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The Department of Homeland Security (DHS) has issued a final rule rescinding a set of regulations and procedures for employers that receive employee “no-match” letters from the Social Security Administration (SSA).
The final notice to rescind the regulations appeared in the Federal Register on Oct. 7, 2009. It follows an announcement made by DHS Secretary Janet Napolitano three months earlier that the Obama administration had decided to drop the controversial “no-match” rule.
The no-match rule was promulgated in 2007 during the administration of President George W. Bush in an attempt to strengthen enforcement of U.S. immigration laws. The regulation provided guidelines and described the legal obligations of employers that receive “no-match” letters from the SSA. The SSA issues no-match letters if an employee’s name does not correspond correctly to a valid Social Security Number.
The rule stated that a no-match letter could be sufficient to notify an employer that an employee might not be eligible to work in the United States.
The no-match regulation was called a “safe harbor rule,” because employers that complied with the outlined procedures when responding to the letters could receive favorable treatment from enforcement agencies and the court system.
The final rule was issued in August 2007 but immediately faced a challenge in federal court from a coalition of labor unions and business groups, including the AFL-CIO and the U.S. Chamber of Commerce. The lawsuit claimed that DHS overstepped its authority in issuing the regulation and did not follow proper procedures as outlined by the Federal Regulatory Flexibility Act.
A federal district court judge in Northern California agreed with the plaintiffs’ arguments and issued a preliminary injunction blocking the no-match rule from taking effect. In 2008, the DHS responded to the judge’s request to amend the regulation and conduct an audit of the rule’s economic effect on small businesses.
The case was still pending and implementation of the final rule in effect had been put on hold until Napolitano stated that the Obama administration was in favor of rescinding the regulation. The DHS issued a proposed rule to rescind the regulation in August 2009 and asked for comments from the public.
According to DHS officials, 22 written comments were submitted, and several of the comments actually favored enforcement of the no-match rule, stating that guidance for employers was needed concerning what to do when faced with no-match letters.
The Society for Human Resource Management (SHRM) and the American Council on International Personnel (ACIP) submitted comments stating that rescinding the rule would take away much-needed guidance for employers on how to respond to SSA notices and to comply with DHS employee verification requirements. Instead of allowing employer confusion over the issue to continue, SHRM and ACIP suggested that DHS provide a safe harbor for employers who make good faith efforts to resolve discrepancies involving an employee's Social Security number.
In the final Federal Register notice, DHS officials acknowledged that while “additional guidance would be valuable to employers,” there were no grounds to suggest that “if no-match rules are rescinded employers will have no guidance.” The notice stated that DHS has always provided guidance on how employers should comply with the employment verification requirements of federal immigration laws.
The Senate responded in July 2009 by adding a provision to the DHS appropriations bill (S.1298) that would block DHS from rescinding the rule. However, the House-passed version of the bill (H.R. 2892) does not include a similar provision. The differences between the two bills must be reconciled by a conference committee.
Bill Leonard is senior writer for SHRM.
SHRM Seeks Guidance, Safe Harbor on ‘No-Match’ Letters, SHRM Online, Sept. 23, 2009
DHS Issues Proposal to Scrap No-Match Rule, SHRM Online, Aug. 19, 2009
Homeland Security to Drop No-Match Rules, Support E-Verify, SHRM Online, July 8, 2009
SHRM Seeks More Time, Protection in ‘No-Match’ Rule, SHRM Online, May 2, 2008
DHS Finalizes New Rule on No-Match Letters, SHRM Online, Aug. 13, 2007
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