In July 2009, ICE launched an aggressive Notice of Inspection campaign. Approximately 700 companies have been served with Notices that demand submission of Forms I-9 relating to all employees terminated within the past six months to a year, as well as all existing employees. The meatpacking, restaurant, hotel and service industries received the bulk of the Notices, which are continuing to be served.

Don’t look for a slowdown anytime soon, either. John Morton, the new chief of ICE, which is a branch of the Department of Homeland Security, has told reporters that the agency will audit companies more frequently and will impose fines and even criminal charges on violators.

“You are going to see more audits regularly and on a larger scale,” said Morton.

In early August 2009, Houston-based Shipley Do-Nut Flour and Supply Company Inc. was sentenced to be under court supervision for three years, paid a criminal fine of $250,000 and forfeited $1.334 million for harboring unauthorized workers. Meanwhile, two corporate directors of Yamato Engine Specialists in Bellingham, Wash., pled guilty to aiding and abetting the use of false statements on Forms I-9; 28 unauthorized workers were found to be working for that company. And in July 2009, Krispy Kreme Doughnut Corp. was fined $40,000 for Form I-9 violations at one of its stores in Ohio.

What can you expect if you are served with a Notice of Inspection?

Generally, you should expect to be required to submit all Forms I-9 within three to 10 business days to the nearest ICE office with jurisdiction over your location.

ICE will then review each Form I-9 to determine:

• Technical compliance

ICE will focus on the preparer section and consistent dates, as well as documentation. If errors are found, ICE will return some of the Forms I-9 to you, demanding that each error be corrected and the forms sent back to them within 10 business days, to mitigate potential fines. However, they also will notify you that they may not have sent back all of the Forms I-9 with errors, suggesting there may be substantive violations that will be pursued independently. Although it is too early to project the formula and process for fines, be aware that recent Notices of Fines have been substantial and punitive. It’s also unknown whether corrections you make after receiving the Notice of Inspection will be accepted as compliant. ICE’s current position is that all errors made before you were served with the Notice of Inspection are subject to fines. But there is some indication this position is being reviewed internally; regardless, it will likely be challenged and modified in the future.

• Indications of identity fraud

ICE will determine the consistency and accuracy of the information contained in Sections 1 and 2. If they find that an employee is not authorized to work, you will be served a notice to terminate the employee within 10 days. If there are indicators of identity fraud, you will be served with a Notice of Discrepancies demanding that authorization to work issues be resolved by you (normally within 10 days), with a written notification to ICE documenting the resolution. Any case not resolved to ICE’s satisfaction will result in their intervention, most likely at the place of employment. Past experience suggests that ICE will identify most — if not all — workers falsely claiming to be permanent residents, and the majority of workers falsely claiming to be citizens of the United States.

• Misconduct

ICE will see if there are any patterns of identity fraud that may indicate an organized document/identity fraud operation. Their interest will be to identify the principals and facilitators. Any indication of facilitation within the company by employees or managers will result in a criminal investigation targeting the employer. They will also look for evidence of “knowing employment” that may relate to documents and/or identities presented by unauthorized workers that ICE believes should have reasonably been detected in the hiring process. Again, indicators of “knowing hires” will likely result in a criminal investigation.

What to expect heading into 2010

ICE will continue to serve Notices of Inspection on employers until the economy recovers and immigration reform takes place. The government needs to establish public confidence that it can protect American jobs for authorized workers, in order to respond to growing tensions over unemployment and before comprehensive reform can be passed.

The results of Notices of Inspection served will influence subsequent Notices. Where there are trends and patterns of compliance by employers, regions and/or industries, ICE will refine its targeting strategy accordingly. In some instances where deficiencies were discovered at one corporate location, for example, subsequent notices were served at other locations of the same corporation.

Unlike with raids, ICE will likely pursue sustained engagements with employers who have significant compliance and/or unauthorized worker problems. Subsequent Notices are likely to be served on an employer until ICE is satisfied and can document that its tactic has effectively corrected deficiencies and barred employment to unauthorized workers through the employer’s efforts to improve hiring practices.

Key subcontractors of target industries will likely receive Notices of Inspection as well. Their unauthorized workers will be terminated when discovered, and any “knowing’” relationships between the contractor and subcontractor relating to those unauthorized workers will be explored. In other words, if you depend on a subcontractor who depends on unauthorized workers, you may encounter problems with service as well as suspicion of misconduct.