Navigating This Summer’s New I-9 Compliance Deadlines with John Fay of Equifax Workforce Solutions

William Tincup: [00:00:00] This is William Tincup, and you’re listening to the RecruitingDaily Podcast. Today we have John on from Equifax Workforce Solutions, and our topic today is navigating this summer’s new I 9 compliance deadlines. And so we’re going to be off to the races. John, would you do us a favor and both, introduce yourself and EWS?

John Fay: Absolutely. And thank you so much for having me on your program. My name is John [00:01:00] Fay, and I’m the director of product strategy at Equifax Workforce Solutions, EWS, where we are focused, among other things, on helping employers through our software and related services throughout the HR lifecycle. So onboarding, active employment, off boarding, but my focus in particular is on the I 9 form.

In a former life, I was a practicing immigration attorney. I’ve spent a lot of time helping employers figure out this deceptively simple form. And if I can begin the podcast actually with a confession I really do like I 9s. It may seem odd to express enjoyment of a government form. And my wife likes to remind me that I’m probably in the small minority, but I really do find them interesting.

And I’m happy to geek out with you on I 9s today.

William Tincup: So what’s been going on with I 9s just in the last, obviously with COVID. I’m sure things changed, or at least probably in practice, maybe not the legal part, but in practice, things have changed. And what’s the [00:02:00] summer look like?

What are the changes that people need to be aware of?

John Fay: Yeah. And to answer that question, I think first I’ll provide just a little bit of background. I’m sure all your listeners already know this, the Form I 9 for many years, it’s always. It’s an in person affair. It’s the longstanding rule is that when you’re completing on nine for a newly hired employee, you need to actually meet with them and you need to inspect documents, right?

You need to actually look at the passport, the driver’s license, the Social Security card, whatever they Want to present you. That’s an acceptable document. And then, of course, along came covid and the whole idea of a physical inspection became obviously something that was just not possible for a period of time.

And so the government, to their credit, came out with this really what I would say is an extraordinary exception. I say extraordinary because for many years we would say to them, Hey, will you just allow a virtual review of documents, use a camera, wouldn’t that be great? People are hiring,[00:03:00] folks all over the country.

Can we do that? And they would always say no, that’s, it’s a risk. We, what if the documents are fraudulent? And so they would never do that. But, of course, extraordinary circumstance calls for extraordinary solutions. And so they came up with this rule that basically said that if you’re an employer and you’re operating remotely on your hiring employees, during the pandemic here, you can virtually or remotely inspect their documents.

You can do it by video. You can do it by email. You can even do it by fax. I don’t know too many people with,

William Tincup: Hey, it’s an option.

John Fay: Exactly. We appreciate the flexibility, but the one catch and the thing that I’m afraid a lot of employers, maybe they didn’t read the fine print and we, and it’s totally understandable.

I’m an attorney and I know that people don’t read fine print, but it was that this was just a deferral. Of the physical inspection process. It wasn’t like, Oh [00:04:00] yeah, now you can just virtually review documents. It was, you can virtually review documents, but eventually you got to do, you got to meet with these folks in person to see those documents.

And so now, obviously pandemic went on a lot longer than we all thought it would. And but now the government, with the ending of the national health emergency in May. The government has followed suit and said, okay, guess what, everybody, you now need to, we’re ending this program.

So as of July 31st, you can no longer use this program that I’ve been describing. And on top of that, by August 30th, you need to do all those physical inspections that you may or may not have done.

William Tincup: Oh, wow. So now they’ve got to go backwards to whatever, whoever they hired. Yeah. And and also I 9s also, if I’m right, if they carry through the employment if you’ve let those people go.

What happens in that situation where you hired somebody who took the virtual documents and now you’ve let them go for whatever reason, or they’ve moved on for whatever reason. Do you still have [00:05:00] to go back and how do you, if so, how do you get those documents? Or how do you verify

John Fay: those documents?

Yeah, no, it’s a great question. Unfortunately the government is not. Turning us all into, having to go and chase down graded employees. So what they say is if you’ve had a, an employee that has a separated for whatever reason, you fortunately all you need to do is to go back to that I 9 form.

Just explain, write a note, say they’re separated and write the date down. So they’re reasonable in that respect at least. That’s,

William Tincup: that’s nice. But the going backwards and going forward. If the employees were hired during that period where you could take virtual documentation, now they have to go and they have to go and capture, not capture, but they have to verify it, right?

