Sep 24, 2007

No-Match Letters a No-Go: Hearing Coming Up on New Regulations

Employers have long been confused about what, exactly, they are supposed to do when they receive a "no-match" letter: a letter from the Social Security Administration stating that the Social Security number reported for an employee (usually on IRS Form W-2) does not match the government's records. Although a no-match letter might mean that the employee's work authorization documents - which the employee must present as part of the I-9 process -- are inaccurate or even falsified, it could be issued for other reasons too, such as typos or errors in the government database. What's more, employers are told that they must accept documents that "reasonably appear to be genuine"; asking for more or different documentation could be illegal discrimination on the basis of national origin or citizenship status.

The Department of Homeland Security (DHS) issued new regulations to explain what employers should do if they receive a no-match letter. Although employers aren't legally required to follow these rules, those who do can take advantage of a safe harbor provision, which protects them from legal liability if an employee turns out not to have proper work authorization. These rules were scheduled to go into effect on September 14, 2007, but they didn't. A federal judge in San Francisco issued a temporary restraining order prohibiting DHS from enforcing the rules and even from sending out packets to employers explaining what will be required. The judge found that the plaintiffs who filed the lawsuit challenging the rules - including the AFL-CIO and the ACLU - had raised serious questions as to whether the new rules are legal or exceed the authority of the DHS and the Social Security Administration.

On October 1, the court will hear arguments as to whether it should issue a preliminary injunction, extending the prohibition on enforcing the rule. The plaintiffs have filed their papers, as has the DHS; now it's up to the judge to decide what will happen next.

Lisa Guerin