Kansas v. Garcia: As States Seek to Enforce Federal Immigration Laws, Employers Are Once Again Caught in the Middle

In recent years, employers have found themselves caught in a tug-of-war between the federal government and state governments as to whether states can arrest and prosecute undocumented individuals who are unlawfully employed, due to action or inaction of either the employer or employee. The Supreme Court’s opinion in Kansas v. Garcia, released on March 3, is the latest round in that fight.

Employers in the U.S. must, under federal law, verify a new hire’s identity and authorization to work by timely filling out the Form I-9 and reviewing the acceptable document(s) provided by the new employee. Importantly, federal law includes punishment for employers who fail to properly fill out I-9s, but federal law does not punish undocumented employees for working without proper documentation. Rather, the employee is subject to detention and possible deportation.

Kansas v. Garcia: What Did the Supreme Court Say?

A few years ago, the state of Arizona made it a crime for an undocumented individual to work in that state. In United States v. Arizona, the Supreme Court held that the decision whether to make working without proper documentation a crime rests solely with the federal government, not the state, and it struck down that law. In other words, if the federal government wanted to criminalize the act of working in the U.S. without legal authorization, it could, but states cannot.

This year, in the case of Kansas v. Garcia, the Supreme Court was asked to decide whether a state could criminally prosecute individuals for the state crime of identity theft where individuals used Social Security numbers that were not assigned to them to gain employment. The defendants in the case used the same Social Security number for their I-9s, their W-4s (a Federal tax form), and their K-4s (the state equivalent of the W-4). Key to the case: the federal statute that governs Form I-9 clearly states that information contained in I-9s may not be used for purposes other than those set out in the statute. Criminal prosecution for identity theft under state law is not one of them. The defense argued that because the defendants had used the same Social Security numbers in their I-9s as they had on other employment-related forms, they could not be prosecuted under state law.

The state of Kansas argued that just because a piece of information was included in a Form I-9, that did not prohibit state and local law enforcement from using that information in a criminal prosecution where that same information was contained in other documents—in this case, the individuals’ W-4s and K-4s. The Supreme Court, in a 5-4 decision, sided with Kansas, holding that because the information contained in I-9s—names, addresses, email addresses, dates of birth—could be found in other personnel documents, the mere fact that an employee’s Social Security number is contained in an I-9 does not mean that state law enforcement cannot use that information to prosecute the defendants for state crimes relating to identity theft.

What Does This Mean for Employers?

There is a lot of discussion around what Kansas v. Garcia means with regard to federal preemption and states’ rights, but from an employer’s I-9 compliance standpoint, Kansas v. Garcia has little impact; employers must continue to comply with all I-9 requirements or face possible federal civil or criminal penalties.

Some best practices employers should keep in mind:

• Keep I-9s separate and apart from personnel records, and under lock and key (hopefully electronically, but physical if your I-9 records are still paper-based) with very restricted access.

• Require a subpoena before turning over any company documents to law enforcement, whether I-9s or personnel records. Ensure that your front desk personnel know how to respond to law enforcement should they arrive at your offices in person.

• When responding to document subpoenas from federal or state officials, be sure to read the subpoena carefully and turn over only those documents specifically listed in the subpoena.

I-9 Inspections Are on the Rise.

Now is a good time to review your I-9s and your own practices with regard to I-9s, as inspections are on the rise. In recent years, I-9 inspections by the government—Immigration and Customs Enforcement (ICE) and Homeland Security Investigations (HSI)—have increased threefold (from 1,360 to 5,981 per year), while worksite investigations have increased even more dramatically (from 1,691 to 6,848 per year). Potential fines are also increasing—paperwork “foot fault” violation fines can now range between $230 and $2,292 per employee. Civil penalties for knowingly hiring or employing unauthorized workers currently range from $573 to $4,586 per employee for the first violation. Second- and third-violation civil penalties can range from $4,586 up to $22,972 per employee.

Kansas v. Garcia should be a reminder for all employers to make sure their I-9 procedures are compliant with the law and that their I-9s on file are in good shape, as well as reminding employers of the importance of ensuring that employees understand what to do in the event that law enforcement request to view I-9s.

For additional information, contact TriNet.

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Samantha Wellington Senior Vice President, Chief Legal Officer and Secretary, TriNet		Thomas Rose Vice President, Customer Solutions, TriNet