RESUMPTION OF SOCIAL SECURITY NO-MATCH LETTERS AND CONSTRUCTIVE KNOWLEDGE

By Cyrus D. Mehta

On April 6, 2011, The Commissioner of the Social Security Administration announced that SSA would resume sending “no-match” letters, https://secure.ssa.gov/apps10/public/reference.nsf/links/04052011011437PM. Two I-9 compliance mavens, John Fay, http://www.electronici9.com/enforcement/the-return-of-the-social-security-no-match-letter/ and Kevin Lashus, http://www.immigrationcomplianceblog.com/ice/social-security-administration-resumes-sending-no-match-letters/, have adequately commented on this new development, and I will not go into the technicalities of the specifics of such a letter. This post analyzes whether an employer who receives such a letter from the SSA – indicating that its employee’s number does not correspond with an account at the agency - has constructive knowledge that he or she is employing an unauthorized worker in violation of the law.

While INA §274A(a)(1)(A) clearly makes it unlawful to hire “an alien knowing (emphasis added) the alien is an unauthorized alien,” an employer cannot bury his or her head in the sand in the ground like an ostrich, and ignore telltale signs that the person may indeed not be authorized. The regulations at 8 C.F.R. §274a.1(l)(1) defining “knowing” includes “constructive knowledge” and defines the term as follows:

The term knowing includes not only actual knowledge but also knowledge which may fairly be inferred through notice of certain facts and circumstances which would lead a person, through the exercise of reasonable care, to know about a certain condition. Constructive knowledge may include, but is not limited to, situations where an employer:

(i) Fails to complete or improperly completes the Employment Eligibility Verification Form, I-9;

(ii) Has information available to it that would indicate that the alien is not authorized to work, such as Labor Certification and/or an Application for Prospective Employer; or

(iii) Acts with reckless and wanton disregard for the legal consequences of permitting another individual to introduce an unauthorized alien into its work force or to act on its behalf.

2) Knowledge that an employee is unauthorized may not be inferred from an employee's foreign appearance or accent. Nothing in this definition should be interpreted as permitting an employer to request more or different documents than are required under section 274(b) of the Act or to refuse to honor documents tendered that on their face reasonably appear to be genuine and to relate to the individual.

Yet, not all courts or administrative tribunals have found that an employer had knowledge that an alien was unauthorized to work in the US. In Collins Food International, Inc. v. INS, 948 F.2d 549 (9^th Cir. 1991), a seminal case involving the application of constructive knowledge, an employer was sanctioned for knowingly hiring an alien as he made a job offer prior to checking the alien’s documents and because the employer did not verify the back of the social security card. The Ninth Circuit rejected the government’s charges under both the factual circumstances. First, there was nothing in the law or regulations that required an employer to verify documents at the time of the job offer and prior to the hire of the alien. In fact, pre-employment questioning concerning the prospective employee’s national origin, race or citizenship would expose the employer to charges of discrimination under Title Seven. Regarding the employer’s failure to properly verify the back of the social security card, the Ninth Circuit held that under INA §274A(b)(1)(A) an employer will have satisfied its verification obligation by examining a document which “reasonably appears on its face to be genuine.” There was also nothing in the statute that required the employer to compare the employee’s social security card with the example in the handbook of the Immigration and Naturalization Service, and the “card that Rodriguez presented was not so different from the example that it necessarily would have alerted a reasonable person to its falsity.” Finally, the Ninth Circuit was concerned that if the doctrine of constructive knowledge was applied so broadly, the employer may be tempted to avoid hiring anyone with appearance of alienage to avoid liability.

Similarly, even if 8 C.F.R. §274a.1(c)(1)(iii)(A) attributes an employer with constructive knowledge if the employee requests sponsorship through a labor certification, it should not be automatically assumed that the individual is not authorized to work in the US. Such an employee could possess a valid employment authorization as one who has been granted withholding of removal or temporary protected status, which without a sponsorship through the employer, may not provide him or her with any opportunity to obtain permanent residence.

