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Obama Administration to Begin E-Verify Enforcement For Certain Federal Contractors on September 8, 2009

July 20, 2009

The Obama administration has completed its evaluation of the E-Verify rule and will begin enforcing compliance with the rule on September 8, 2009. As a result, federal contractors and subcontractors will be required to use the federal government's E-Verify system to verify the employment eligibility of all new hires in the U.S. and all employees working in the U.S. on federal contracts valued at $100,000 or higher, or "subcontracts" valued at greater than $3,000. However, the future of E-Verify and the obligations of contractors remain uncertain for two reasons: (1) litigation challenging the E-Verify rule, which had been stayed pending the administration's evaluation, may now move forward; and (2) the Senate has approved an amendment to the 2010 Homeland Security spending bill that would expand E-Verify to apply to all existing employees, and not just new hires or those employees working on federal contracts at the thresholds listed above.

The E-Verify system is an on-line system that prompts employers to enter information provided by an employee on his/her I-9 Form. The system is designed to provide, within three to five seconds, a verification that a match has been found in the Social Security Administration (SSA) or the Department of Homeland Security's (DHS's) databases or a notification that there was no match. E-Verify is run by the U.S. Citizenship and Immigration Services (USCIS) in partnership with SSA. Under the program, if there is no match, the employer receives a "nonconfirmation" notice and is required to provide the employee with a written notice of that fact. The employee is then required to indicate on the notice whether he or she wishes to contest the nonconfirmation and, if he or she wishes to contest, the employer issues a second notice to the employee and the employee has eight days to visit an SSA office or call the USCIS to resolve the discrepancy. If the employee contests the nonconfirmation, the employer is prohibited from terminating or taking other adverse action against the employee while the final resolution is pending. Employers must continue to comply with Form I-9 requirements as well.

For questions about implementation, administration and exemptions, please contact the professionals listed below, or your regular Crowell & Moring contact.

For more information, please contact the professional(s) listed below, or your regular Crowell & Moring contact.

Kris D. Meade
Partner – Washington, D.C.
Phone: +1.202.624.2854
Ira M. Saxe
Partner – New York
Phone: +1.212.895.4230