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Do you hire employees in Colorado? Are you concerned about random government audits, especially those that can lead to costly penalties? If so, then take note that the Colorado Department of Labor and Employment (CDLE) has released a new mandatory Affirmation of Legal Work Status form that must be used by employers for new hires (within the state) who are hired on or after Oct. 1, 2014.
The form (which has a revision date of 09/01/14) can be downloaded here.
For those HR and hiring managers who may be new to the wonderful world of employment eligibility verification, let’s take a quick trip down memory lane and revisit Colorado’s rather unique employment verification law.
Colorado’s Employment Verification Law in a Nutshell
Since Jan. 1, 2007, the Colorado employment verification law has required Colorado employers to verify and document the work authorization of all newly hired employees. Sounds familiar, right? That’s because the law basically mirrors the federal I-9 requirements with a few minor exceptions. Here’s where it gets interesting. Within 20 days after hiring a new employee, each Colorado employer must also: (1) complete and retain a written or electronic copy of an entirely separate affirmation form and (2) retain copies of the identity and work authorization documents presented by the employee during the I-9 process (e.g., driver’s license, social security card, etc.).
How would this play out? Here’s an example:
John is hired by Acme Corporation in Colorado to work at their Denver Store on October 1. Rita (John’s manager) ensures that John completes section 1 of the Form I-9, and then she completes section 2 after examining John’s identity and employment authorization documents. Since John is being hired in Colorado, Rita will make copies of John’s documents for retention and also complete the Colorado Affirmation of Legal Work Status Form (using the most recent version).
Sounds pretty simple, right? But as with most things I-9 related … some questions will eventually emerge. Here are some of the most frequently asked questions.
Frequently Asked Questions
Question: Which employers does the law cover?
Answer: Technically, the law applies to all private and public Colorado employers.
Q: Let’s say I hire an employee out of state, and then he/she moves to Colorado. Do I need to complete the affirmation form and retain the I-9 supporting documents?
A: The law would only apply to this employee if he/she moves to Colorado within 20 days of hire.
Q: How long do I have to retain the copies of the affirmation form and the identity and employment authorization document(s)?
A: The employer must retain the affirmation forms and the copies of the identity and employment authorization document(s) for the term of employment of each employee. This retention rule is different than the federal I-9 requirement, which states that employers must retain the I-9 (and copies of supporting documents if retained) of terminated employees for the later of 3 years after the date of hire or one year after termination.
Q: What can an employer do if they have not complied with the law?
A: This one may seem counter-intuitive at first, but if you have not properly completed the affirmation form within 20 days of hiring the employee, or you have not made and retained copies of employee identity and employment authorization documentation within 20 days of hiring the employee, you should not attempt to correct the oversight. Here is the official wording from the CDLE:
DO NOT complete an affirmation form for the affected employee(s). The employer cannot complete a valid form once the 20 days have elapsed since hire.
DO NOT backdate or otherwise enter incorrect information onto the form for the affected employee(s). The employer must not enter false or fraudulent information onto the form.
DO NOT attempt to make and retain copies of employee identity and employment authorization documentation if you did not comply with this requirement within 20 days of hiring the employee. Seeking such documentation after the 20 days have elapsed does not comply with Colorado law, and may also violate separate federal immigration laws.
DO comply with the employment verification law for all new hires going forward. The employer must: (1) properly complete affirmations, and (2) make and retain copies of employee identity and employment authorization documentation, within 20 days of hire for all employees hired after the discovery of the historical noncompliance. Following the steps above, and engaging in other appropriate compliance actions, may reduce the likelihood of a fine, or may mitigate the value of a fine, depending upon the circumstances. Consult with an attorney for legal advice.
Basically, they are saying that if you fail to make the affirmation and retain copies once the 20-day period has lapsed, there’s nothing you should do except to make sure it doesn’t happen again in the future. You will, however, need to note the oversight in the event you are audited.
Q: What are the penalties for noncompliance?
A: An employer who, (1) with reckless disregard, fails to submit the documentation required by the law, or who, (2) with reckless disregard, submits false or fraudulent documentation, shall be subject to a fine of not more than $5,000 for the first offense, and not more than $25,000 for the second and any subsequent offense.
The “reckless disregard” standard is a rather high legal threshold that requires intentional, knowing, or willful conduct on the part of the employer. Practically speaking, this will usually only result in a fine if the organization fails to respond to audit requests, engages in backdating, or is found to be noncompliant on a re-audit.
Q: How many audits have been conducted?
A: The CDLE has conducted more than 7,000 audits since the law’s inception (and average about 30 audits per week). They have four full-time staff members who do nothing but audit Colorado employers under the law.
Q: How is an employer chosen for an audit?
A: The vast majority of audits are conducted at random, with employers being selected based on their industry. The CDLE also conducts audits based upon complaints, as well as re-audits of noncompliant behaviors. It’s important to note that complaints cannot be submitted anonymously (in order to prevent competitors and others from unfairly subjecting employers to scrutiny).
Q: How does the audit process work?
A: The CLDE will send you a letter by mail to request copies of the affirmation forms and supporting documents. Typically, you will be given two weeks to respond, but extensions are possible for extenuating circumstances. The CDLE does not want you to send copies of the Form I-9 or any other employee-related file (apparently, they’ve been provided all manner of documents including health forms, resumes, etc.)
Q: How many employers have been fined?
A: The CLDE has fined over 180 different employers and collected hundreds of thousands of dollars in fines.
Although it appears that employers have been getting better at understanding (and complying with) the Colorado Employment Verification law, the rate of noncompliance is still rather high. According to the CDLE, almost half the employers audited either do not complete the affirmation forms or do not retain copies of the supporting documents. Many of them even respond that they don’t know what an I-9 form is.
As with most areas of I-9 compliance, employers are well-advised to include Colorado (and other state-specific requirements) in their I-9 and E-Verify policies and procedures documents. Fortunately, the CDLE maintains a
very comprehensive site on the Colorado Employment Verification Law which contains the law, FAQs, a fact sheet, and the all-important affirmation form.
Employers should also consult with experienced immigration counsel to develop appropriate training programs, which balance the requirements of the law against potential discrimination concerns. Lastly, employers looking to streamline their I-9 and E-Verify operations electronically, should carefully research vendors and choose a smart electronic I-9 system which automatically includes the appropriate state affirmation and enforces rules on retaining document copies.
John Fay is an immigration attorney and general counsel at
LawLogix Group Inc., a provider of electronic I-9 compliance and case management software.
Copyright 2014 © LawLogix. All rights reserved.
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