The facts in Collins Food International ought to be contrasted with situations where an employer has been notified by the government after a visit to its premises that certain employees are suspected to be unlawful aliens and is asked to take corrective action. Thus, in US v. El Rey Sausage, 1 OCAHO no. 66 1989, aff’d, 925 F.2d 1153 (9^th Cir. 1991), where the INS found several employees using improper or borrowed alien registration numbers, and the INS warned in a letter that unless these individuals provide valid employment authorization they will be considered unauthorized aliens, and the employer simply accepted the word of the aliens as to their legal status, the Ninth Circuit found constructive knowledge. Therefore, it is one thing when an employee who is untrained accepts a false document, as in Collins Food International, and quite another when an employer receives notice from ICE that certain employees may not have proper work authorization.

With regards to a social security “no-match” letter, the issue of whether the employer is deemed to have constructive knowledge continues to remain fuzzy. The employer's receipt of a no-match letter does not fall squarely within the facts of Collins Food International, yet such a letter still does not constitute a direct indication, as in US v. El Ray Sausage, that the worker is unauthorized. The DHS promulgated a rule in 2007 that would have imputed constructive knowledge to an employer who received either a “no-match” letter from the Social Security Administration (SSA) or a DHS notice. 72 Fed. Reg. 45611 (August 15, 2007). The rule would have provided a safe harbor to an employer if it took the following steps to remedy the no-match within 90 days. The employer first checks its own records to determine whether there is a typographical error or similar clerical error. If it’s not the employer’s error, the employer asks the employee to confirm the information. If the employee says that the information is incorrect, the employer must correct its records and send the correct information to the SSA. If the employee insists that the information he or she gave to the employer is correct, the employer must request the employee to resolve the discrepancy with the SSA. If the employer is unable to verify with the SSA that the erroneous information has been corrected within 90 days, the employer must allow the employee to present new verification documents without relying on the documents that created the mismatch. The regulation was stayed as a result of a challenge in federal court, and the rule was finally rescinded.

In light of the vacuum resulting in the rescinding of this regulation, what guidance can employers rely on? Paul Virtue, former General Counsel of the INS, issued a letter stating that a no-match letter from the SSA did not, standing on its own, provide notice to the employer that the employee is not working without authorization in the US. Letter, Virtue, General Counsel, INS HQCOU 90/10.15-C (Apr. 12, 1999), available on AILA InfoNet at Doc. No. 01061431 (posted on June 14, 2001). However, in the same letter, Mr. Virtue stated that a subsequent action or inaction by the employer, after receipt of such a letter, would be viewed under the “totality of circumstances” in determining whether the employer possessed constructive knowledge of whether the employee was authorized or not in the US. Notwithstanding, employers must not be too hasty in terminating employees if they receive no match letters.

A recent decision on the precise issue of no-match letters, Aramark Facility Services v. Service Employees International, 530 F.3d 817 (9^th Cir. 2008), sheds more clarity on whether the employer has constructive knowledge. There, the employer upon receiving no-match letters from the SSA gave its affected employees three days from the post mark of its letter to either get a new social security card or a receipt from the SSA that it has obtained a new one, and if the employee produced a receipt, the employee had 90 days to submit the new card. Those employees who could not comply with this demand were fired, but were told that they could be rehired if they obtained the correct document. Moreover, the employer did not have any specific basis to believe that the employees who were the subject of the no match letters were not authorized to work, and each of these employees had properly complied with the I-9 verification requirements at the time of their hire. The Ninth Circuit had to decide whether to set aside an arbitrator’s award under a narrow exception that the award violated public policy in ordering back pay and reinstatement as the firings were without cause. Aramark’s main argument under the public policy exception was that if it continued to employ these workers it would be sanctioned for knowing that they were not authorized to work in the US. The Ninth Circuit disagreed with the district court’s decision setting aside the arbitrator’s award and held that the mere receipt of no-match letters from the SSA without more did not put Aramark on constructive notice, and forcefully stated that by its own admission the SSA has acknowledged that “17.8 million of the 430 million entries in its database (called “NUMIDENT”) contain errors, including about 3.3 million entries that mis-classify foreign-born U.S.citizens as aliens.” The Ninth Circuit, which relied on Collins Food International, further noted that employers do not face any penalty from SSA, which lacks an enforcement arm, for ignoring a no-match letter. Furthermore, the Ninth Circuit also gave short shrift to Aramark’s second argument that the employee’s reaction to the notification to take corrective action imputed constructive knowledge on the ground that the arbitrator found no proof of any employee having undocumented status as well as to the fact that the employer’s demand to take corrective action was even more demanding than the DHS’s proposed 2007 regulations. Finally, the Ninth Circuit refused to upset the arbitrator’s award in failing to consider that Aramark had offered to rehire the workers if they came back with the corrected document even after the time frame that it had stipulated in its notification to its employees.