This sounds like Reagan. Was it Reagan that said trust and trust, but verify? I can’t remember. But so now they have to go back and verify all that documentation. And then with anybody new, it’s gotta be in person.

John Fay: That’s right. That’s that’s the big change. And it’s just, it’s [00:06:00] impactful for organizations really for obvious reasons, right?

It’s because now more than ever, everybody’s just, they’re hiring remote. And to be honest with you William, a lot of employers, they didn’t really, I don’t want to say misuse the program and maybe they didn’t understand its full intent. The program was intended purely for employees who were operating or working remotely because of COVID.

But, nowadays you have a lot of organizations that are just hiring and using this program, even though it has nothing to do with COVID, it’s because, they’re on the other side of the country, for example.

William Tincup: No, and it makes sense. But so if they, and they have to have those files verified by what date, August 30th.

So if that person’s been working in Topeka. Headquarters is in San Francisco. At one point, they’ve got to get that person to come to the headquarters.

John Fay: So fortunately, there is a solution for this. It’s been in the law for a while, not necessarily understood or used [00:07:00] widely, but employers for physical in person inspections can use what’s known as an authorized representative.

And so basically what that means is the, yeah, the employer can say, Hey I’m going to designate. You know somebody out in Topeka who is, you know nearby and you can go And you can, visit that person and do the physical inspection. So there are

William Tincup: ways. Is that an employee or is it more like getting something

John Fay: notarized?

So it can really, so it’s an interesting requirement because it can be, technically it can be anybody. And the government has even said so. On the forms. So we’ve seen in these situations employers and it really depends on the employer. Sometimes they’ll say you can go to anybody as long as they’re over the age of 18.

You can go to you can go to a notary. Now it’s not a notarization, but you can go to a notary, since they’re familiar with looking at documents and they can do this. The challenge is there’s what I said earlier. There’s so many rules with I 9s, Then all of a sudden now you have [00:08:00] somebody who doesn’t know them and ultimately the employer’s on the hook.

William Tincup: Years ago, if I remember correctly, years ago, I nines had to be separated in the employee file. This is a hundred years ago when I worked in hr, but at that time, I nines, they had to be in a separate folder. So within or separate area kept separately. So that people could see that documentation. Has it, has that changed or is there anything

John Fay: different with that?

It’s still the best practice. And the reason, you remembered correctly. And the reason for that, by the way, it’s a really practical reason. It’s not actually written into law, but it’s, the reason you want to keep them separate is in the event of An audit or an I 9 inspection. Generally, you only have three business days to turn over those I 9s.

Yeah. You know what happens if it’s mixed in with HR files. Oh, good gosh.

William Tincup: Yeah. But to have them separately, you just pull that entire file and go, okay, here you go.

John Fay: Yeah. And so what happens is then you never [00:09:00] want to obviously, turn over more than you need to.

William Tincup: So the first due date. The August due date is there was two day to two day.

John Fay: Yeah, that’s correct. So the July 31st date is the date that you can no longer for any new hire use this virtual program. And then August 30th date is the date they have to do those physical inspections of anybody who you previously virtually reviewed.

William Tincup: And out of all the folks that you deal with in HR, how many folks how many folks do you think one out of a hundred actually know the due dates?

John Fay: So it’s interesting. I would say, normally I would say that, the awareness of these types of things can be challenging because, the government announces it on a website. It’s hard to disseminate. Yeah. We’ve been, I don’t know, I can just tell you our company, we’ve held multiple webinars, articles.

We’ve done a lot, so I can tell you that at least our clients are fairly, highly aware of these deadlines, but I will say, I [00:10:00] actually I spoke at the SHRM annual conference just a few weeks ago, and there are a few, when I started mentioning it, that wide eyed, deer in the headlights look I’m sure there’s a few out there that don’t know.

William Tincup: Oh, yeah. And again, knowing and then doing, because here we are at the end of June, it’s okay, the first deadline’s coming up pretty fast. You’ve got to, as an HR person, you’ve got to not just Change your process a bit, you’ve got to inform recruiters, hiring managers, everybody about how things have changed.

So it’s an internal communications thing as well. Now, the second part is, leans pretty heavily on HR to then get now their process is officially different and now they’ve got to go forward, but again, that’s communications

John Fay: as well. Yeah, and I’m actually glad you mentioned communications because I like to mention this whenever I’m able to speak on this topic.

