someone not authorized to work in the U.S. and be subject to prosecution.

DHS proposed that employers who receive no-match letters that in order to protect themselves from liability and prosecution they must to the following to qualify for a "safe harbor":

• Within 30 days, check their records for any administrative error that may have caused the no-match.
• If the no-match was not a result of an administrative error, ask the employee to verify the accuracy of the employer's records.
• If the employee believes the records to be accurate, ask the employee to resolve the issue directly with the SSA.
• If the employer is able to correct the no-match, DHS has outlined a series of steps to correct SSA's records.

If the no-match cannot be resolved within 90 days of receiving the no-match letter, DHS requires that the employer and employee complete a new Form I-9 (Employment Eligibility Verification) with certain requirements.

If the steps established by DHS are completed and it is determined that the employee is authorized to work in the U.S., DHS will not consider the employer to have constructive knowledge of an unauthorized worker's status.

DHS also recommended in its regulation that employers participate in the E-Verify program which allows employers to electronically verify the work authorization status of their employees.  Information on the E-Verify system can be found on this AH&LA Webpage.

The specific actions required by employers to resolve disputes were to be included in all future "no-match" letters. Guidance was also found on the U.S. Immigration and Customs Enforcement (ICE) Website.  Questions and answers on the procedures can be found via the link, as well as updated news.

STATUS

Although DHS formally issued these new rules, on October 10, 2007, the U.S. District Court for the Northern District of California issued an injunction against their implementation. This injunction is a result of a lawsuit brought against DHS asserting that the department did not follow the proper procedures in determining the burden the rules would place on business and that the rules constitute a misuse of the Social Security database.

In early 2008, DHS announced that it was moving ahead with a supplemental rule-making to the No-Match rule published in 2007.  The supplemental No-Match proposed rule was published in the Federal Register on March 26, 2008.  AH&LA issued an Advisory on the supplemental rulemaking and urged its members to reply before the April 2008 deadline.

However, bowing to the judicial system and business community outrage, the Dept. of Homeland Security announced July 8, 2009, that it will be rescinding the notorious “No-Match” rule proposed by the department in 2007.  The rule was blocked by court order shortly after issuance and never took official effect.  The department explained that its E-Verify program better addresses data inaccuracies that resulted in “No-Match” letters being issued and provides a better tool for identifying individuals using fraudulent identification documents or combating illegal employment.

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For more information, contact AH&LA Senior Vice President for Governmental Affairs Shawn McBurney at (202) 289-3123, smcburney@ahla.com.

(Updated July 2009)