Employment Verification: Challenges Exist in Implementing a Mandatory Electronic Employment Verification System
Released: 2008-05-06T00:00:00

Letter

Background

In 1986, IRCA established the employment verification process based on employers’ review of documents presented by employees to prove identity and work eligibility. On the Form I-9, employees must attest that they are U.S. citizens, lawfully admitted permanent residents, or aliens authorized to work in the United States. Employers must then certify that they have reviewed the documents presented by their employees to establish identity and work eligibility and that the documents appear genuine and relate to the individual presenting them. In making their certifications, employers are expected to judge whether the documents presented are obviously counterfeit or fraudulent. Employers are required to retain the Form I-9 and provide it, upon request, to officers of the Departments of Homeland Security and Labor and the Department of Justice’s Office of Special Counsel for Immigration Related Unfair Employment Practices for inspection. Employers generally are deemed in compliance with IRCA if they have followed the Form I-9 process, including when an unauthorized alien presents fraudulent documents that appear genuine. Following the passage of IRCA in 1986, employees could present 29 different documents to establish their identity and/or work eligibility. In a 1997 interim rule, the former U.S. Immigration and Naturalization Service (INS) reduced the number of acceptable work eligibility documents from 29 to 27.

The Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA) of 1996 required the former INS and SSA to operate three voluntary pilot programs to test electronic means for employers to verify an employee’s eligibility to work, one of which was the Basic Pilot Program. The Basic Pilot Program was designed to test whether pilot verification procedures could improve the existing employment verification process by reducing (1) false claims of U.S. citizenship and document fraud, (2) discrimination against employees, (3) violations of civil liberties and privacy, and (4) the burden on employers to verify employees’ work eligibility.

In 2007, USCIS renamed the Basic Pilot Program the Employment Eligibility Verification program and later in the year changed the name to E-Verify. E-Verify provides participating employers with an electronic method to verify their employees’ work eligibility. Regardless of whether employers participate voluntarily in E-Verify, they are still required to complete Forms I-9 for all newly hired employees in accordance with IRCA. After completing the forms, those employers participating in the program query E-Verify’s automated system by entering employee information provided on the forms, such as name and social security number, into the E-Verify Web site within 3 days of the employee’s start date. The program then electronically matches that information against information in SSA’s Numident database and, if necessary, DHS databases to determine whether the employee is eligible to work. E-Verify electronically notifies employers whether their employees’ work authorization was confirmed. Those queries that the DHS automated check cannot confirm are referred to USCIS staff, called immigration status verifiers, who check employee information against information in other DHS databases. The E-Verify program process is shown in figure 1.

In cases when E-Verify cannot confirm an employee’s work authorization status either through the automatic check or the check by an immigration status verifier, the system issues the employer a tentative nonconfirmation of the employee's work authorization status. In this case, the employers must notify the affected employees of the finding, and the employees have the right to contest their tentative nonconfirmations by contacting SSA or USCIS to resolve any inaccuracies in their records within 8 federal working days. During this time, employers may not take any adverse actions against those employees, such as limiting their work assignments or pay. After 8 days, employers are required to either immediately terminate the employment, or notify DHS of the continued employment, of workers who do not successfully contest the tentative nonconfirmation and those whom the program finds are not work-authorized.

The E-Verify program uses the same system as USCIS’s Systematic Alien Verification for Entitlements Program, which provides a variety of verification services for federal, state, and local government agencies. USCIS estimates that more than 150,000 federal, state, and local agency users verify immigration status through the Systematic Alien Verification for Entitlements Program. SSA also operates the Web-based Social Security Number Verification Service, which employers can use to assure that employees’ names and social security numbers match SSA’s records. This service, designed to ensure accurate employer wage reporting, is offered free of charge. Employer use is voluntary, and approximately 12,000 employers requested more than 25.7 million verifications in 2005, according to the SSA Office of the Inspector General.

USCIS contracted for an independent evaluation of the E-Verify program. Westat, the organization that conducted the evaluation, issued a report on its evaluation findings in September 2007. According to this report, the Westat evaluation examined how well the federal government implemented modifications made to the original Basic Pilot Program and the extent to which the program met its goals to (1) reduce employment of unauthorized workers, (2) reduce discrimination, (3) protect employee civil liberties and privacy, and (4) prevent undue burden on employers. Based on its findings, Westat made recommendations to USCIS and SSA intended to help improve the program.