The Department of Justice's Office of Special Counsel for Immigration-Related Unfair Employment Practices recently issued the following do's and don'ts for employers on Social Security Number "no-match" letters, http://www.justice.gov/crt/about/osc/htm/SSA.php, which provide useful nuggets on what one can do and one cannot do when an employer receives a no-match letter.

DO:

•Recognize that name/SSN no-matches can result because of simple administrative errors.

•Check the reported no-match information against your personnel records.

•Inform the employee of the no-match notice.

•Ask the employee to confirm his/her name/SSN reflected in your personnel records.

•Advise the employee to contact the SSA to correct and/or update his or her SSA records.

•Give the employee a reasonable period of time to address a reported no-match with the local SSA office.

•Follow the same procedures for all employees regardless of citizenship status or national origin.

•Periodically meet with or otherwise contact the employee to learn and document the status of the employee's efforts to address and resolve the no-match.

•Submit any employer or employee corrections to the SSA.

DON'T:

•Assume the no-match conveys information regarding the employee's immigration status or actual work authority.

•Use the receipt of a no-match notice alone as a basis to terminate, suspend or take other adverse action against the employee.

•Attempt to immediately re-verify the employee's employment eligibility by requesting the completion of a new Form I-9 based solely on the no-match notice.

•Follow different procedures for different classes of employees based on national origin or citizenship status.

•Require the employee to produce specific documents to address the no-match.

•Ask the employee to provide a written report of SSA verification.

In conclusion, an employer walks on thin ice upon receiving an SSA no-match letter, and is also caught within the cross currents of the conflicting policies of two agencies. While ICE may require an employer to take action upon receiving a "no match" letter, leading to the employee's termination, the DOJ's Office for Special Counsel may find that the employer has engaged in discriminatory practices. It is thus incumbent upon an employer in such a situation to consult with experienced immigration counsel to safely navigate through such murky waters by designing employer policies that would be consistently applied each time the employer receives a no-match letter.

Substantial portions in this blog post have been extracted from KEEPING TRACK: SELECT ISSUES IN EMPLOYER SANCTIONS AND IMMIGRATION COMPLIANCE by Gary Endelman and Cyrus D. Mehta, http://www.cyrusmehta.com/News.aspx?SubIdx=ocyrus20101218204951#_ftn27

VICTORY IN EL BADRAWI v. USA: NARROWING THE DISCONNECT BETWEEN STATUS AND WORK AUTHORIZATION

By Cyrus D. Mehta

In El Badrawi v. USA, 07-cv-1074 (D. Conn. Dec. April 11, 2011), the United States District Court in Connecticut ruled that an H-1B worker who had timely sought an extension of that visa status, and who was authorized to continue working under 8 CFR § 274a.12(b)(20), could not be arrested or subjected to removal. Although a district court decision may not have precedential value beyond the plaintiff in the case, it is nevertheless extremely significant as it provides the stepping stone for other courts to also be similarly persuaded.

The Department of Homeland Security, and the former Immigration and Naturalization Service, have always taken the position that being authorized to work in the US is not the same thing as being in a lawful status. Moreover, the benefits granting agency within the DHS, the United States Citizenship and Immigration Services, has long drawn a distinction between maintaining lawful status and being lawfully present in the United States, See Unlawful Presence v. Out of Status, http://bit.ly/ahjXpj. For example, an applicant for adjustment of status, whose underlying nonimmigrant L or H status has expired, will not be considered unlawfully present for purposes of triggering the 3 and 10 year bars under INA § 212(a)(9)(B) but will still not be considered to be in lawful status even though this applicant is authorized to work. This unfortunate individual might even be amenable to removal as a deportable alien pursuant to INA §237(a)(1)(C), see USCIS Consolidated Guidance on Unlawful Presence, http://bit.ly/c9xHs9.

