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New regulations issued regarding Social Security ‘No-Match’ letters

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in Leaders & Managers,Management Training

by Robert Johnson and Deanna Benjamin, Ogletree Deakins, Atlanta

The U.S. Department of Homeland Security (DHS) has issued new final regulations detailing how employers must respond to Social Security “no-match” letters. That means employers that receive no-match letters now have new legal obligations when it comes to verifying and maintaining federal I-9 Employment Eligibility Verification documents.

‘No-match’ letters

The Social Security Administration (SSA) annually receives millions of W-2 Forms on which an employee’s name doesn’t match the Social Security number (SSN) on file for that employee. In some of those cases, SSA sends an “Employer Correct Letter,” also known as a no-match letter.

There are many innocent reasons why a name and number might not match—someone’s name may have changed, or there may have been a clerical error. But it’s also possible that a name and number don’t match because the employee is using a fraudulent SSN and is not authorized to work in the United States.

Not every employer gets no-match letters. They typically go only to employers with many name-and-number discrepancies.

Employer sanctions

An employer faces fines and possible criminal sanctions if DHS finds the employer had “constructive knowledge” it was employing illegal immigrants. A no-match letter is one factor that should trigger questions about the employee’s legal status.

The new rules include two specific examples when DHS may deem an employer has constructive knowledge that it employs an illegal worker:

  1. When it receives a no-match letter.
  2. When it receives written notice from DHS that a document presented by an employee as proof of authorization to work (one of the original documents the employee provided to prove his or her identity) is assigned to another person or that DHS has no record of the document.

Safe harbor

The new regulations establish a “safe harbor” for employers that get a no-match letter. Employers that follow the safe-harbor rules probably won’t be charged with constructive knowledge that an employee isn’t authorized to work in the United States.

Employers have 30 days to either correct clerical errors or ask the employee to correct the error directly with SSA or DHS. If the matter can’t be cleared up within 90 days, the employer must choose between terminating the employee or risk that DHS will conclude the employer has constructive knowledge it’s employing an illegal worker (see box below for details).

Temporary stay

Recently, a federal district court judge granted a nationwide temporary restraining order placing a hold on DHS’s final no-match regulations. The final regulations were scheduled to take effect on Sept. 14, but now won’t until at least Oct. 1. That’s when the judge will consider whether to extend the restraining order. The ruling also put a hold on the federal government’s plan to start sending out no-match letters.

Employers should continue to watch for new developments in this issue. Nonetheless, take this opportunity to review current no-match procedures and immigration-compliance procedures. The federal government probably will continue to impose more stringent I-9 compliance obligations on employers in the near future.

Robert Johnson is a shareholder and Deanna Benjamin is an associate in Ogletree Deakins’ Atlanta office. The firm represents management in immigration-related matters.

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