Mandatory E-Verify Will Require an Increase in Capacity at USCIS and SSA

Mandatory electronic employment verification would substantially increase the number of employers using the E-Verify program, which would place greater demands on USCIS and SSA resources. As of April 2008, more than 61,000 employers have registered to use the program, about 28,000 of whom were active users, according to USCIS. USCIS has estimated that approximately 4,000 employers are registering per month. In fiscal year 2007, USCIS processed about 3.2 million employer queries and for the first 6 months of fiscal year 2008, processed about 2.6 million queries. If participation in the E-Verify program were made mandatory, the program would have to accommodate all of the estimated 7.4 million employers in the United States. USCIS has projected that employers would submit an average of 63 million queries on newly hired employees per year under a mandatory E-Verify program. USCIS officials stated that they have tested the capacity of the E-Verify computer system to handle about four times the projected load of queries that would occur if E-Verify participation were made mandatory for all employers. These tests showed that the E-Verify system can process up to 240 million queries per year, with the purchase of 5 additional servers, exceeding USCIS’s projection of an average of 63 million queries per year under a mandatory E-Verify program.

USCIS has developed cost and staffing estimates for operating a mandatory E-Verify program. Although DHS has not prepared official cost figures, USCIS officials estimated that a mandatory E-Verify program could cost a total of about $765 million for fiscal years 2009 through 2012 if only newly hired employees are queried through the program and about $838 million over the same 4-year period if both newly hired and current employees are queried. Mandatory implementation of E-Verify would also require additional USCIS staff to administer the program, but USCIS was not yet able to provide estimates for its staffing needs. Under the voluntary program, USCIS operated E-Verify with 12 headquarters staff members in 2005, which has now grown to about 121 full-time employees nationwide, with 21 staff members for monitoring and compliance and 11 for status verification operations. According to USCIS, the agency would increase its staffing level based on a formula that considers monitoring and compliance and status verification staffing needs as the number of employers using E-Verify increases.

A mandatory E-Verify program would also require an increase in SSA’s resource and staffing requirements. SSA has estimated that implementation of a mandatory E-Verify program would cost a total of about $281 million for fiscal years 2009 through 2013 and require hiring 700 new employees for a total of 2,325 additional workyears over the same 5-year period. According to SSA, these estimates represent costs if the current E-Verify system is expanded, and any changes to the current process could have significant additional costs to the agency. The estimates include costs for start-up, such as system upgrades, training for current SSA employees, and training, space, and workstations for new employees, and ongoing activities, such as field office visits and system maintenance. SSA’s estimates assume that under a mandatory expansion of the current E-Verify program, for every 100 E-Verify queries, about 1.4 individuals will contact SSA regarding a tentative nonconfirmation.. According to SSA officials, the cost of mandatory E-Verify would be driven by the increased workload of its field office staff due to resolving SSA tentative nonconfirmations, as well as some of the computer systems improvements and upgrades that SSA would need to implement to address the capacity of a federal mandatory program. Moreover, the final number of new full-time staff required would depend on both the legislative requirements for implementing mandatory E-Verify and the effectiveness of efforts USCIS has underway to decrease the need for individuals to visit SSA field offices. SSA officials told us that SSA would need time and a phased-in approach for implementation of a mandatory E-Verify program in order to handle the increased workload for SSA field offices.

USCIS and SSA Are Implementing Plans to Reduce Delays and Improve Efficiency in the E-Verify Process

In prior work, we reported that secondary verifications lengthen the time needed to complete the employment verification process. The majority of E-Verify queries entered by employers—about 92 percent—confirm the employee is authorized to work within seconds. About 7 percent of queries are not confirmed by the initial automated check and result in SSA tentative nonconfirmations, while about 1 percent result in DHS tentative nonconfirmations. With regard to the SSA tentative nonconfirmations, USCIS officials told us that the majority of erroneous tentative nonconfirmations occur because employees’ citizenship status or other information, such as name changes, is not up to date in the SSA database, generally because individuals have not notified SSA of information changes that occurred. SSA updates its records to reflect changes in individuals’ information, such as citizenship status or name, when individuals request that SSA make such updates. USCIS officials stated that, for example, when aliens become naturalized citizens, their citizenship status, updated in DHS databases, is not automatically updated in the SSA database. When these individuals’ information is queried through E-Verify, a tentative nonconfirmation would be issued because under the current E-Verify process, those queries would only check against SSA’s database; they would not automatically check against DHS’s databases. Therefore, these individuals would have to go to an SSA field office to correct their records in SSA’s database.

