Fencing company knew ICE suspected unauthorized aliens, yet failed to re-verify with I-9s

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By Joy Waltemath

By Lorene D. Park, J.D.

The Tenth Circuit denied a fencing company’s petition to review an administrative law judge’s imposition of civil penalties for violating the Immigration Reform and Control Act (IRCA), 8 U.S.C. §1324a. An investigation by Immigration and Customs Enforcement (ICE) indicated nine employees were unauthorized and the employer received notices from ICE but failed to re-verify employment eligibility as required by Form I-9 and applicable regulations. This was sufficient to show the company knowingly continued to employ unauthorized aliens. Although the employer claimed it had the employees orally confirm authorization and argued that they appeared eligible because they had bank accounts, mortgages, and driver’s licenses, that was inadequate. The petition was also denied as to a paperwork violation (Split Rail Fence Co., Inc. v. U.S.A., December 20, 2016, Matheson, S., Jr.).

I-9 employment verification system. The IRCA requires employers to verify the identity of employees and ensure eligibility to work in the U.S. by examining documents listed in 8 U.S.C. §1324a(b) and by completing and retaining I-9 forms. It is unlawful to knowingly hire an unauthorized alien; to hire someone without complying with the I-9 system; or to continue to employ an alien knowing he or she is unauthorized.

2009 NSD, 2010 settlement. In June 2009, ICE inspected the employer, Split Rail Fence Co., to determine IRCA compliance. On September 11, ICE sent a “Notice of Suspect Documents” (NSD) identifying individuals who appeared to be unauthorized and for whom documentation did not satisfy Form I-9 requirements. The NSD listed 32 current employees and 51 terminated employees and stated that unless they presented valid identification and eligibility documentation, they would be considered unauthorized and further employment would result in civil penalties.

The president and owner of Split Rail attested that the company quickly served the NSD on the 32 named current employees and the 23 who failed to affirm authorization were terminated. Nine others, who orally and on video verified that they were authorized to work in the U.S., continued to work there. ICE served a Notice of Intent to Fine (NIF), and the company settled in June 2010.

2011 NSD, NIF, and penalties. In June 2011, ICE again inspected Split Rail and again issued a NSD listing nine current employees and one terminated employee who appeared unauthorized or for whom documentation did not satisfy I-9 requirements. All but one had been named in the 2009 NSD and the company owner attested they had merely orally verified authorization. ICE served an NIF and commenced administrative proceedings.

In a February 2012 letter to ICE, the owner of Split Rail claimed he had “no reason to believe” the nine identified employees were “anything but law abiding residents” of the USA. Many were long-term employees and each appeared authorized because they had bank accounts, cars, and homes. Many had driver’s licenses and some received workers’ comp. The letter made no mention of actions concerning I-9 forms.

ICE’s complaint alleged an IRCA paperwork violation as to an employee hired after the 2009 NSD for whom Split Rail verified eligibility with his Mexican passport and temporary I-551 stamp authorizing employment until September 13, 2010. The company failed to re-verify his authorization or update his I-9. ICE also alleged a knowing violation by continuing to employ 9 individuals listed on the NSDs. The administrative law judge granted summary decision for ICE on both counts and Split Rail sought review by the Tenth Circuit. Noting that the requirements for summary decision are the same as for summary judgment under Rule 56, the appeals court found no genuine issue of material fact.

Paperwork violation. As for the individual who Split Rail considered eligible based on his Mexican passport and I-551 stamp, the company never completed Section 3 (”Updating and Reverification”) on the I-9 and continued to employ him after his temporary authorization expired. This was enough for summary decision. The court explained that Section 3, the Form I-9 instructions, and 8 C.F.R. § 274a.2(b)(i)(vii) all required Split Rail to re-verify his authorization on or before the expiration date and to provide information on his new documentation in Section 3, which it failed to do. Though the employee incorrectly checked off that he was a “lawful permanent resident,” Split Rail should have caught this mistake. It was not relieved of the duty to fill out Section 3.

Knowingly continued to employ. Split Rail’s petition was also denied on the claim that it knew of nine employees’ unauthorized status and continued to employ them. After detailing the process for establishing a prima facie case, the appeals court concluded that evidence of notice to Split Rail (the two NSDs and 9 “Certificates of Nonexistence of Records”) that ICE’s investigation suggested the employees were unauthorized, coupled with the company’s failure to take adequate steps to re-verify eligibility was enough for a prima facie case. Further, Split Rail failed to rebut this showing of the employees’ unauthorized status and its constructive knowledge that they were unauthorized.

The appeals court explained that receipt of a sufficiently specific NSD requires re-verification and if the employer does not show that it re-verified with documentation required by Form I-9, it cannot rebut the government’s showing. Here, the challenges to the sufficiency of the NSDs fell flat because they were specific enough. Furthermore, the company’s response to the 2009 NSD was to orally ask employees to affirm they were authorized and this was inadequate. Likewise, the re-verification efforts described by the company owner in his letter were inadequate.

Also, while Split Rail tried to challenge the government’s computer records search and results, the affidavit offered by the company presented only general allegations that the records system was unreliable and Split Rail alleged no specific facts sufficient to prove the findings as to its nine employees were incorrect. Nor did the company provide any documents listed in Section 1324a sufficient to rebut the government’s showing that the employees were unauthorized. Summary decision was therefore properly granted.

Source:: Employment Law Daily Newsfeed


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