E-Verify Explained, the Free Federal Check Most Employers Skip

Take away the work and you change the math for everyone from the smuggler to the family deciding whether the trip is worth the risk. Almost every argument about illegal immigration collides with that observation, because people come where there is work. Yet for decades Americans have argued about walls, caravans, courts and quotas, so why does so little of the national shouting match concern the one federal tool that is aimed directly at the job?

That tool is called E-Verify. It is free. It is run by the Department of Homeland Security with the Social Security Administration. It has been around for decades. And in most of America, an employer can ignore it entirely and be perfectly within the law. I think that is one of the great overlooked facts of the immigration debate, and I want to explain it in plain English: what the system does, where it came from, what the Supreme Court said about it, and what the fair objections are.

The problem it was built to solve

Start with the law that came before it. In 1986 Congress passed the Immigration Reform and Control Act, signed by President Reagan. The bargain, which I describe in Reagan Signed the 1986 Amnesty and Got Only Half of the Bargain, had two parts: a legalization for people already here, and new rules to stop future unlawful hiring. The second part created what we call employer sanctions, which make it unlawful to knowingly hire a worker who is not authorized to work.

To make that enforceable, the law required every employer to examine documents from every new hire and complete a form, the Form I-9. The employee shows documents that establish identity and authorization to work, and the employer records what was shown. I walk through the form in detail in The Small-Business Owner's I-9 Hiring Checklist, Line by Line.

The weak point is obvious. An employer looks at a document and decides whether it "reasonably appears to be genuine." But a good counterfeit card or a borrowed Social Security number can pass that eyeball test. The employer is not a forensic document examiner, and the law does not ask him to be. The I-9 process verifies that the paperwork exists, not that the paperwork is true. The gap between those two things is what E-Verify was designed to narrow.

How E-Verify works, step by step

E-Verify is an internet-based system that lets an employer check the information on the I-9 against government records. Here is the process.

1. The employee completes the I-9 as usual. E-Verify does not replace the form. It follows it.
2. The employer enters the information into E-Verify. This includes the employee's name, date of birth, Social Security number, and citizenship or immigration status, along with details of the document presented. The employer must create the case no later than the third business day after the employee starts work. So if someone starts on a Monday, the case is due by Thursday, counting Tuesday, Wednesday and Thursday as the three business days.
3. The system checks the data. E-Verify compares what was entered with records at the Social Security Administration and the Department of Homeland Security. For certain documents, such as a passport, a permanent resident card or an employment authorization document, the system can also show the employer a photo from the government's records to compare with the photo on the document.
4. The employer gets a result. In most cases the answer is "Employment Authorized," and that is the end of it.
5. If the data does not match, the result is a Tentative Nonconfirmation. This is the important step. A "tentative" result is not a finding that the person is unauthorized. It is a signal that the government's records and the information entered do not line up, which can happen for many innocent reasons.
6. The employee gets to contest. The employer must give the worker a notice, and the worker decides whether to dispute the result. If the worker does, he or she has eight federal government working days to contact the Social Security Administration or the Department of Homeland Security to resolve it. During this time the employer is not allowed to fire, suspend or delay training of the worker because of the tentative result.
7. A final result closes the case. Either the discrepancy is resolved and the case is closed as employment authorized, or the employee does not contest or cannot resolve it and the result becomes a Final Nonconfirmation, after which the employer may terminate employment.

Two rules matter for fairness. The employer may use E-Verify only after the job offer is accepted and the I-9 is done. It is not a tool to screen applicants before hiring, and misusing it that way can violate the law. And the employer must apply it consistently, to all new hires, not only to those who look or sound foreign. Selective use is a recipe for discrimination claims, and rightly so.

Where it came from

The 1996 immigration law I discuss in The 1996 Immigration Law Behind Most of Today's Border Fights included the first version of this idea. It created voluntary pilot programs to test ways of confirming work authorization. The pilot that matured, then called Basic Pilot, started in a small number of states in 1997 and was later opened to employers across the country. In 2007 the system was renamed E-Verify.

Notice the word "voluntary." Congress was cautious. The pilot was an experiment, employers joined by choice, and Congress extended it in stages over the years. Whether to make it mandatory nationwide has been debated in Congress for a long time, and the answer so far has been no. That is the heart of the puzzle I opened with.

Where it is required

Because Congress left the federal baseline voluntary, the requirements come from a patchwork.

Federal contractors. A rule of the Federal Acquisition Regulation, which took effect on September 8, 2009 after earlier delays, requires many federal contractors and subcontractors to use E-Verify for new hires working on covered contracts and for certain existing employees assigned to them. Companies that earn federal dollars are being asked to meet a higher standard.

States. A number of states have passed laws requiring some or all employers to use E-Verify, with different coverage rules, such as employer size, public versus private employers, and penalties. Because these laws change, the place to check is your state legislature's website and the E-Verify pages at the Department of Homeland Security. I am not going to list states here, because I do not want to hand you a list that may be out of date. Some of these state laws are collected in the discussion of red-state policy in What Can a State Do About Immigration? Ten Answers From Arizona v. United States.