USCIS and SSA are planning to implement initiatives to help address SSA tentative nonconfirmations, particularly those issued for naturalized citizens, with a goal of reducing the need for employees to visit SSA field offices. For example, in May 2008, USCIS plans to launch an initiative to modify the electronic verification process so that employees whose naturalized citizenship status cannot be confirmed by SSA will also be checked against DHS’s databases. A query that could not be confirmed by SSA would be automatically checked against DHS’s databases. If the employee’s information matched information in DHS’s databases and the databases showed that the person was a naturalized U.S. citizen, E-Verify would confirm the employee as work authorized. USCIS and SSA intend for this modification to enable USCIS to check naturalization status before an SSA tentative nonconfirmation is issued as a result of the naturalized citizen’s information not matching citizenship information in SSA’s database. According to USCIS, this should help eliminate the need for the employee who is a naturalized citizen to travel to an SSA field office before being confirmed as work authorized. USCIS has projected that as it implements this modification, the number of tentative nonconfirmations should also be reduced. It remains to be seen by how much the number of tentative nonconfirmations will be reduced as a result of this modification. Furthermore, in May 2008 USCIS plans to modify the E-Verify process so that naturalized citizens who receive a citizenship-related mismatch will be able to call DHS directly to resolve this mismatch rather than having to visit an SSA field office in-person to resolve the mismatch. In addition USCIS and SSA are exploring options for updating SSA records with naturalization information from DHS records. Although this could help to further reduce the number of SSA tentative nonconfirmations, USCIS and SSA are still in the planning stages, and implementation of this initiative may require significant policy and technical considerations, such as how to link records in SSA and DHS databases that are stored according to different identifiers.

USCIS and SSA are also implementing additional options to reduce delays and improve the efficiency of the verification process. USCIS stated that it is adding databases to the E-Verify program, increasing the number of databases against which queries of employees’ information are checked. For example, USCIS stated that it is incorporating real-time arrival data for noncitizens from the Inter-Agency Border Inspection System (IBIS) database, which tracks individuals, to help reduce the number of tentative nonconfirmations issued for newly arrived noncitizens queried through E- Verify. SSA has also coordinated with USCIS to develop an automated notification capability, known as the Employment Verification SSA Tentative Nonconfirmation Automated Response (EV-STAR) system. This system, available in all SSA field offices, became operational in October 2007 and allows SSA field office staff to view the same information that is provided to employers through E-Verify. In addition, SSA field office staff can notify the employer of the status of and any actions taken on the employee’s record to resolve the tentative nonconfirmation and, through EV-STAR, this information is directly updated in E-Verify. USCIS and SSA officials stated that EV-STAR has helped to reduce the burden on SSA, employers, and employees in resolving SSA tentative nonconfirmations. These efforts may help improve the efficiency of the verification process. However, they will not entirely eliminate the need for some individuals to visit SSA field offices to update their records, as USCIS and SSA efforts do not address all types of changes that may occur in individuals’ information and result in the issuance of tentative nonconfirmations, such as individuals’ name changes.

USCIS has Identified Areas where E-Verify is Vulnerable to Fraud, but Proposed Actions Do Not Address All Types of Fraud and Raise Privacy Concerns

In our prior work, we reported that E-Verify enhances the ability of participating employers to reliably verify their employees’ work eligibility. The program also assists participating employers with identification of false documents used to attempt to obtain employment. When newly hired employees present false information, E-Verify will not confirm the employees’ work eligibility because their information, such as a false name or social security number, would not match SSA and DHS databases. However, the current E-Verify program cannot help employers detect forms of identity fraud, such as cases in which an individual presents genuine documents that are borrowed or stolen because the system will verify an employee when the information entered matches DHS and SSA records, even if the information belongs to another person.

