Back To The “Basics”: Who Is The Employer For I-9 Purposes?
by Nici Kersey
This is one of the biggest questions that large organizations struggle with in the I-9 context: Who do I list as the employer on my Form I-9? The question seems simple, but the answer is anything but clear.
The applicable regulations define employer as “a person or entity … who engages the services or labor of an employee.” (8 CFR 274a.1(g)) An “entity” is defined as a corporation, partnership, joint venture, or similar organization. (8 CFR 274a.1(b)) Thus, many organizations take the position that each legal entity (determined by reference to Federal Employer Identification Number or FEIN) is a separate employer. The consequence is that, any time an employee transfers from one legal entity to another within the same organization, the new legal entity treats the employee as a new hire, completing a new I-9 and, if the receiving legal entity is registered for E-Verify, running the “new hire” through the E-Verify system. While this may be quite a bit of work, it is – for many – the cleanest way to handle I-9s. One business unit won’t be blaming another for errors when an I-9 is forwarded, and I-9s are less likely to go missing in the transition.
Other organizations take the position that the employer is whichever body actually controls the employee’s work from day-to-day. A 1993 INS memo (the “other” Virtue memo) confirms that this approach is acceptable when the entity treated as the “employer” is the entity with control over the hiring/firing of the employees for whom it completes/retains I-9s. For a large organization with centralized HR functions, this approach may work well.
In reality, though, most organizations do not fit neatly into one box or another. Some HR functions are centralized, but others are handled by the individual entities. Payroll may be handled by a subset of the organization’s entities, and while some entities may list the larger organization’s name as “employer” on the I-9, other entities likely list their own.
The determination as to who is the employer should only be made after considering numerous factors:
While my preference has likely become clear (I was the kid who wouldn’t eat her corn if it had touched the peas), the decision – one way or the other – should not be made without considering the questions above – and likely others as well. It is a big decision, affecting areas other than immigration.
Nici Kersey is an associate at Seyfarth Shaw LLP. As a leader within the Seyfarth Workforce Authorization Team (SWATeam), Ms. Kersey's immigration practice focuses on workforce authorization compliance issues. She provides training and drafts policies relating to I-9s, E-Verify, government investigations, and other issues relating to compliance with immigration laws and regulations. Ms. Kersey frequently conducts compliance audits for clients in a wide range of industries across the U.S. She has drafted numerous articles about I-9 compliance and policy development and is frequently asked to speak about E-Verify, I-9s, and related issues.
The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.