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I-9 Compliance: Requirements, Rules, and Regulations For Employers

by Karyn H. Rhodes | SHRM-SCP, SPHR on Sep 28, 2021 5:04:30 AM

Bringing on new employees can be an exciting time for your business. But it can also be challenging to make sure you’re meeting all the legal requirements when hiring. One of the steps many companies get wrong is Form I-9 compliance. And if you’re in certain industries, the risk of an audit – and serious penalties – is very high.

Complete Payroll Solutions’ certified HR professionals help organizations of all sizes and in all industries comply with the rules and regulations governing the onboarding of new employees. We know there’s a lot of paperwork to worry about, and it can quickly get complex and overwhelming, especially when the guidance is evolving due to COVID-19 and ongoing remote work environments.

To help you understand what you need to do to stay in compliance with the law, here we’ll discuss:

  • What is Form I-9
  • Who needs to fill out a Form I-9
  • What documents are acceptable for Form I-9 compliance
  • Does Form I-9 have to be completed in person
  • When must Form I-9 be completed
  • How long do I have to keep Form I-9
  • What are the penalties for non-compliance
  • How can I stay compliant with Form I-9

After reading this article, you’ll know how to make sure your I-9 policies and procedures are compliant so you avoid steep fines.

What is Form I-9?

Form I-9 is used by employers to verify the identity and employment authorization of those you hire. All US employers must properly complete Form I-9 for each employee, whether they are citizens or noncitizens. Both you and your new hire have to complete certain sections of the form.

Who needs to fill out an I-9?

Both you and your new employee – or their authorized representative – will need to complete Form I-9. First, your employee needs to attest to their employment authorization in Section 1 and present acceptable documents that show their identity and employment authorization. You’ll then need to review the documents to make sure they appear genuine and record the information in Section 2 of Form I-9.

What documents are acceptable for Form I-9 compliance?

The employee has several options when it comes to acceptable documents that establish their identity and employment authorization.

  • List A: Your employee may provide 1 of the documents from this list that establish both their identity and their employment authorization:
    • US Passport or US Passport Card
    • Form I-551, Permanent Resident Card or Alien Registration Receipt Card
    • Form I-766, Employment Authorization Document Card
    • Foreign Passport with Form I-94 or Form I-94 with Arrival-Departure Record and Endorsement to Work
    • Passport from the Federated States of Micronesia or Republic of the Marshall Islands with Form I-94 or Form I-94A
    • Foreign Passport Containing a Form I-551 Stamp or Form I-551 Printed Notation
  • List B + List C: Employees must provide both a document that establishes their identify from List B and one that establishes their employment authorization from List C:
    • List B
      • Driver’s License
      • ID Card Issued by a Government Agency or Entity
      • School ID
      • Voter Registration Card
      • US Military Card or Draft Record
      • Military Dependent’s ID Card
      • US Coast Guard Merchant Mariner Document Card
      • Native American Tribal Document
      • Driver’s License Issue by a Canadian Government Authority

Individuals under 18 can also present a school record or report card; clinic, doctor or hospital record; or day care or nursery school record.

  • List C
    • US Social Security Card
    • Form FS-240
    • Form FS-545
    • Form DS-1350
    • Original or Certified Copy of a Birth Certificate Issued by a State, County, Municipal Authority or Outlying Territory of the US
    • Native American Tribal Document
    • Form I-297, US Citizen ID Card
    • Form I-179, Identification Card for Use of Resident Citizen of the US
    • Employment Authorization Document Issued by the Department of Homeland Security

Do I-9’s have to be completed in person?

During the COVID-19 pandemic, the US Citizenship and Immigration Services (USCIS) had given employers flexibility in complying with the requirements related to Form I-9. While originally set to expire at the end of August, the changes have been extended until December 31, 2021.

As a result of the temporary policy, employers may now obtain and remotely inspect copies of the identity and employment eligibility documents needed to complete Section 2 of Form I-9. This exception only applies to employees who are hired to work exclusively in a remote setting.

For I-9 compliance, when must the form be completed?

The employee must complete and sign Section 1 of Form I-9 no later than the first day of employment. It’s important to note that it should never be completed before an individual accepts a job offer.

You will need to complete and sign Section 2 within 3 business days of the date of hire of your employee. This date is their first day of work for pay. In Section 2, you’ll list both your employee’s first day of employment and the date you examined the documentation they presented to show their identity and employment authorization.

How long do I have to keep I-9s??

To ensure I-9 compliance, you’re required to maintain for inspection original forms for all current employees. For former employees, you must keep the forms for a period of at least 3 years from the date of hire or for 1 year after the employee is no longer employed, whichever is longer.

What are the penalties for noncompliance?

The compliance of Form I-9 is governed by Immigration and Customs Enforcement (ICE). If ICE finds your I-9 records to be noncompliant, you can face a range of penalties, including fines and criminal prosecution. For example, the penalty for failing to produce a Form I-9 where they are either missing or not completed is $230 to $2,292 per violation and fines for knowingly hiring and continuing to employ unauthorized workers range from $573 to $20,130 per violation.  


How can I keep up with Form I-9 compliance?

There are several steps you can take to help avoid issues with your Form I-9 compliance:

  1. Read and refer to the Handbook for Employers (M-274). The M-274 is published by USCIS to help employers better understand the purpose of the I-9. The I-9 can be surprisingly confusing. The handbook should answer many of your questions about compliance.
  2. Store your I-9 forms safely. It is best to keep your I-9 forms in one place — separate from other personnel files — so that sensitive information will not be unnecessarily revealed during an audit.
  3. Perform internal audits regularly. An internal audit is the best way to detect and correct errors. It may also demonstrate a good faith effort that could spare you serious penalties in the event of a government audit.
  4. Avoid employment practices that are considered discriminatory. Employees must be treated equally regardless of citizenship or immigration status, national origin, or native language. Many well-intentioned actions can be considered discriminatory; for example, employers may not ask to see work authorization documents before hiring on the grounds that someone seems foreign or is not an American citizen.
  5. When in doubt, consult a professional. When it comes to I-9s, an ounce of prevention is worth more than a pound of cure. Consulting a professional could spare you hefty fines or even jail time.

If you want assistance to ensure your policies and procedures are compliant, Complete Payroll Solutions’ team of certified HR professionals can help you understand the requirements and what you need to do to ensure you’re following the rules. We can be a good fit for your organization if you:

  • Don’t have a dedicated HR staff in-house
  • Are the subject of an I-9 audit or are concerned about I-9 compliance
  • Would like assistance from a certified HR professional
  • Want help with additional onboarding tasks

It’s important to note that Form I-9 is just one onboarding task you need to worry about. Read our next article on new hire paperwork to understand what else is required of you when bringing on new hires. If you are looking for assistance with HR compliance and want to know more about how Complete Payroll Solutions can help you, our article on our offerings describes the different outsourced services we offer.


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