September 19, 2023
Penalties for employment eligibility verification (Form I-9) violations have always posed a significant fiscal risk for employers. Previously, inflation rarely played a role in these issues. However, the Department of Justice’s Office of the Chief Administrative Hearing Officer (OCAHO) announced a decision inciting change.
The OCAHO Decision
The decision has posed the question of what date to use when assessing penalties for Form I-9 violations. Answering this question could signal a change from established practices. It would affect how the U.S. Immigration and Customs Enforcement (ICE) determines the date for assessing civil penalties, causing significantly higher penalties for prolonged cases.
Violating I-9 regulations can result in civil penalties. When enacted in 1986, the law limited the fines to a maximum of $1,000. However, the penalties have increased over time. The most notable increase occurred when the Bipartisan Budget Act of 2015 more than doubled it. The fluctuation is due to Civil Monetary Penalties and Inflation Adjustments.
The Department of Justice (DOJ) publishes the Adjustments annually, ensuring they follow the general inflation rate. This pace can result in significant changes in maximum fines between years during high inflation. Traditionally, this would have a minimal impact. The minor impact is because the OCAHO established a precedent that locked fines at specific times, depending on when ICE issued a Notice of Intent (NIF).
The Chief’s Thoughts
According to the Chief Administrative Hearing Officer, “As noted, since 2020, OCAHO decisions by both its ALJs and the CAHO have consistently asserted that the date of assessment for purposes of 28 C.F.R. § 85.5 in cases arising under 8 U.S.C. § 1324a10 is the date DHS serves the NIF on the respondent.”
In the decision to vacate a penalty assessment, the Chief raised several questions. In it, the Chief questioned whether the date that locked in the penalties should occur the day of the NIF’s announcement. He also debated whether it should happen when the OCAHO assesses the penalty. Though the former would prove more favorable, the analysis shows that the decision favors the latter.
The Results so Far
This result could lead to considerable penalties due to inflation. As such, the Officer vacated the Final Order on penalties. He also remanded the case for further proceedings to make a final decision. As a result, the question of when to assess penalties remains unanswered.
This decision may present a higher risk for employers facing penalties for Form I-9 violations; employers with prolonged cases will feel those risks more than others. As such, employers should continue to comply with all I-9 regulations to prevent such complications. Working with a background check provider capable of electronic I-9 and E-Verify integration systems is one means to ensure compliance.