By law, federal contractors will have to start using the U.S. government's controversial electronic employment verification system in mid-January. But the Society for Human Resource Management (SHRM) and four other organizations have filed suit in federal court in an attempt to spare employers from what they believe is a flawed system.
Starting Jan. 14, most federal contractors and subcontractors will be required to use E-Verify. Under current law, use of the system is voluntary for all employers, including federal contractors and subcontractors. But if the new regulation goes into effect, the law will require federal contractors to verify the employment eligibility of new and existing employees.
E-Verify is an Internet-based system that allows employers to electronically check whether new hires are authorized to work in the United States. The system is operated by the Social Security Administration, and the United States Citizenship and Immigration Services of the Department of Homeland Security. Originally known as the Basic Pilot Program, the system was created by Congress as part of immigration reform in 1996.
But SHRM and the four other organizations that filed suit on Dec. 23 in U.S. District Court in Maryland argue that use of the E-Verify system should not be federally mandated—employers should be able to continue using it on a voluntary basis. The U.S. Chamber of Commerce, the HR Policy Association, the American Council on International Personnel, and the Associated Builders and Contractors also joined the suit.
Critics say the E-Verify system has a high error rate and that employers should not be required to use what they believe is an unreliable system. In fact, E-Verify has an error rate of 41 percent, according to a Social Security Administration report. Others also question the Bush administration's authority to mandate federal contractors' use of the system.
Congress already has chosen to extend the program to run on a voluntary basis three times, and SHRM believes that trend should continue, said Michael P. Aitken, director of governmental affairs for SHRM. So the hope is that the court will rule prior to Jan. 14 and provide injunctive relief.
“We don't think it's ready to be rolled out,” he said. “And we don't think this is the right approach to create an employment verification system. It's not ready to be mandated for employers.”
Until federal contractors hear otherwise, though, “the advice is to continue to obey the law.” The law applies to federal contractors who have contracts worth more than $100,000. And while no one knows how much the mandate will cost federal contractors, it is estimated that the new regulation will directly impact 150,000 to 200,000 organizations, Aitken said.
And it is expected that the law will create a number of problems for federal contractors, he said.
For one, the ruling requires federal contractors to reverify the employment eligibility of their existing workforce—a time-consuming proposition for large federal contractors, Aitken said. According to some who have chosen to voluntarily participate in E-Verify, it has taken up to 18 months to get up and running under the system.
The law also will present other administrative challenges to employers. According to the new guidelines, federal contractors also will be required to ensure that all of their subcontractors are using E-Verify. But SHRM's position is that federal contractors should only be responsible for keeping their own organizations in compliance, Aitken said.
SHRM is not opposed to the idea of an electronic verification system per se, he said. But such a system should be reliable. And until the glitches are ironed out, its use should not be federally mandated for employers.
There have been instances where employees who are eligible to work in the United States are deemed ineligible by the E-Verify system, Aitken said. For example, a recently married woman might not appear eligible in the system because her Social Security number is still tied to her maiden name.
In recent months, there also have been numerous incidents of identity theft that have been associated with the E-Verify system, he said. In these instances, people have obtained false identification using someone else's information, which then has been entered into the E-Verify system.
The problem, Aitken said, is that E-Verify cannot detect many forms of document fraud or identity theft because it is unable to verify the identity of the person presenting the documents. It can only match information presented on documents provided by an individual with records in the system.
“I definitely think that the electronic verification system is coming,” Aitken said. But hopefully the problems will be corrected before federal contractors and other employers are required to use it.
Written by Jenny Cromie, certified human resources specialist (CHRS)
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