USCIS has taken steps to reduce fraud associated with the use of genuine documents in which the original photograph is substituted for another. A photograph screening tool was incorporated into E-Verify in September 2007 and is accessible for most employers registered to use E-Verify. According to USCIS officials, the photograph screening tool is intended to allow an employer to verify the authenticity of a lawful permanent resident card (“green card”) or an employment authorization document, both of which contain photographs of the document holder. As a part of the E- Verify program, the photograph screening tool is used in cases when an employee presents a green card or employment authorization document to prove his or her work eligibility. The employer then inputs the card number into E-Verify, and the system then retrieves a copy of the employee’s photograph that is stored in DHS databases through the photograph screening tool. The employer is then supposed to match the photograph shown on the computer screen with the photograph on the original or photocopy of the employee’s lawful permanent resident card or employment authorization document and make a determination as to whether the photographs match. In completing the Form I-9, the employer is required to review the documents presented by an employee to prove identity and work eligibility and to certify that the documents appear genuine and relate to the individual presenting them. According to USCIS, for about 5 percent of employee queries that are run through E- Verify, employees present a green card or employment authorization document as identification.

The use of the photograph screening tool is currently limited because newly hired employees who are queried through the E-Verify system and present documentation other than green cards or employment authorization documents to verify work eligibility—about 95 percent of E- Verify queries—are not subject to the tool. Expansion of the photograph screening tool would require incorporating other forms of documentation with related databases that store photographic information, such as passports issued by the Department of State and driver’s licenses issued by states. Efforts to expand the tool have been initiated, but are still in the early planning stages. For example, according to USCIS officials, USCIS and the Department of State have begun exploring ways to include visa and U.S. passport documents in the tool, but these agencies have not yet reached agreement regarding the use of these documents. The Department of State is working with DHS to determine the business processes and system requirements of linking passport and visa databases to E-Verify. Additionally, USCIS is negotiating with state motor vehicle associations to incorporate driver’s license photographs into E-Verify, and is seeking state motor vehicle agencies that are willing to participate in an image-sharing pilot program. As of April 2008, no motor vehicle agencies have yet officially agreed to participate in the pilot program.

As USCIS works to address fraud through data sharing with other agencies, privacy issues—particularly in regards to sharing employee information with employers—may be a challenge. In its 2007 evaluation of E-Verify, Westat reported that some employers joining the Web Basic Pilot were not appropriately handling their employees’ personal information. For example, some employers did not privately inform employees that queries of the employees’ information through E-Verify resulted in tentative nonconfirmations. The report also pointed out that anyone wanting access to the system could pose as an employer and obtain access by signing a MOU with the E-Verify program. USCIS officials told us that taking actions to ensure that employers are legitimate when they register for E-Verify is a long term goal for the program. However, according to USCIS officials, implementing such controls to verify employer authenticity may require access to information from other agencies, such as Internal Revenue Service-issued employer identification numbers, to which USCIS currently does not have access. Additionally, some states and agencies have raised the issue of employee privacy. Representatives of motor vehicle agencies have expressed concerns in regards to the potential threats to customer privacy should their digital images be accessible to employers. USCIS is working to address these privacy concerns. However, it remains to be seen whether USCIS will be able to fully address all privacy concerns related to data and photograph sharing and use among agencies and employers.

While USCIS Created a Monitoring and Compliance Branch, Work Remains to Staff the Branch, Develop Tools, and Finalize Enforcement Protocols

E-Verify is vulnerable to acts of employer fraud, such as when the employer enters the same identity information to authorize multiple workers. Moreover, although Westat has found that most participating employers comply with E-Verify program procedures, some employers have not complied or have misused the program, which may adversely affect employees. The findings from the Westat report showed that while changes to the E-Verify program appear to have increased employer compliance with program procedures compared to the previous version of the program, employer noncompliance still occurred. For example, Westat reported that some employers used E-Verify to screen job applicants before they were hired, an activity that is prohibited under E- Verify procedures. Additionally, some employers took prohibited adverse actions against employees—such as restricting work assignments, reducing pay, or requiring employees to work longer hours or in poor conditions—while they were contesting tentative nonconfirmations. Finally, Westat found that some employers did not always promptly terminate employees after receiving confirmation that the employees were not authorized to work in the United States. USCIS reported that it is working to address these issues by, for example, conducting education and outreach activities about the E-Verify program.

In 2005, we reported that E-Verify provided a variety of reports that could help USCIS determine whether employers followed program requirements intended to safeguard employees—such as informing employees of tentative nonconfirmation results and referring employees contesting tentative nonconfirmations to SSA or DHS—but that USCIS lacked sufficient staff to review employers’ use of the program. Since then, USCIS has added staff to its Verification Office, created a Monitoring and Compliance branch to review employers’ use of the E-Verify system, and identified planned activities for the branch. As of April 2008, the Monitoring and Compliance branch had 21 staff and planned to hire 32 additional staff in fiscal years 2008 and 2009. Additionally, by January 2009, USCIS plans to establish a regional verification office with 135 staff members to conduct status verification and monitoring and compliance activities.

