Hi Employer!  Here is an alarm for you to take very seriously. My compliance concern for you was heightened based on an email reply I received concerning affiliate companies that “It sounds like the other companies are already working with other software”, dovetailing with a DHS warning that a Denver attorney sent over to me a couple of weeks ago.

It is an extremely complex issue, but it has, possibly, extremely negative and potentially massive federal financial (and reputational) liabilities for any employers who might be in the same boat regarding their electronic I-9 systems and the HRIS or Payroll or background screening vendors who provide that I-9 system. I will attempt to lay all of this out in the most concise and understandable way that I can. 

1) My experience in the electronic I-9 world dates back to 2004, when I began working with the inventor of the first ever electronic I-9 system. Walmart & Home Depot were two of our early clients. A few years later, I was brought aboard to consult with some of the new entrants in the field.

2) Electronic I-9 systems, and electronic I-9 signatures, are subject to certain federal laws, and federal rules, specific to Electronic I-9s https://www.ecfr.gov/current/title-8/chapter-I/subchapter-B/part-274a#p-274a.2(e)   also the following paragraphs (f), (g), (h), and (i).  Also, this is kind of a summary of the important points in the CFR sections https://www.uscis.gov/i-9-central/form-i-9-resources/handbook-for-employers-m-274/100-retaining-form-i-9/101-form-i-9-and-storage-systems

3) IF a company is using an electronic I-9 system that is NOT compliant with the full slate of fed regs governing electronic I-9 systems, in the case of a DOJ/DHS/USCIS/ICE Form I-9 worksite audit, the federal auditors can, and in many past cases have, deemed the employer to have NO FORMS I-9 at all (within that system), and levied fines and penalties on that basis, currently nearly $ 3,000 per I-9 “missing”, and up to nearly $ 3,000 per for “paperwork violations” (errors, missing fields, etc) on any paper Forms I-9 inspected by the feds. In this scenario, IF a company is audited by feds, and unless they have mitigated that situation of potentially YEARS of I-9s processed through a non-compliant system, that company’s situation is far more dire than even a carelessly completed & retained box or file cabinet of paper Forms I-9.

4) Last December, Dept of Justice (DOJ) issued a very alarming notice regarding the importance of using a compliant electronic I-9 system. In all my 20 years of doing this, I had never seen anything like it, as a shot across the bow that I-9 audits are coming back, post COVID, and that they are serious about the electronic I-9 system issue. https://www.justice.gov/d9/2023-12/joint_form_i-9_software_guidance_12_19_23.pdf

5) A couple of weeks ago, I was made privy to some Federal enforcement plans, by an attorney friend. He sent me this (among other things) : “I have summarized a series of recent discussions with DHS…As one senior agent put it, “We are tired of employers hiding behind noncompliant electronic I-9 vendors.  As part of our effort to break the employment magnet, we intend to engage in a dramatic increase in I-9 audits and to focus, in particular, on electronic I-9s, particularly the audit trails, the affirmative acknowledgement of the attestations, and other frequent areas of noncompliance.””

6) Additionally, from another attorney friend, I learned of a large employer currently being “adjudicated” by the feds regarding their Form I-9 compliance, who have requested that their I-9 vendor, a payroll processor, be added to the case as a defendant, and be subpoenaed as such.

7) In my own researches on behalf of clients, I have discovered that (a) a client’s HRIS vendor’s I-9 product is NOT compliant, leaving aside all the other issues in CFR 274, as it advertises, on its website, that it pre-populates Form I-9 Section 1 data from the HRIS onboarding data, which is a complete no-no where the fed regs are concerned, and that (b) another client, using a background screen vendor’s Form I-9 product is NOT compliant, as on its website it bills its touch pd signature feature as a “wet” signature, which it is NOT, and by being actually an e-sig, it makes the I-9 an electronic I-9, and that system does not conform to the therefore required features of an electronic I-9 system, per fed regs.

8) We know, beyond a shadow of a doubt, that fillable I-9 pdfs, using Docusign or any other pdf signature method other than print and sign in pen, are by definition electronic I-9s, and therefore subject to the fed regs governing, and, therefore, NOT compliant, unless, through some strange twist an I-9 vendor incorporates the fillable pdf into its overarching Electronic I-9 system.

9) There are only 4 or 5 stand-alone I-9 products that I can fully vouch for, and in addition there might be HRIS/Payroll/Background Screen vendors reselling or having integrated those compliant systems.

10) What should Employers, using anything other than Paper Forms I-9 with pen & ink signatures, do IMMEDIATELY? Make sure the I-9 system being used meets the federal requirements. That would mean becoming extremely familiar with the rules, laws and regs in the links above, and demanding answers from your I-9 vendors – compliance white papers, etc. IF you have a solid legal team internal or outside get with them, providing them the info in this warning, or get with me, to look into it further, or, IF your system is deemed non-compliant, to begin mitigation ASAP. 

Kind Regards,
David Adams, Form I-9 Compliance

david@safesthires.com

P:‪325.238.5866

visit us at https://www.safesthires.com/