If you’re out there and you’re doing the, if you’re worried about that August 30th date to do the physical inspections, [00:11:00] I highly recommend a very good and thorough communication plan to explain to employees Why you’re doing this, because in my experience, a lot of new hire employees may not have any notion.

The fact that this was a temporary thing that it was a deferral of the physical inspection requirement. And so they might think, Oh, virtual review of I 9s is normal, especially when you consider so much of other HR paperwork can be done remotely. And so it’s very important to explain to them that you’re doing this in order to fulfill a legal requirement.

And I say that only because one of the number one complaints that’s investigated by the Department of Justice has to do with I 9 related discrimination. When an employee feels, Hey, somebody’s asking me for additional documents that I don’t think it’s right. And the best way that we combat that. Is through communication.

William Tincup: So obviously the audience is going to wonder what if, what if we, don’t comply or [00:12:00] what if we, just push the deadline, et cetera, like what are the penalties, what is the compliance comes on the other side of it comes with, okay, if you don’t do this, here’s what could

John Fay: happen.

Yep. And it’s a great question because, it’s a lot of work and we always have to calibrate and measure risk. So the what we’ve heard from the government is that if employers do not conduct these physical inspections, they will treat it as what’s known as a substantive violation. And in the I9 world which doesn’t sound good, right?

In the I9 world,

we have two different types of violations. We have substantive, which basically equates to serious. And then we have technical, which can be minor things. Oh, I forgot the date of birth. I forgot the address, something small. They’re going to treat it as substantive. And what that means is if you were inspected by Immigration and Customs Enforcement, which is known as ICE they’ll ask for your I 9 forms.

And if you have [00:13:00] not conducted a physical inspection by August 30th, and they treat it as a substantive violation, you would be subject to a fine. And fines have been increasing with inflation because there’s a… The civil monetary penalties are increasing every year. But of course, we know inflation is has been making that even more and so it’s anywhere from 272 all the way up to 2, 701 per I nine form for a substantive. And yeah, and you might say, yeah, that’s up. And it’s a pretty broad spectrum. But what I would say is if you have more than 50% errors on your forms, which unfortunately a lot of organizations do, especially those that are doing them on paper, then you’re probably closer to about 2000 you’re at about that 2, 000 per I 9 range.

So yeah, it adds up very quick.

William Tincup: A number of questions. One is you mentioned if you’re still doing them via paper, which I would assume that’s 100 years ago when I was doing them. That’s what we did, right? It was all paper. So assuming that there’s technology that you can [00:14:00] do, that you can capture all the I 9 information in.

Yeah,

John Fay: absolutely. In 2006, the government introduced regulations which enable employers to electronically generate and complete and store I nine forms. They then came up with a final regs in 2010. And so since that time to your point, a lot of organizations now are completing I nines using software, which obviously has a lot of benefits, right?

So the cloud, yep, it’s in the cloud. You can, in the event you’re audited, you can actually produce the I nine forms. You’d have to go running around the different offices, picking them up. And obviously a lot of, solutions that that, we and other providers offer have error checking and other types of things to help reduce some of those risk rates.

William Tincup: So sometimes people that I talk to especially they, I don’t know if they get confused or if they [00:15:00] can delineate the E Verify and I 9 process. So I’m sure you deal with this too. So what’s the major differences between

John Fay: the two? Yeah. And so the way I describe you verify is it’s like a sister program or an extension of the I nine form.

And I nine, of course, we all know it’s required for every single newly hired employee in the United States. Verify ahead. And what’s its

William Tincup: purpose? Is it to verify the I nine? Is it to verify that someone’s a citizen? What’s what is its, what is it? If you could boil that down.

I’m sure it has multiple purposes, but Yeah. What do you, what’s its purpose from the government’s perspective?

John Fay: From the government’s perspective it’s actually quite simple. It’s ensuring that. Employers are hiring a legal workforce. Got it. So since 1986, there was the Immigration Reform and Control Act, which was signed by President Reagan.

And what that did, interestingly, is it essentially deputized HR folks. [00:16:00] They now have a job they probably didn’t want, which is they’re the ones that are Which is a bunch,

William Tincup: which a bunch of, there’s a bunch of jobs in HR that HR doesn’t want.

John Fay: Fair enough. And so that law did a variety of different things, but for purposes of our discussion, it was the birth of the I 9 form.

