Starting a job is hard, whether you’re the new hire (first-day butterflies, ugh) or the HR professional responsible for managing all their paperwork.
The Form I-9. The Form W-4. The lesser known Form IDEK.
Onboarding and work eligibility compliance are notoriously challenging in the US, especially if you have employees in multiple states. E-Verify is part of the reason why.
E-Verify is an electronic system that cross-references government records to confirm whether employees are eligible to work in the US. Think of it as the traditional paper Form I-9, which is also used to confirm work eligibility, but on technological steroids. Some businesses are required to use E-Verify, depending on their state, municipality, and whether or not they have government contracts in place.
If that last sentence gives you anxiety, you’re in the right place. This guide will cover what E-Verify is, which employers are required to use it, state-specific mandates, penalties for non-compliance, and tips for staying compliant.
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What Is E-Verify?
E-Verify is an online employment verification system operated by US Citizenship and Immigration Services (USCIS) in partnership with the Social Security Administration (SSA). It allows companies to confirm an employee’s eligibility to work in the US by comparing information from their Form I-9 against federal records.
Think of it this way: You already ask new hires to furnish passports, Social Security cards, diverse licenses, or other forms of identification to complete Form I-9. You also ask them for personal details like their legal names and birthdates. The E-Verify system takes things a step further by checking to see whether those I-9 details are accurate. The visual below breaks it down into three simple steps.
According to USCIS statistics, over 1.3 million employers use E-Verify today, with an average of 2,300 signing up for it every week. The uptick is likely thanks to [spoiler alert] the increasingly complex patchwork of state requirements in place today.
Which Employers Are Federally Required to Use E-Verify?
Since the federal government launched the first E-Verify pilot back in 1997, various politicians (from both major parties) have promised and/or threatened to make its usage a requirement of all US businesses.
While the lack of a blanket mandate has made onboarding slightly less painful for many employers, it has muddied things given that others still need to use the system. As of this writing, E-Verify use is required of two camps:
- Federal Contractors and Subcontractors: Since 2007, employers holding federal contracts containing an E-Verify clause are required to use the system to verify the work eligibility of their employees, both current and new. If you’re unsure of what that means for you, you can find all the nitty gritty details in USCIS’s Supplemental Guide for Federal Contractors.
- Employers in Mandatory States: Some states (likely why you’re here) have decided to march to the beat of their own drum, making E-Verify mandatory in certain cases. For instance, several states require private employers or those with state contracts to use the system. We’ll get to that in a second.
State-Specific E-Verify Requirements and Effective Dates
Hope we didn’t keep you waiting. The requirements for E-Verify vary widely across states, from mandates applying to all employers to specific requirements that apply only to public employers or those with government contracts. Here’s a breakdown:
States Requiring E-Verify for All Employers
- Alabama: Effective since 2012, E-Verify is required for all employers with one or more employees in the state of Alabama. Sole proprietorships with no employees are exempt. Penalties range from a three-year probationary period to having your Alabama business license revoked.
- Arizona: Since 2008, Arizona has mandated E-Verify for all employers regardless of size. Businesses must retain each employee’s E-Verify records for at least three years (or for one year after termination, whichever is longer). As of 2024, state lawmakers were also considering making it a requirement for businesses to check the status of independent contractors.
- South Carolina: Since 2021, all employers in the state must use E-Verify. Penalties range from a three-year probationary period to having your South Carolina business license suspended.
- Mississippi: Back in 2011, Mississippi became the first state to require E-Verify of all employers. It also requires them to run 1099 workers (independent contractors) through the system as well.
- North Carolina: E-Verify has been required for employers with 25 or more employees since 2013.
- Georgia: Employers with more than 10 employees are required to use E-Verify. Businesses below this threshold are required to furnish proof that they’re exempt in the form of a signed affidavit.
- Florida: Public employers and contractors have been required to use E-Verify since January 2021. Here’s an important exemption: independent contractors and household staff do not need to be run through the E-Verify system.
Pennsylvania is a special case. The state has an E-Verify mandate, but that’s only applicable to private construction businesses and state contractors. 👷♀️
States Requiring E-Verify for Only Public Employers or Contractors
- Idaho: Required for public employers and contractors since 2009.
- Indiana: State and local government agencies and contractors must use E-Verify.
- Louisiana: State contractors and subcontractors must use E-Verify.
- Michigan: E-Verify is mandatory for contractors and subcontractors of the state’s transportation department.
- Minnesota: State contractors must use E-Verify for contracts over $50,000.
- Missouri: E-Verify is required for public employers and businesses with state contracts since 2009.
- Nebraska: E-Verify is mandatory for state and local contractors as of October 1, 2009.
- Oklahoma: Since 2007, public employers and contractors are required to use E-Verify.
- Pennsylvania: Pennsylvania has required public contractors to enroll in E-Verify since 2013.
- Texas: Texas requires E-Verify for state agencies and contractors.
- Virginia: State agencies and public contractors with over 50 employees are required by the state to use E-Verify.
- West Virginia: Public employers must use E-Verify since 2012.
States with Voluntary E-Verify Participation
These states do not require E-Verify: Alaska, Arkansas, California, Connecticut, Colorado*, Delaware, Hawaii, Illinois, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Ohio, Oregon, Rhode Island, South Dakota, Vermont, Washington, Wisconsin, Wyoming.
* Colorado had an E-Verify mandate for several years but it was repealed in 2016.
Think you’re in the clear? Hold your horses. Some cities have their own E-Verify mandates (sigh, we know). Always work with legal counsel to determine what local requirements you might need to follow.
