The latest on E-Verify

If you are not in the loop on the current status of E-Verify, don't feel alone. This 13-year-old concept is still being born.

E-Verify is a free (I mean, if you don't count your tax dollars) system for verifying employment eligibility for newly hired employees through the federal government. It is a web-based partnership between the Department of Homeland Security and the Social Security Administration, and the U.S. Citizenship and Immigration Services (USCIS) oversees the program. It is a “re-branding” of its predecessor, the Basic Pilot/Employment Eligibility Verification Program, which has been in existence since 1997.

E-Verify allows employers to go to a Web site to electronically compare the information provided by the employee on an I-9 form against the U.S. Government database, and will tell the employer “within seconds,” according to the E-Verify Web site, if any discrepancies have been found. As of May 2008, it includes naturalization data to help confirm citizenship status of naturalized citizens.

According to USCIS, the use of E-Verify will virtually eliminate Social Security mismatches. USCIS makes E-Verify available to any employer, and according to DHS, about 1,000 employers sign up for E-Verify each week, and the program now has a total of 154,000 employers signed on.

The real controversy over E-Verify came when the government issued a Federal Acquisition Regulation last year that required federal contractors and subcontractors to use E-Verify not only to verify eligibility of potential new hires, but to also verify eligibility of existing personnel assigned to federal projects. It would apply to most federal contracts over $100,000 and subcontracts over $3,000. It would also cover businesses that receive American Recovery and Reinvestment Act funds.

Opponents claim that because it's difficult to distinguish who is working on a particular contract and who is not, for all practical purposes, contractors will have to verify their entire workforce, which is a very expensive proposition. The administration counters this claim with, “It's free,” using I-9 data that employers already have on hand.

In December 2008, the U.S. Chamber of Commerce and a coalition of business groups, the Society for Human Resource Management, the Associated Builders and Contractors, the HR Policy Association, and the American Council on International Personnel, filed suit in federal court in Maryland to block the rule from taking effect. The lawsuit seeks to avoid making use of E-Verify mandatory, arguing that this was the intent of Congress and cannot be circumvented by executive order. The plaintiffs complain that E-Verify risks invasion of privacy, the computerized program is inadequate for the job, the process of using it is lengthy and difficult, and there is an unacceptable danger of false positives due to identity theft and errors. The judge initially imposed a stay, preventing enforcement of the program.

As a result of these and other objections to E-Verify, the Obama administration has delayed implementation of the system, repeatedly: First by delaying it until February 20, then delaying it until May 21, then, after that, it was delayed until June 30, and most recently to September 8 — the day after Labor Day. The purpose of the postponements was to allow the new administration to re-evaluate this concept, which was first advanced during the Clinton Administration and formalized in Executive Order 12989 as amended by President George W. Bush on June 6, 2008. Homeland Security Secretary Janet Napolitano announced that the government intends to push ahead with its planned implementation of the rule on September 8.

It is not all that often that the general public gets to see the Separation of Powers clause of the U.S. Constitution actually play out, but this appears to be one of those times.

The judge in the Maryland federal lawsuit lifted the stay against implementation of the program on July 13, which led to the DHS announcement of the September date for mandatory use on all new federal contracts. The federal judge scheduled a hearing on August 28, and advised the parties to the lawsuit that he intends to rule prior to the September 8 deadline.

Aside from this legal challenge, the E-Verify Federal Contractor Rule could also be impacted by the Department of Homeland Security 2010 appropriations bill, H.R. 2892, which was passed by the Senate mid-August. An amendment inserted by Alabama Senator Jeff Sessions mandates that all federal agencies require contractors to use E-Verify as a condition of doing any business with the government. Unlike the current Federal Acquisition Regulation, the appropriations bill does not include any exemptions or conditions ($100,000 value, etc.), so presumably it could apply to all contractors, regardless of the contract size, type or duration.

The bill now heads to a joint conference where leaders will attempt to reconcile differences between the House and Senate versions of the bill. If these E-Verify provisions remain, it's possible that the E-Verify Federal Contractor Rule would need to be revised or revoked in favor of new regulations.

Update as of press time: The federal court in Maryland, on August 26, upheld the government's position in Chamber of Commerce of the United States v. Napolitano. Judge Alexander Williams Jr., rejected all of the arguments made by business groups, including arguments that the rule violated the Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA). Under IIRIRA, no person or entity may be required to participate in a pilot program such as E-Verify. The business groups involved in the lawsuit were disappointed by the ruling, but Rep. Lamar Smith (R-Texas) said that the court's decision will protect U.S. workers.

Susan McGreevy is a partner at Stinson, Morrison, Hecker LLP, Kansas City, Mo., 816/842-4800, e-mail to [email protected].