– by Pinnacle PEO
Recently, a San Antonio company faced more than $180,000 in fines after U.S. Immigration and Customs Enforcement (ICE) auditors identified more than 100 substantive violations to the company’s Form I-9s – each carrying up to a $2,156 maximum penalty.
Not only did the fine impact the company’s bottom line, but the violations created the likelihood of more stringent oversight to this company from the government and the possibility of steeper fines for future errors pertaining to the documentation of an employee’s work status.
The Form I-9 recently changed, and the penalties for noncompliance almost doubled under an initiative started by former President Barack Obama. ICE is projected to hire 10,000 new agents this year under an executive order signed in January by President Donald Trump, in part to strengthen enforcement of Form I-9 record-keeping rules.
Employers are required to confirm workers’ eligibility for employment by completing the Form I-9, but the forms can be tricky for small business owners. It’s not a difficult form, but as most small businesses, including Sport Clips franchises do not have an onsite Human Resources department, they may have Team Members who are not well trained in completing the Form I-9. This can lead to mistakes being made that can result in thousands of dollars in penalties. Many employers mistakenly think that companies who get fined have illegal workforces, but that is simply not true. The forms can just be filled out incorrectly, and the companies can still be fined. In addition, some employers believe that only certain industries are inspected by ICE. Some industries are more inclined to be audited then others, but any company can be subject to an audit.
The individual who completes the form, in most cases a Sport Clips Manager, must attest, under penalty of perjury, they have examined the documents the employee has presented to them. They must attest, to the best of their knowledge, that the workers are authorized to work in the U.S. Pinnacle representatives cannot complete these forms for the Managers, as they are not the individuals who examined the documents in person. Further, the Sport Clips franchisee is responsible for maintaining these original records for up to three years after the termination of the Team Member. In an industry with high turnover, the potential for fines is even greater.
Here are three ways you can limit the threat to your company from mistakes on the Form I-9:
Train your Team Members on how to complete the Form I-9 correctly
ICE offers a free on demand webinar that can be viewed at https://www.uscis.gov/i-9-central/form-i-9-webinar-demand-entire-video. ICE also offers a Form I-9 overview webinar several times a month. ICE provides the dates and times at the first of each month, which are listed on our Events Calendar.
Pinnacle is here to help as well. We have sample Form I-9s we can provide and we can conduct comprehensive one-on-one training for Team Leaders and Managers. Our training is driven by practical examples to ensure your Managers truly understand and recognize the importance the Form I-9 plays in your business.
Conduct regular I-9 reviews
Many businesses fail to review their Form I-9 forms until an ICE audit is scheduled. At that point, an assessment is too late. Sport Clips franchisees should establish an ongoing internal review plan to be conducted at regular intervals. Pinnacle’s Human Resources department can assist with the audit process by providing you with a checklist and also helping to review these forms.
In addition to identifying potential mistakes, a regular review process might be helpful in demonstrating to federal investigators that the company is taking meaningful steps to prevent violations.
Establish a policy to terminate Team Members who do not provide proper documentation or misrepresent employment status
Develop a written policy pertaining to correctly completing the Form I-9 and calling for the termination of Team Members who do not provide proper documentation to comply with the law. A clear policy can be beneficial to the employer as it may show a good faith effort on the business that they are taking the necessary steps to ensure they are hiring Team Members with authorization to work in the U.S., Pinnacle’s Human Resources team can provide guidance in developing a policy that works well for your business.
An example of such mistake is hiring someone who only provides you with identification from List B of the Form I-9, such as a driver’s license as proof of eligibility without providing something from list C, like a social security card. The employee has three days to provide you with all of the appropriate documentation. Allowing someone to work beyond the three days without appropriate documentation could increase the risk of larger fines.
Our goal is to provide you with the tools necessary to assist in workplace compliance. For general questions, please email HR@pinnaclepeo.com, or any of our Human Resources representatives directly.