The holding in El Badrawi is narrow, and has been rendered in the context of a claim against the government for a false arrest of an employee while he was seeking an extension of his H-1B visa status. In dismissing the government’s motion for summary judgment, the court reaffirmed its prior holding in Badrawi v. DHS, 579 F. Supp. 2d 249 (D. Conn. 2008) (El Badrawi 1), http://www.bibdaily.com/pdfs/El%20Badrawi%209-22-08.pdf, where the plaintiff claimed he was falsely arrested while an extension to extend H-1B status filed by his employer, University of Connecticut, was pending. . The court in El Badrawi 1 found the government’s position “bewildering” that the plaintiff was entitled to work in the United States pursuant to 8 CFR § 274a.12(b)(20) but not entitled to be physically present in the United States. In its most recent holding, which we will refer to as El Badrawi II, the court came down more strongly in favor of the plaintiff. The court’s opinion revolves around the meaning of 8 CFR § 274a.12(b)(20), which the court aptly summarized as follows:

A nonimmigrant alien [who was admitted under one of various forms of work-based visas, including an H-1B visa] whose status has expired but who has filed a timely application for an extension of such stay….[is] authorized to continue employment with the same employer for a period not to exceed 240 days beginning on the date of the expiration of the authorized period of stay.

The government contended that this regulation only applied to an alien’s authorization to work in the US but it did not extend to the alien’s authorization to remain in the US. The government also asserted that it always had the discretion to arrest, detain and remove such an alien. However, Judge Janet C. Hall, who wrote the opinion, gave short shrift to the government’s interpretation of this regulation. Although a government agency is entitled to its interpretation of its own regulation, such deference can be set aside if it is “plainly erroneous or inconsistent with the regulation.” Auer v. Robbins, 519 U.S. 452, 461 (1997). According to Judge Hall, “[t]he fact that section 274a.12(b) pertains solely to aliens whose immigration status is based and conditioned upon their need to work in the country strongly indicates that the two rights go together here. An extension of only the right to work, without the right to remain in the country, is at odds with the nature and purpose of the affected work-based visa programs.”

In the absence of any policy guidance from the government on this issue, Judge Hall also relied on a USCIS “Customer Guide” pamphlet, which clearly advised the public that if the application for an extension is received before one’s status has expired, “you may continue your previously approved activities in the United States (including previously authorized work) for a maximum period of 240 days.” This permission, according to Judge Hall, was not just limited to work but also to all “previously approved activities,” such as being present and temporarily residing in the US.

More significantly, the court also held that the government’s proposed interpretation raised “grave” due process concerns. The fact that the DHS could arrest a law abiding alien who was complying with the rules was tantamount to a deprivation of liberty without due process under the Fifth Amendment. Here, the plaintiff, a Lebanese national, was arrested and detained from October 29, 2004 until December 22, 2004, when he was escorted out of the country after receiving a voluntary departure order from an Immigration Judge. Moreover, here there was no pre-enforcement notice provided to the plaintiff, and if there was any notice through the USCIS Customer Guide, it “plainly supports and fosters the expectation that aliens in El Badrawi’s position may remain in the country while awaiting a determination on their timely filed extension applications.” Judge Hall also noted the amicus brief of the American Immigration Council and the American Immigration Lawyers, which “highlights the substantial interest that employers have in the administration of the H-1B visa program, the lack of notice provided by the regulation at issue, and the hardship that the government’s proposed interpretation would impose upon them.”

While El Badrawi II may only apply to the plaintiff and is also limited to the circumstances of one in H-1B visa status timely applying for an extension of his or her status through the same employer, it does not mean that other persons in similar unfortunate circumstances as Mr. El Badrawi cannot use the same arguments in other administrative or litigation forums. After all, 8 CFR §274a.12(b)(20) provides the same work authorization rights to other nonimmigrant visa holders who are seeking extensions of their L-1, O, and TN statuses, to name a few. Also, if a person files an I-485 application for adjustment of status to permanent residence, he or she is also entitled to work authorization under a different regulatory provision, 8 CFR § 274a.12(c)(9), and if work authorization has been applied for and granted, the regulation states that such an alien will not be deemed to be an “unauthorized alien.”

How about an H-1B worker who is seeking an extension of H-1B status through a new employer? While the regulatory provision, 8 CFR §274a.12(b)(2), no longer applies, this person can invoke the protection of something much stronger – the statute itself. INA § 214(n) permits such a person the ability to “port” to a new employer upon the filing by the prospective employer of a new H-1B petition. While the H-1B petition is pending, such a person can accept employment with the new employer who filed the H-1B petition. This person too if arrested, detained and placed in removal can make similar arguments, which is that INA § 214(n) authorizes him or her to work in the US during the pendency of the petition. Such a person may “port” even if there was a gap in H-1B status, and could make the claim that the ability remain employed in the US also allows him the right to remain here, see H-1B Portability When There Is A Gap In Status, http://www.cyrusmehta.com/News.aspx?SubIdx=ocyrus20108745832.