And ever since then, they now need to, they need to review documents and they need to review an employee’s attestation and say, okay, is this person authorized to work? But of course, they’re just reviewing documents, right? How do they know for sure? And so what E Verify does, if an employer participates, Is it then that gives them an electronic notification that says, okay, based on government records this employee is authorized to work or Hey, maybe not.

Maybe it’s there’s a mismatch and we have to go, figure out what to do.

William Tincup: What’s your take with employers? Should they marry the two? Should they have, obviously they’re doing AI nine. Should they use E Verify?

John Fay: So years ago, I was very lukewarm on E Verify, primarily because it was a [00:17:00] pilot, technically it is still a pilot program, oddly enough, but it relies primarily on social security records, and I think many of us know that social security records were not necessarily designed for purposes of determining work authorization, and there’s a lot of errors in them, right?

Just simple problems like names name changes alone. We know many times people get married, they change their name for other reasons and they don’t update social security. There’s just a lot, all kinds of potential issues. I’ve been very lukewarm on it. Now, what I will say to their credit is that over the years they have improved it, they’ve added additional checks.

They’ve added, a photo matching process with certain types of documents. And I think the real. Challenge for HR folks is a lot of states across the United States have taken it upon themselves to mandate E Verify if you have employees and operations in those states. Yeah, so like Arizona, where I am, we were one of the first states to require it across the board.

And so [00:18:00] then, if you’re a large organization or even a smaller one, if you’ve got multiple, state locations, then it can become burdensome. It’s okay, which states do I need to do E Verify? Which ones do I not? And then maybe it might make sense to, consider, having a uniform strategy.

So

William Tincup: I 9s are for employees, as I remember them these are either, these are hourly or salaried employees. Do they also, are they for gig workers or part time or? Like where is the, what’s the line of demarcation of where they need I nines and when they don’t

John Fay: Yeah. So it really is the demarcation is just anyone who enters into an employer, employee relationship. So typically where the I nine falls off is if you have somebody who is a contractor, right?

William Tincup: W two versus W

John Fay: four. Exactly. Yeah. And so those are the ones that you don’t have to necessarily you, you wouldn’t complete an I 9.

William Tincup: And [00:19:00] so what government agency enforces I 9s?

Who’s the backbone of making sure that I 9s are… Your records are kept

John Fay: well, so there’s because on lines are so interesting and I like them so much. There’s actually a trio of agencies that yeah, the more the merrier, right? The primary one that we think of.

Often is that first one I mentioned, which is immigration and customs enforcement, right? Because they’re the ones, they’re the ones with the guns and the badges that come and ask for your I 9s. So they’re one, but then you have United States Citizenship and Immigration Services or USCIS.

They own the form. And so they produce the form and actually there’s going to be coming a new form coming out. They also own the E Verify process. And then the last one, Yeah, which is interesting. And the last one is the Department of Justice, Immigrant and Employee Rights Group or IER. I’m throwing so many acronyms out.

Oh, yeah. But these guys are on basically the other side [00:20:00] of the coin from ICE. And they’re mostly interested in making sure that employees Are not being discriminated against during the process.

William Tincup: So you said you described a new form coming out. Is that’s in line with the deadlines?

John Fay: It’s interesting.

Yeah, it is. It is. So if you were to pull up a form right now and you’re hiring a new employee, you looked at the form and you looked at the top right hand corner, you will notice it has an OMB, which is office of management and budget. It’s the Paperwork Reduction Act, which always cracks me up because the on end forms have been getting longer but regardless, it has an expiration date that says October 31st, 2022.

And so this version of the form that everyone’s been using all this year is technically expired, but the government says that’s okay. We are coming up with a new form. It’s coming. It’s coming. They’ve given us a couple drafts. We’ve seen it. It’s still not out yet, but we know it’s coming and the rumor, this is a rumor, is that August will be the [00:21:00] time when we may see the new 499

William Tincup: version.

And that form, the new form will then just go forward with new employees. That’s right. You won’t have to go back day. You won’t have to go backwards. No, thank God. Yeah. So for HR practitioners that again, these are good things to know that you’ve got July due date, you’ve got an August due date, you’ve got a new form coming, but that’s going to impact everything going forward, which again is a process, an internal process.

It’s also a communication to make sure that you’re using the right forms, I want to get back to something you mentioned earlier around technical errors. What do you see is the most as a normal, again you got software that can detect where errors happen, but what do you see is where mistakes get made most frequently?