Voluntary employers. Everyone else can join, and many do, usually by signing an agreement with the government and training the people who run the checks.

The Arizona law and the Whiting decision

The most important legal test of the system came out of Arizona. In 2007 the Legal Arizona Workers Act was signed into law by Governor Janet Napolitano, a Democrat who later became Secretary of Homeland Security. It took effect at the start of 2008. The law said that Arizona employers who knowingly or intentionally hire unauthorized workers could lose their business licenses, and it required all Arizona employers to use E-Verify for new hires.

Business groups led by the U.S. Chamber of Commerce sued, arguing that federal law pre-empts a state from doing this. The federal employer sanctions law has a clause that prevents states from imposing "civil or criminal sanctions" on employers for hiring unauthorized workers, "other than through licensing and similar laws." The argument turned on that exception and on whether a state can require something Congress made voluntary.

In Chamber of Commerce v. Whiting, decided on May 26, 2011, the Supreme Court sided with Arizona. Chief Justice Roberts wrote for the Court that the licensing provisions fell within the exception Congress wrote into the law, and that the state's E-Verify requirement was not pre-empted either. Congress had made the federal program voluntary at the federal level, the Court reasoned, but had not forbidden states from requiring its use, and had not declared that the federal program should be free of all state mandates. Justice Kagan did not take part in the case.

This decision matters for the federalism argument, because it recognized a real space for states in the employment side of immigration, beyond what they may do about entry and removal. How far that space reaches, and where it ends, is the subject of the cases I cover in the Arizona post linked above.

Why a conservative should care

The case for E-Verify is a mix of law-and-order and common sense.

First, it targets the incentive. Every illegal hire is a decision by an employer, and the employer is a citizen or a business inside our law. If you can raise the cost of hiring off the books, you reduce the demand for that labor, and the effects reach well beyond the border.

Second, it levels the field. An honest employer who verifies his workforce competes against a competitor who does not, and who therefore may pay less and avoid payroll taxes. A mandatory check protects the honest business from being undercut by the dishonest one.

Third, it protects workers. Legal workers' wages and opportunities can be undermined when employers can easily hire people off the books. A reliable verification system is one tool against that.

Fourth, it does not require new border infrastructure or new prisons. It is a database check at the moment of hiring, which makes it one of the cheaper enforcement tools in the whole system.

The fair objections

Now the other side, stated honestly. These are real concerns, and conservatives who care about small business should take them seriously.

Accuracy. Government databases contain errors. Names change with marriage, spellings vary, and records lag. A mismatch can fall on a citizen as easily as anyone else. The tentative nonconfirmation process exists to correct such errors, but it asks a worker to spend time resolving a problem he did not cause. Studies and government reports over the years have looked at error rates, and I will not quote a figure I cannot verify. Read the reports from DHS and the Government Accountability Office for yourself.

It does not stop identity fraud. If a worker presents genuine information that belongs to someone else, such as a real name and Social Security number stolen from a real person, the data may match and the check will say "authorized." The photo-matching feature closes part of that gap for some documents, but not all of it. Critics are right that E-Verify checks whether the information corresponds to a work-authorized person, not who is presenting it.

Burden on small business. A small employer with no human resources staff may find another compliance system unwelcome, especially if it brings penalties for mistakes. The fair answer is that the process should be simple, the training free, and the penalties proportionate. A federal rule that crushes the corner hardware store is not a victory for conservatism.

Off-the-books work. If E-Verify makes regular hiring harder, some employers will shift to cash payments and informal arrangements. That is a real risk, and it is why verification has to be paired with enforcement against employers who evade the system.

Discrimination risk. If employers misuse the system, for instance by screening only certain applicants, workers can be harmed. The law prohibits that, and agencies enforce it, but the risk is why training matters.

None of these objections is a reason to do nothing. Each one is a reason to build the system carefully: accurate records, fast fixes, clear rules, and real penalties for abuse by either side.

What it means for your family

If you are an employee, you can expect to be asked for your documents, and if the system flags a mismatch, you have rights: a notice, time to contest, and protection from being fired during the dispute. If you are an employer, check whether your state or any federal contract requires E-Verify, and follow the rules for when and how to run it. If you are a voter, notice how rarely the national immigration debate mentions the workplace, and ask your own representatives where they stand on making E-Verify mandatory, and what accuracy fixes they would pair with it. The bills page tracks what Congress has actually considered.

The bottom line

• E-Verify is a free federal system that checks Form I-9 information against Social Security and Homeland Security records, usually within seconds, and it is voluntary for most employers under federal law.
• A mismatch produces a Tentative Nonconfirmation, not a firing. The worker gets notice and eight federal working days to contest, and the employer cannot act against the worker meanwhile.
• It is mandatory for many federal contractors under a rule effective September 8, 2009, and for some or all employers in a number of states. Check your state legislature's website for the current list.
• In Chamber of Commerce v. Whiting (May 26, 2011), the Supreme Court upheld Arizona's licensing law and its E-Verify mandate, which opened the door for state action on the workplace.
• Back it with fixes: accuracy, speed of correction, simplicity for small business, and penalties against both abuse and evasion.