United States employers are required to report social security earnings for their employees. Those earnings are listed on reports that include each employee’s name, social security number and earnings. The reports are filed with the Social Security Administration (SSA).

In some cases, the social security number and employee name cannot be matched up in the SSA’s records. In this situation, the SSA sends a letter informing the employer of the “no-match.” United States Immigration and Customs Enforcement (ICE) may issue a similar letter, known as a “notice of suspect documents,” after auditing an employer’s Employment Eligibility Verification forms (Form I-9) and finding evidence that an immigration status or employment authorization document does not match the name of the person on the Form I-9.

Often a no-match occurs as the result of a clerical error, such as a mistake in transcription. No-match situations also frequently arise due to name changes pursuant to marriage or divorce. In other cases, the no-match may indicate that an employee is not authorized to work in the United States.

In the past, no-match letters served to inform employers that they should review their employment records and identification documents to ensure their employees were properly authorized to work. However, there was little in the way of follow-up by the SSA or the Department of Homeland Security (DHS). Today, the situation is substantially changed. In August, 2007, DHS issued new regulations deeming an employer to have “constructive knowledge” that an employee is not authorized to work in the United States upon the employer’s receipt of a no-match letter. The burden is then on the employer to demonstrate that it took the necessary steps to correct or otherwise address the discrepancy.

Action Steps on Receiving a No-Match Letter

When a no-match letter is received, the employer must check its records to determine if the discrepancy resulted from a typographical, transcription or similar clerical error. If such is the case, the employer must correct the error and inform the appropriate agency – either SSA or ICE, depending on which agency sent the letter. The regulations indicate that 30 days is an appropriate amount of time for this step.

If the no-match is not due to a clerical error, the employer should ask the employee to confirm that the employer’s records and documents on file are correct. If they are not, the employer must inform the relevant agency and verify the corrected records with the agency. If the employee states the records are correct, the employer should ask the employee to follow up with the agency to correct the discrepancy. The time frame for this step is also 30 days.

It should be noted that the regulations provide that a discrepancy is only resolved when the employer has received verification from SSA or DHS that the employee’s information matches the record.

Additionally, an employer must verify the employee’s identity and work authorization within 90 days of receiving the “no-match” letter. If the process is completed, an employer will not be deemed to have constructive knowledge that an employee is unauthorized to work. However, if the discrepancy is not resolved, and the employee’s identity and work authorization cannot be verified, the employer should consult with counsel to determine whether the employer should terminate the employee or risk having DHS determine that the employer had constructive knowledge that the employee lacked employment authorization.

The new regulations are currently on hold as a result of litigation. Although the indicated steps and time frames are not necessarily binding on employers currently, employers still must verify their records upon receipt of a no-match letter and take active steps to ensure they are not employing unauthorized individuals. Whatever the outcome of the litigation over these regulations, employers are encouraged to follow the above guidelines, as enhanced enforcement of the work authorization rules in one form or another is certain.

Increased Penalties for Violators

In fiscal year 2006, ICE arrested 716 individuals on criminal charges, including employers and employees, and 3,667 individuals on administrative charges in worksite enforcement investigations. Law enforcement actions involving employers have been brought against individual members of top management. Charges include conspiracy to induce, aid and abet illegal aliens in residing or remaining in the United States; knowing transfer of fraudulent identification documents; immigration fraud; and social security fraud. Penalties for conviction can reach into the tens, or even hundreds, of thousands of dollars in fines to prison terms of up to ten years.

This article is intended only as a brief overview of the subject. For additional information regarding “no-match” letters and other immigration law concerns, please contact the author or Craig Trebilcock at 717-848-5134.