Penalties for Non-Compliance
Non-compliance with E-Verify mandates can result in significant penalties, varying by state and the nature of the violation. We alluded to some of these above, but in general, you can expect penalties like:
- Loss of Business Licenses: In states like Arizona and South Carolina, failing to comply with E-Verify requirements can result in the suspension of your business license.
- Fines and Penalties: States including Pennsylvania can impose fines ranging from $250 to $1,000 per violation for contractors that fail to use E-Verify as required by law.
- Contract Termination: For public contractors, failing to use E-Verify can result in contract termination and a ban from future contracts, as seen in states like Florida and Missouri.
- Civil Fines: In states like North Carolina, non-compliance can lead to civil penalties exceeding $10,000 for each infraction.
E-Verify Misuse and State Limitations
While E-Verify is designed to verify employment eligibility, it can be misused. Some states have taken steps to address this and ensure that companies don't use E-Verify in ways that infringe on individuals’ rights and privacy.
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State Use Restrictions and Protections
- California: California has specific restrictions that limit how employers can use E-Verify. For example, state law prevents employers from using E-Verify on existing employees or using it to discriminate against job applicants based on national origin. Violating these restrictions can result in fines of up to $10,000 per case.
- Illinois: Illinois requires employers to notify employees when they are being checked in the system. It also strictly forbids businesses from using E-Verify as a pre-screening tool for recruitment.
Tips for Tracking E-Verify Rules
As with part of HR compliance, understanding (and following changes to) the national patchwork of E-Verify requirements can be challenging. Consider the below tips:
- Stay updated on state regulations: Check state government websites regularly for updates on E-Verify laws, as these requirements can change with new legislation. Assume that this year’s rules won't be next year’s. Sounds paranoid, but that's generally true of labor laws.
- Consult legal experts: This, this, this. If you're a multi-state employer you need to be working with legal counsel, period. Working with an HR compliance consultant or legal advisor can help navigate varying state and city laws.
- Utilize online resources: The E-Verify homepage provides comprehensive maps and guides for state-specific E-Verify obligations. While we appreciate your trust and readership, government-run sites are you best bet for the latest rules.
How Using an HRIS Makes E-Verify Compliance Easier
A human resource information system (HRIS) can be a powerful tool for managing E-Verify requirements. Here’s how systems like Lattice HRIS can make compliance easier:
- Automated E-Verify Integration: Some HRIS platforms (including ours) integrate directly with E-Verify, allowing for automated submission of Form I-9 data, which reduces manual errors and speeds up the verification process.
- Centralized Record Keeping: An HRIS can store completed Form I-9s, E-Verify records, and other documentation, making it easy to retrieve information during audits or compliance checks
- Compliance Reminders: HRIS systems can send reminders when follow-up actions are needed (for example, if an E-Verify case comes back with issues). This also makes it easier for employers to meet compliance deadlines.
Additional HR Considerations
Beyond using an HRIS, there are other best practices to consider for smooth E-Verify implementation:
- Train your team: Proper training is one of the surest guards again common, costly mistakes — like using E-Verify as a pre-screening tool or failing to let employees know that you’re using it. Keep in mind that E-Verify’s official website features educational content geared toward employees and employers.
- Prepare for audits: It’s no fun to think about, but audits by the Department of Homeland Security (DHS) do happen. Keeping detailed records of all E-Verify activity, including Form I-9 submissions and E-Verify confirmation notices, is a must. An HRIS can help organize these records and make them easily accessible, reducing the risk of penalties.
- Communicate clearly with employees: Informing new employees about the E-Verify process is essential to reducing anxiety and confusion. Employees should understand why E-Verify is being used and what to expect if their case comes back with a non-confirmation result. Open communication can help maintain a positive onboarding experience and ensure that employees are aware of their rights during the verification process. USCIS also provides employers with this useful explainer/workplace poster.
- Stay proactive about legal changes: “Change is the only constant” might be an overused and cringe-inducing phrase, but it truly does apply here. E-Verify requirements can change at the drop of a hat. Employers should regularly review updates from state labor departments to stay current on E-Verify requirements. Subscribing to newsletters from trusted labor law firms or working with an HR compliance expert can help you stay ahead of changes and avoid unintentional non-compliance. It also helps to lean on your community of HR peers.
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E-Verify isn’t going anywhere, and the legal landscape is unlikely to get any easier to navigate. That’s especially true for multi-state employers. The good news is that E-Verify doesn’t have to be an administrative burden for HR teams or their employees.
If you’re a current Lattice customer, visit our Help Center to learn how to configure your E-Verify integration. If you’re new to Lattice (Howdy 👋) and want to learn more about our integration and how our technology makes onboarding a breeze, schedule a demo of our platform.
The information provided in this article is for general informational purposes only and does not constitute legal advice.
Key Takeaways ✨
- E-Verify is a federal system that verifies employee work eligibility by cross-referencing the Form I-9 with government records.
- Federal contractors must use E-Verify, while city and state-specific mandates vary.
- Some states require it for all employers and others only for state contractors and subcontractors.
- Non-compliance can lead to fines and a revoked business license.
- Some HRIS platforms integrate directly with E-Verify, making it easier to track onboarding progress within a single tool.
🚩 Remember: E-Verify should only be used after the employee has been hired and completes Form I-9. Using E-Verify to pre-screen job applicants is a big compliance no-no — it’s against federal rules (and sometimes state rules) and can lead to potential discrimination claims.
