Undergoing an I-9 Audit: An Employer’s Guide To Managing Compliance
Did you know an I-9 audit can happen at any time? They can arise because an employee or competitor reports a tip or the US Immigration and Customs Enforcement (ICE) suspects you’ve committed a violation – or even randomly without any cause. Either way, an audit can be stressful for you and your company. But you can ease the burden by taking some proactive steps to ensure I-9 compliance. Let’s find out what they are.
In this article, we’ll discuss what a Form I-9 audit is, who conducts them, how you’ll be notified of an upcoming review, what happens in an audit, and how you can best prepare. After reading this, you’ll know what you need to do to ensure your processes will protect you in the event of an I-9 audit.
What is an I-9 audit?
I-9 audits confirm that you’re following proper hiring processes, which includes verifying the identity and employment eligibility of new hires in the US. This requirement comes from the Immigration Reform and Control Act of 1986, which mandates that all employers complete an I-9 within 3 days of hire when bringing on a new employee.
The I-9 has three parts:
- Section 1: Employees fill out this section, which asks for information about their identity and employment eligibility.
- Section 2: You’ll complete this section after reviewing and verifying the employee information and documentation.
- Section 3: The third part, if needed, is for reverification and rehires such as when the employee’s documentation expires.
Employers must ensure all I-9s are properly completed to ensure compliance in the event of an audit.
Who audits I-9 forms?
The audits are performed by the US Department of Homeland Security’s Immigration Customers and Enforcement (ICE). These officials will typically come to your workplace or the location where your forms are stored. It’s important to note that these offices don’t need a warrant to conduct an I-9 audit; however, they will issue a Notice of Inspection, which will give you at least 3 days’ warning.
How will I be notified of an audit?
As we just mentioned, if you’re selected for an I-9 audit, you’ll either receive a Notice of Inspection from ICE by certified US mail, return receipt requested, or investigators may just arrive at your business with the notice in hand. Once you receive this notice, you’ll have 3 business days to gather all your I-9 documentation.
If you refuse or delay an inspection, you may be in violation of the law. That’s why it’s important to have all forms accurately filled out, properly stored, and easily accessible.
What happens during an I-9 audit?
During an audit, you’ll need to provide the I-9s and a current list of workers so they can compare and check for any discrepancies.
Accuracy is key here. So that means you need to make sure:
- You are not missing I-9s
- Part 1 and 2 of each form is filled out correctly as well as Part 3 if you’ve made any changes to employment status or are reverifying/rehiring
- Everything is signed and dated
If, during the review, the officials find a problem, you’ll receive a notice in writing that will let you know the nature of the issue. There are several types of notices you could receive:
- Notice of Suspect Documents: This notice advises the employer that ICE has determined that an employee is unauthorized to work and advises 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.
- Notice of Discrepancies: This document advises the employer that ICE has been unable to determine their work eligibility. The employer should provide the employee with a copy of the notice, and give the employee an opportunity to present ICE with additional documentation to establish their employment eligibility.
- Notice of Technical or Procedural Failures: This type of notice identifies technical violations identified during the inspection and gives the employer 10 business days to correct the forms. An example of a technical violation is omission of the employee’s maiden name or other names used in Section 1. After 10 business days, uncorrected technical and procedural failures will become substantive violations.
- Warning Notice: This notice is issued in circumstances where substantive verification violations were identified, but circumstances do not warrant a monetary penalty and there is the expectation of future compliance by the employer.
- Notice of Intent to Fine (NIF): In certain cases, this notice may be issued for substantive, uncorrected technical violations and for knowingly hiring and continuing to employ unauthorized workers. Penalties for I-9 paperwork violations can be as high as $2,360; for knowingly hiring and employing unauthorized workers, the fines range from $590 for a first offense to $23,607 for a third offense.
Fortunately, with regular internal audits, which we’ll talk about next, you can help avoid compliance missteps when ICE officials arrive.
How do I prepare for an audit?
The best way to prepare for an I-9 audit is to perform regular self-audits at your company. These reviews can also demonstrate a good faith effort that could spare you serious penalties in the event of a government audit so you’ll want to keep track of the dates you conduct your review.
During a self-audit, you should:
- Confirm you have completed forms for all employees
- Check for any expired immigration documents and have a docket system for reverifying
- Ensure employees correct any errors. ICE recommends the employee draw a line through the error, enter the correct or omitted information, and initial and date the correction. If there are so many errors that using the original I-9 would be prohibitive, you’d want to have the employee complete and sign a new I-9 using the current date (but the correct hire date should be entered in Section 2).
- Review your process for making sure the forms are completed on time and correctly and properly stored, meaning that they’re kept separately. Remember that, for terminated employees, you’ll need to retain I-9s for 3 years after their date of hire or for 1 year following their date of termination, whichever is later.
You’ll also want to make sure your organization is prepared if you’re audited and if an ICE inspector arrives. That means training those who will be dealing with the officials that they:
- Should not allow them to speak to employees
- Can approve their request to use a space to review the files
- May request a subpoena if the inspectors ask to see any other employee information from their personnel file
How to Best Stay I-9 Compliant
While an I-9 is required for everyone you hire in the US, there’s a lot more to compliance than just completing the forms. From specific timelines and documentation requirements to storage rules, there’s a lot to consider – and a lot at stake. For more guidance on I-9 compliance, read our next article on requirements, rules, and regulations for employers.
Editor’s Note: This blog was originally published in October 2021 and has been updated in October 2022 for accuracy.