With regard to compliance and monitoring activities, USCIS has identified 53 employer and employee behaviors of noncompliance and monitors the program for some of these behaviors. These behaviors include, among others, the use of counterfeit documents or substituted identities; use of the E-Verify system that does not follow procedures identified in the MOU between employers and DHS, such as failures to complete training or perform verifications within specific time frames; misuse of E-Verify to discriminate and/or adversely affect employees such as verifying existing employees, prescreening, firing employees who received tentative nonconfirmations, or not firing unauthorized employees; and detecting instances where privacy information is compromised, such as by sharing of passwords or nonemployer access of the system.

Using some of these behaviors, among other things, to monitor employers’ use of E-Verify, USCIS plans to interact with employers who might not be complying with program procedures in four main ways: (1) sending letters or e-mails to advise employers of misuse of the system and to provide appropriate remedies, (2) follow-up phone calls when employers fail to respond to the initial letters or e-mails, (3) audits through which USCIS requests documents and information be sent to the agency from potentially noncompliant employers, and (4) site visits for in-person interviews and document inspection when desk audits reveal cause for further investigation. Under the current voluntary program, USCIS plans to contact about 6 percent of participating employers regarding employer noncompliance. USCIS estimates that under a mandatory E-Verify program, the percentage of employers the agency would contact regarding employer noncompliance would decrease to about 1 to 3 percent. If, as a result of its monitoring activities, USCIS found that it needed to contact more than 3 percent of employers, USCIS officials stated that the agency plans to modify its approach for addressing employers’ noncompliance. As of April 2008, USCIS plans to allocate its monitoring and compliance efforts as follows: 45 percent of its activities would involve sending letters and e-mails to employers; 45 percent would involve follow-up phone calls; 9 percent would involve desk audits; and 1 percent would involve site visits. As part of a mandatory program, USCIS would modify this distribution of monitoring activities by, for example, using letters, e-mails, and phone calls for a larger percentage of interactions with employers. However, USCIS is still in the early stages of implementing its monitoring and compliance activities. Therefore, it is too early to tell whether these activities will ensure that all employers fully follow program requirements and properly use E-Verify under a mandatory program, especially since such controls cannot be expected to provide absolute assurance.

The Monitoring and Compliance branch could help ICE better target its worksite enforcement efforts by providing information that indicates cases of employers’ egregious misuse of the system. Although ICE has no direct role in monitoring employer use of E-Verify and does not have access to program information that is maintained by USCIS unless it requests such information from USCIS, ICE officials told us that program data could indicate cases in which employers or employees may be fraudulently using the system and therefore should help the agency better target its worksite enforcement resources toward those employers. ICE officials noted that, in a few cases, they have requested and received E-Verify data from USCIS on specific employers who participate in the program and are under ICE investigation. For example, USCIS told us that by monitoring use of the E- Verify program to date, staff were able to identify instances of fraudulent use of social security numbers and referred such egregious examples of fraud to ICE. However, USCIS and ICE officials told us that case referrals or requests for information between the two agencies have been infrequent, and information on the resolution of these referrals is not formally maintained by ICE. USCIS expects to complete and implement a compliance tracking system to track referrals to and responses to requests from ICE on compliance cases in fiscal year 2009. USCIS and ICE are also negotiating an MOU to define roles, responsibilities, and mechanisms for sharing and using E-Verify information. Outstanding issues that need to be resolved for the MOU include the type of information that USCIS will provide to ICE through the referral process and the purposes for which ICE will use this information. While the MOU between USCIS and ICE is incomplete, ICE officials anticipate that, if the E-Verify program is made mandatory, they would receive an increased number of referrals for investigation from USCIS. Therefore, ICE officials told us that they plan to require additional resources to follow-up on USCIS referrals. ICE also hopes to be able to use elements of the E-Verify program to detect and track large-scale instances of employer or employee fraud.

This concludes my prepared statement. I would be pleased to answer any questions you and the Subcommittee Members may have.

GAO Contact and Staff Acknowledgments

For further information about this testimony, please contact Richard Stana at 202-512-8777.

Other key contributors to this statement were Burns Chamberlain, Frances Cook, Josh A. Diosomito, Rebecca Gambler, Danielle Pakdaman, Evi Rezmovic, Julie E. Silvers, and Adam Vogt.

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