Tag: i-9

Employee Files: Basic Training for Small Business Owners

You have your employee’s I-9 Forms over on the cabinet and their W-2′s in a manila envelope marked “Tax Stuff” near your printer and in between the new ink cartridges and paper stock. Yesterday, Sandra, your office administrator stapled her fingers together, and went home “sick”. You’re sure that she has used up all of her medical leave by now, but you cannot find the records. Sound familiar? The value of properly maintained Employee Files can be easily measured by the cost of not doing so which can range from as little as a day’s pay all the way up to tens of thousands of dollars in government fines.

An Employee File is a living document that records a history of a person’s work experience, and is constructed of 6 folders, which are labelled as follows and include the noted information:

    1. Personnel – employment application, date of hire, salary and position/promotion history, performance reviews, emergency contact information, and a Jury Duty log.
    2. I-9 Form (or Employment Eligibility) - only the Form, which should be reviewed once a year to update expiring documentation and changes in marital status.
    3. Payroll - copy of the I-9, State & Federal tax forms, date of hire, salary and position/promotion history, insurance forms, and a business travel log.
    4. Medical – insurance forms, emergency contact information, and a medical leave log.
    5. Attendance - individual logs for Jury Duty, medical leave, business travel and vacation.
    6. Disciplinary – performance reviews, and disciplinary action records.

This is pretty straight forward stuff. However, the Personnel Folder should be considered a stand-alone document, which could be shared. Therefore, there are certain documents which the small business employer should keep in the Employee File but specifically NOT in the Personnel Folder. These include:

  1. Medical information such as doctor notes or correspondence and disability paperwork. These should only be kept in the Medical Folder.
  2. Personal and/or informal notes or thoughts on an employee’s performance. These should only be kept in the Disciplinary Folder.
  3. Historical insurance information such as claims, claims adjustments, and/or disputes. These should only be kept in the Medical Folder.

You just saved yourself some money! Sandra has used up all of her medical leave, so you dock her one day’s wages. You also have found out that she got divorced a few months ago, and you amend the marital status section of her I-9 Form. That easy mistake could have cost you $1,000 during a routine HR audit.

HRInsights FACT: Properly maintained Employee Files reinforce compliance and adherence to company policies which help you avoid costly mistakes and errors.

Each I-9 Form Error Can Cost Up To $1,400

Per the Immigration Reform and Control Act, all employers must have their employees complete an I-9, Employment Eligibility Verification.  It’s also important to send in a W-2 Form or 1099 Form.  All HRI Members can access the I-9 Form in Answers >> Onboarding >> Validate the Right to Work in the U.S.  Employees are required to provide documentation as to their eligibility to work in the U.S.  The documents an employer can accept are on page two of the form.  It is important that you keep completed I-9’s and supporting documentation in a binder separate from personnel files and locked for safe keeping.  Although the act does not require employers to make a copy of the Form I-9 documents, federal officers have commented that they prefer to see a copy of the documents when performing audits.  Having the copies available can go a long way to show that an employer has complied with the act’s verification process in good faith.

Some common offenses are:

  • Failure to properly complete an I-9
  • Knowingly hiring, continuing to employ, or contacting to obtain the services of a person without employment validation
  • Providing or knowingly accepting false social security cards
  • Pattern and practice of I-9 compliance failure

Your Organization can protect itself by:

  • Provide someone to read and/or explain the I-9 Form to applicants/employees who are unable to read or understand the form
  • Remember to have the person who assisted the applicant/employee complete the preparer/translator section of the I-9 Form
  • Require applicants who are citizens and nationals of the U.S. to complete the I-9 Form and present the required documents
  • Don’t accept photocopies of documents; employees/applicants must present original documents

Staying Compliant with New Efforts to Crack Down on Illegal Employees

Per an article dated May 4, 2009, written by Bill Leonard, Senior Writer for SHRM Online (Society for Human Resource Management), Federal Agents with Immigration and Customs Enforcement (ICE) will concentrate on building cases against businesses that are suspected of hiring undocumented immigrants before they raid workplaces and round up any illegal workers.

Mary Pivec, a partner with Keller Heckman, LLP in Washington, D.C., said that “ICE’s new enforcement guidelines should be a wake-up call for employers and that businesses need to review their hiring and documentation review policies and procedures carefully.”

A fact sheet has been posted on the agency’s website outlining the new enforcement guidelines.  The fact sheet makes it clear that the agency will continue to arrest and process for ejection any undocumented workers identified during worksite investigations.  The key change is that their focused effort will be on prosecuting employers who willingly hire illegal workers.  The prosecution could include no only business owners, but also Supervisors and Managers guilty of knowingly hiring undocumented workers.

The best course of action for employers is to ensure that they have an I-9 and legitimate supporting documentation to prove all employees are legally eligible to work in the United States.