John Fay: Yeah, I would say a lot of times it is in the documents. So if we’re if we’re thinking about from a paper form perspective in when you’re reviewing a person’s documents, you have to write all this kind of information down. You have to write [00:22:00] the document title. You have to write the issuing authority.

The number, the expiration date, and in a paper world, for sure, people just either forget things. They don’t necessarily know where to find a certain document. Sometimes they’ll choose documents which don’t match what the employee indicated that they were, right? Like I say, I’m a U. S. citizen and I show you a green card.

That’s inconsistent. So we do see a lot of those types of errors. In the paper world. And then I think the other thing that’s really just a huge challenge for organizations is just timeliness. So there are certain time frames for both the employees part of the form and the employers and, again, to use that negative sounding word.

If you don’t complete the online on time, if they substantive violation, you can’t fix it. You can’t go back in time. And so that’s another challenge. Are you,

William Tincup: at least again, this is a hundred years ago we used to have the I 9s done before they started work. Now, again, that, I don’t know [00:23:00] if that was just our company, it was Walmart.

I don’t know if that was just our company or just the way that things worked. But what is the what’s the best practice for I 9s? Is there a certain time period in which they have to have their I 9 completed?

John Fay: Yes, so the rule is that the employee has to complete section one on or before the first day of work for pay, and then typically the documents need to be reviewed, the section two needs to be completed by the employer within three business days thereafter of the first day of work.

And the best practice, if you can do it, not every organization can do it, is as you described, is to do it. If you can do it before the first day of work, then that’s certainly great. The only caveat is you just need to make sure that you have an offer of employment has been made and accepted.

You’re not allowed to pre screen. But

William Tincup: it seems like this would be a great thing to do in onboarding. If you’re doing it, if you’re doing this in onboarding, it just becomes another bit. In the many things that get done in onboarding, it’s just okay, we’re going to [00:24:00] go through this process.

Let’s get it all done. We’ll get, you get your part done, employee. We’ll get our part done, get it verified. Everything’s done. And then it’s just, especially with a new form coming and a new process coming. Exactly. Just seems like that would be the best way. And so it doesn’t. So the, again, everybody’s busy.

That’s the thing in HR that most people outside of HR don’t, they don’t understand. They go into their week already 80% booked. With busy stuff that they’ve got to get done. So like they can’t go backwards. That’s why all the, that’s why a lot of the questions I’ve asked about going backwards.

It’s that’s terrifying for a lot of HR. Yeah, for sure. So last question, is there any other is there any other things I9 related that we should be thinking about for the rest of the year or even into 24?

John Fay: Oh boy. Yes there’s plenty. I’ll just wet the appetite here cause I know we’re running out of time, but there is a, there is a brand new rule that is being considered that would essentially create a.

Semi permanent [00:25:00] virtual review program. So the one we were talking about was specifically for COVID. The government is getting a lot of feedback. And so they have been considering it’s in the regulatory process right now, a permanent rule that would enable employers to review documents remotely without an in person inspection at all.

Yeah, and so we’re monitoring that really closely. It’s probably not surprisingly going to have several strings attached to it, right? So you verify is going to be mandatory. As far as we know, if you want to use this, you’re going to have to keep copies of documents, obviously, but they’re they were talking about other things like required document fraudulent or fraudulent document training and other things we did.

So we don’t really know what it’s going to look like, but Right. If it does come out, it would potentially really, revolutionize and change this process. Let’s hope it

William Tincup: does. Again, you need the process is there for a reason. And I’m not as much of a geek about I 9s as you are, but I understand their importance.

Like I get why they’re important [00:26:00] and it would be nice to see anything that we can do to make it easier for both the employee that’s coming into work, but also the employer to make sure that they’ve, check the box and they’ve got all their paperwork in order. And it’s easy again, if audited.

That’s it’s just easy. It’s Oh yeah, here’s all the files. Go have a nice day,

John Fay: right? Yeah, absolutely. I couldn’t agree more. I think it’s going to be an interesting program. It’s going to be one of those things like so much not in compliance. Every employer is going to be different depending upon your industry, your risk profile and the like, but it’s nice to have options and it’s nice to modernize, right?

It’s, this has been the same process since 1986 and yeah, we could use some modernization.

William Tincup: Well, John, this has been fantastic. Thank you so much for coming on the show.

John Fay: My pleasure. Thank you. Thank you again for having me.

William Tincup: Absolutely. Thanks for everyone listening. Until next time. [00:27:00]