As the federal government contemplates legislation to expand the mandatory use of E-Verify beyond the current requirements (which mandate certain federal contractors and subcontractors use E-Verify), many states have enacted or likely will enact their own laws requiring employers in their states to use E-Verify.

Previously known as Basic Pilot, E-Verify is an Internet-based system jointly operated by the US Department of Homeland Security (DHS) and the Social Security Administration (SSA). E-Verify requires that, in addition to completing Form I-9 to verify employment eligibility, the employer must electronically verify employment eligibility of newly hired employees through the E-Verify System. This is done using their names, Social Security numbers, and in some cases, photographs, taken from information provided on the Form I-9s. . Before using the system, an employer signs a Memorandum of Understanding with DHS and SSA, which contains the conditions and obligations of E-Verify. One of these conditions is that, if an employer receives a final nonconfirmation regarding the work authorization of an individual and continues to employ that individual, the employer is subject to a rebuttable presumption that it has knowingly employed an unauthorized alien in violation of section 274A(a)(1)(A) of the Immigration and Nationality Act.

Under federal law, E-Verify is only mandatory for certain federal contractors and their subcontractors. The federal contract will have the E-Verify Clause in it. The prime contractor is responsible for directing any subcontractors to use E-Verify. For federal contractors, E-Verify must be used on all new hires in the United States and on current employees assigned to the federal contract.

Although companies that are not federal contractors may voluntarily enroll in E-Verify, many states currently have E-Verify requirements, and it is expected that more states will implement such requirements. The terms of the Memorandum of Understanding for users that are not federal contractors provide for the use of E-Verify for new hires but not for current employees (even when re-verifying Form I-9 of current employees). The federal government is also contemplating legislation that would make E-Verify mandatory for all employers.

States that currently require E-Verify (or other designated programs for work authorization verification) for certain or all employers include: Alabama, Arizona, Colorado, Florida, Georgia, Louisiana, Minnesota, Mississippi, Missouri, Oklahoma, South Carolina, Tennessee, and Utah.

California has bucked the trend by enacting a state law providing that the state of California or any of its cities, counties, or special districts cannot require an employer to use E-Verify as a condition of receiving a government contract, applying for or maintaining a business license, or as a penalty for violating licensing or other similar laws. California employers are still free to use E-Verify on a voluntary basis or as required by federal contracts.

As each state’s law has its own criteria for when E-Verify must be used, please consult with counsel for details. Even if your state does not currently require you to use E-Verify, new state or federal legislation could change that in the near future.  

Should you have any questions regarding this Alert, please contact members of Arent Fox’s International Trade Group, or the Arent Fox attorney who handles your matters.