I-9 Compliance and the high cost of mistakes

Now I know that most the people who read the title of this entry are already saying something along the lines of, “tell us something we don’t already know” or “we’re already familiar with the penalties for hiring illegal workers”.

That’s the interesting part. It seems like everyone I talk to assumes that the I-9 form is only checked for whether or not the employee on it is legally allowed to work in the U.S., and they couldn’t be more wrong!

The perfect example of this was publicized toward the end of 2010 – Abercrombie & Fitch was fined over $1 Million for violations of I-9 forms… and Abercrombie & Fitch hires NO illegal workers! The fine was because of paperwork violations. Even more impressive is that this fine wasn’t a result of a companywide audit, rather ICE (Immigration and Customs Enforcement) inspected only A &F’s Michigan stores! (According to their website, Abercrombie has a total of 9 stores in Michigan)

One of the big violations uncovered in the audit was related to technology and issues with their electronic I-9 verifications. It looks like the vendor failed to confirm the system was accurate, or did a poor job of training on the program. Either way, it adds up to a big hit to Abercrombie.

What the average business owner should take away from this is simple: Get your house in order! Just because you don’t think you hire illegal workers doesn’t mean you’re immune from ICE audits. If you utilize electronic I-9 systems, are you sure that the system is complaint? Do you know who is responsible for checking that your I-9’s are correct and have been checked? Just because you have a 3^rd party “taking care” of your I-9’s doesn’t mean that you’re off the hook.

Now more than ever, it’s in a business owner’s best interest to keep a close eye on the I-9 process they use. The new policy at ICE means that not only are businesses getting audited and investigated long before the business is ever notified, but that issues uncovered during audits are being used as the base for CRIMINAL penalties in addition to civil.

Don’t let this happen to you. The easiest way to prevent this is to have someone take a look at your I-9’s with a fresh pair of eyes. The cost incurred to have a consultant audit your company will save you money, headaches and quite possibly criminal charges.

Joshua Brown is the Co-Founder and a Managing Principal of the Kansas City based HR consulting firm, G & J Consultants, LLC. G & J Consultants specializes in providing small and medium sized businesses with traditional HR services as well as compliance with employment laws and regulations.