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A “no-match” letter is hard to spot. It is an innocent enough looking notice. It does not mention undocumented workers or the U.S. Department of Homeland Security Immigration and Customs Enforcement (ICE). It comes from the Social Security Administration, which we usually do not think of as a big, bad enforcement agency. But the “no-match” letter can unleash a host of compliance issues for employers if not properly identified and addressed quickly, and it is an early warning that you might be employing workers who are not eligible to work in the United States.
In March, the Trump Administration reinstated the practice of sending “no-match letters” that alert employers to irregularities with their employees’ social security numbers, and possible social security number falsification by employees claiming work eligibility. The federal government has used the letters off and on for years, but this recent announcement directs the Social Security Administration to increase the number of letters sent out. Before, only employers who had ten or more employees with discrepancies would receive letters; now every employer with a “no-match” will get a letter.
No-match letters communicate a simple message: the name or social security number listed on the employer’s W-2 forms does not match Social Security Administration’s records. A “no-match” letter is really just notice of an administrative error. Because there is almost nothing in the letter that signals potential legal liability, these letters often do not get the legal attention they require. Titled Employer Correction Request Notice, these letters usually get routed to the payroll department.
The letter clearly states that it does not provide conclusive proof that the worker is undocumented. However, during ICE audits (which are occurring with increasing frequency), inspectors usually request copies of any no-match letters received, which then become part of enforcement actions.
There are potentially conflicting legal requirements relating to how to respond upon receipt of a no-match letter. Immigration laws forbid employers from hiring or continuing to employ workers who are ineligible to work in the United States. If the discrepancy is the result of falsified documentation, ignoring the letter would be the same as knowingly accepting improper immigration documents. However, terminating employees based on receipt of a no-match letter may constitute discrimination on the basis of citizenship.
There are plenty of benign reasons that trigger issuance of a no-match letter. Quite often, it is a clerical error: a misspelled name or transposed number, or use of compound names that get rearranged by the government’s databases. Other times, the documentation needs to be updated because of a change in an employee’s name due to marriage or divorce. The source of the mistake may lie with the employee, the employer, a third party vendor used to process payroll and tax documents, or even the federal government. The Social Security Administration reported that under its old program, which was discontinued in 2007, one-third of the employees terminated for no-match letters never got the chance to correct the mistake.
Employers should take affirmative steps to avoid receipt of the letter turning into proof that it had actual or constructive knowledge of employing unauthorized workers. The Department of Justice has the authority to assess civil and criminal penalties against entities employing workers known to have inadequate work documentation. Officers or other managers of the employer can even face personal liability for this knowledge.
Employees can and should be active participants in resolving the inaccuracy in the Social Security Administration records. Explain to the employee that clearing up the problem is necessary for them to receive credit for their wages in the accrual of Social Security benefits for the future.
Beware of the common misperceptions about these letters when taking steps to respond. Assuming the subject of the letter is undocumented will create legal liability under state and federal anti-discrimination statutes. Requiring that the employee provide specific documentation to clear up the discrepancy or immediately re-verifying that employee’s status will violate I-9 reporting laws. Reacting too quickly or acting based on assumptions may violate anti-discrimination laws. Not reacting quickly enough may violate federal immigration law. The correct response will demonstrate diligence in getting to the bottom of the irregularity, but caution to avoid jumping to conclusions. Contact legal counsel to devise a plan that is tailored to your situation.
Charlotte Hodde is an attorney at Barran Liebman LLP, where she represents employers on a range of employment laws. For questions related to no-match letters or I-9 reporting, contact Charlotte at 503-276-2102 or firstname.lastname@example.org.