DHS Finalizes I-9 Employment Verification Form Rule Relating to Electronic Storage and Reminds Employers of Importance of I-9 Audits

On July 21, 2010, the U.S. Department of Homeland Security (DHS) announced that it had finalized a regulation that provides greater flexibility for employers to electronically sign and store I-9 forms, which are used by U.S. Immigration and Customs Enforcement (ICE) to verify employment. The Final Rule, published in the Federal Register on July 22^nd , becomes effective on August 23, 2010.

Before 2006, employers were required to store the paper I-9 forms for later inspection by DHS and ICE. Since 2006, employers have been functioning under an Interim Final Rule relating to electronic storage. Pursuant to public notice and comments to the Interim Final Rule, minor modifications made in the Final Rule clarify:

Employers must complete a Form I-9 within three business (not calendar) days
Employers may use paper, electronic systems, or a combination of paper and electronic systems;
Employers may change electronic storage systems as long as the systems meet the performance requirements of the regulations
Employers need not retain audit trails of each time a Form I-9 is electronically viewed, but only when the Form I-9 is created, completed, updated, modified, altered or corrected; and
Employers may provide or transmit a confirmation of a Form I-9 transaction, but are not required to do so unless the employee requests a copy.

According to ICE, this rule provides additional flexibility for employers, including more options for data compression, fewer storage requirements, and more options for storage systems.

In its Press Release, ICE reminds employers of its focus on I-9 audits in the workplace. It states that in April 2009, DHS updated worksite enforcement guidelines to the field emphasizing ICE’s focus on hazardous criminal aliens and employers who knowingly promote illegal workplaces and exploit legal workers. It goes on to state: “According to ICE Assistant Secretary John Morton, ‘[w]e are increasing criminal and civil enforcement of immigration-related employment laws and imposing smart, tough employer sanctions to even the playing field for employers who play by the rules.’ As part of this plan, ICE identified I-9 audits as an important administrative tool to build criminal cases, issuing civil penalties such as fines and bringing employers into compliance with the law.”