And why should the logic of El Badrawi I and II only hold when the affected alien is authorized to work under a regulatory or statutory provision? There are several situations where a person can legitimately extend or change status even if there is no authorization to work. Thus, a person in B-1 status can apply for an extension of that status. Or an F-1 student can apply for a change to H-1B status, or one who is previously in H-1B status may change to H-4 status because she may have a spouse in H-1B status and has taken a break in her work because she has just given birth to a baby. Why should a new mother who is legitimately changing status from H-1B to H-4 be susceptible to arrest, detention and removal just because there is no provision authorizing her to work in the US? Indeed, this mother is changing status to H-4 dependent precisely because she does not choose to work during this stage in her life, but the H-4 status will still enable her to lawfully reside in the US with her spouse and her child. Providing the government with unbridled discretion to arrest, detain and remove her while she has filed an application to change status would also gravely offend the Fifth Amendment’s Due Process Clause.

A forceful due process argument can be made that if there is an established statutory or regulatory procedure to change or extend status, the government should not be permitted to deprive the person of his or her liberty during this interim period when it would be unable to do so prior to the status expiring or after the new status has been granted. The court in El Badrawi II relied on Zadvydas v. Davis, 533 U.S. 678 (2001), which has held that “the Due Process Clause applies to all ‘persons’ within the United States, including aliens, whether their presence here is lawful, unlawful, temporary or permanent.” In Zadvydas v. Davis, the Supreme Court further held that indefinite detention is unconstitutional following a removal order beyond 6 months six months of detention because “Freedom from imprisonment – from government custody, detention, or other forms of physical restraint – lies at the heart of the liberty that Clause protects.” Also, take note of these powerful words from the Supreme Court in Bridges v. Wixon, 326 U.S. 135, 164 (1945), “The impact of deportation…is often as great if not greater than the imposition of a criminal sentence. A deported alien may lose his family, his friends and his livelihood forever. Return to his native land may result in poverty, persecution and even death.”

Finally, the INA never defines “status,” and it may be worth advocating for a unified definition of status. One needs to be in status to avoid removal, but also to apply for other benefits such as adjustment of status. In Bokhari v. Holder, 622 F.3d 357 (5^th Cir. 2010), which Judge Hall distinguished, the issue was whether a person who had applied for an extension of his L-1A status, triggering 8 CFR §274a.12(b)(2), would be eligible to file an I-485 adjustment of status application. Mr. Bokhari was not facing removal; rather he argued that he should have been considered to have been maintaining status in order for him to be eligible to file an I-485 application. The regulation in question in Bokhari v. Holder was 8 CFR § 245.1(d)(1)(ii), which seemed to preclude Mr. Bokhari from demonstrating that he was maintaining status. 8 CFR § 245.1(d)(1)(ii) defines “lawful immigration status” for purposes of I-485 eligibility as an alien “whose initial period of admission has not expired or whose nonimmigrant status has been extended in accordance with part 214 of 8 CFR chapter 1.” Hence, one whose status had not been extended, such as Mr. Bokhari’s, was not in lawful immigration status. In a prior blog post, The Enigma of Bokhari v. Holder: Work Authorization Is Not Status, http://cyrusmehta.blogspot.com/2010/10/enigma-of-bokhari-v-holder-work.html, Gary Endelman and this writer argue that 8 CFR § 245.1(d)(1)(ii) may be ultra vires the statute, INA §245(c), as it does not allow persons who are in the process of seeking an extension of their status to demonstrate that they are not in “unlawful immigration status.” Just as persons like Mr. El Badrawi should not fear arrest, detention and removal while they have applied for an extension of their H-1B status, so should they be able to demonstrate eligibility for filing an I-485 application for adjustment of status.

Such a unified theme can be left for another day, but at least for the present after the victory in El Badrawi II, it is heartening that the many thousands of H-1B visa holders who legitimately apply for extensions of their status have a good argument to make in the event of an arrest or being placed in removal proceedings.