With the new incoming administration, we are likely to see heightened enforcement in the area of I-9 compliance. Preparation is essential for employers to ensure employment eligibility of their workforce and safeguard against costly penalties.

Form I-9 compliance is critical for verifying the identity and employment authorization of all hired workers. Further, certain situations require employers to reverify work authorization, possibly many times throughout an employee’s career with the company. This process helps ensure that employers do not hire or retain unauthorized workers. Mistakes can quickly escalate into significant civil fines if a company is audited by U.S. Immigration and Customs Enforcement (ICE). Employers should act proactively to review their policies, correct errors, and implement internal systems to meet I-9 regulations.

In 2024, the Department of Homeland Security (DHS) released increased fines for form I-9 penalties to account for annual inflation. The new fines became effective for penalties assessed after June 28, 2024 for associated violations which occurred after November 02, 2015. The updated fines are as follows: 

Substantive/Uncorrected Technical Paperwork Violations:

• Minimum fine per violationfor substantive paperwork or uncorrected technical violations: $281
• Maximum fine per violation for substantive paperwork or uncorrected technical violations: $2,789

Knowingly Hiring/Continuing to Employ Unauthorized Workers:

• First offense fines: $698-$5,579 
• Second offense fines: $5,579-$13,946 
• Third or subsequent offense fines: $8,369-$27,894  

Overview of the I-9 Inspection (audit) Process

ICE initiates the audit process by issuing a Notice of Inspection (NOI), which gives employers three business days to provide Forms I-9 for all employees. The inspection aims to uncover any violations that could lead to criminal charges against the employer or administrative penalties for substantive or technical noncompliance.

The NOI typically requires employers to submit I-9 forms for both current and former employees, along with payroll records from the past three years, a list of current employees, and other corporate documents such as Articles of Incorporation and business licenses.

Substantive violations are finable offenses. However, if technical violations are identified during the review, ICE issues a “Notice of Technical or Procedural Failures,” highlighting the errors on the I-9 forms. Employers are then granted 10 business days to correct these issues. If employers fail to correct the technical violations they will be upgraded to substantive violations and subject to applicable fines.

When violations warrant penalties, ICE serves a Notice of Intent to Fine (NIF) along with charging documents outlining the violations and associated fines for substantive violations and any uncorrected technical violations. Additional penalties are imposed if the employer is found to have knowingly hired or continued to employ unauthorized workers.

Understanding How Fines are Calculated

To assess fines, ICE will divide the number of violations by the number of employees for which a Form I-9 should have been prepared to obtain a violation percentage. This percentage provides a base fine amount depending on whether this is a first offense, second offense, or a third or more offense. For example, regarding substantive and uncorrected technical violations, if an employer should have 100 perfect Forms I-9, but ICE identifies errors on 70 of them, the substantive error rate will be 70%. The same calculation is made to determine the error rate for knowingly hiring/continuing to employ unauthorized worker violations. Once the error rate is calculated, ICE refers to a graduated scale for the fine amount – the higher the violation percentage, the higher the fine per I-9 (up to the maximum amount listed per I-9 above).

If applicable, ICE will then add the amount derived from “knowingly hiring/continuing to employ unauthorized workers” to the amount derived from the substantive/uncorrected technical violations schedule.

Additionally, once the base violation is determined, ICE can then raise or lower the fine amount by 25% based on five factors:

• Size of the business;
• Good faith attempt to comply;
• Seriousness of the violations;
• Whether any unauthorized workers were found; and
• History of compliance.

Each of these five factors can cause the base fine level to be adjusted up or down by 5% for each factor or 25% total.

ICE has shown leniency toward employers who proactively address unintentional errors and implement enhanced I-9 policies and procedures before receiving a Notice of Inspection (NOI). As a result, employers are strongly encouraged to conduct regular internal audits to ensure they are prepared in the event ICE issues an NOI.

How Reddy Neumann Brown Can Assist

Conducting an internal Form I-9 audit requires careful planning and adherence to legal guidelines. Employers must determine the scope of the audit, such as whether to review all I-9 forms or a representative sample. Sampling must follow neutral and non-discriminatory criteria, and any discovered deficiencies should be addressed consistently. Reddy Neumann Brown PC offers comprehensive support to employers navigating these complexities, including:

• A thorough review or sampling of I-9 forms to identify technical, procedural, and substantive errors.
• Expert guidance on lawful correction of errors on Form I-9.
• Assessment of the company’s I-9 and E-Verify processes, including hiring practices.
• Recommendations for HR training to ensure compliance with I-9 and E-Verify requirements.
• Evaluation of record retention and storage policies for alignment with federal regulations.
• Insights into the advantages and disadvantages of E-Verify enrollment.
• Representation during ICE audits (Notice of Inspection).

With tailored solutions, Reddy Neumann Brown PC ensures employers can confidently address I-9 compliance challenges. If you have any questions, please schedule a consultation.

By: Krystal Alanis

Krystal Alanis is a Partner at Reddy Neumann Brown PC with over 10 years of experience practicing U.S. business immigration law. Krystal manages the firm’s PERM Labor Certification Department, where she oversees all EB-2 and EB-3 employment-based green card matters. Krystal guides clients from a variety of industries through the maze of the PERM Labor certification process and has handled thousands of PERM applications throughout her career. Krystal guides employers through the I-140 and Adjustment of Status process, and assists clients with temporary work visas. Further, she oversees the firm’s I-9 compliance team where she advises employers regarding Form I-9 Employment Eligibility Verification requirements and conducts internal audits of a company’s I-9 records, processes, and procedures. Additionally, Krystal represents clients in Form I-9 U.S. Immigration and Customs Enforcement (ICE) inspections (Notice of Inspection). Krystal successfully settled a claim with ICE over Form I-9 substantive paperwork violations that led to an 88% reduction in civil fines for her client.