How to Conduct An Internal Form I-9 Audit

When conducting your internal I-9 form audit start off by outlining your procedure and how you plan to conduct the audit

For Section Two of the I-9 form you’ll need to ensure one document from List A is included and completed or one document from List B and one from List C are listed and completed

When conducting your internal audit, Section Three of the I-9 form deals with reverification which only applies if evidence of employment authorization (List A or List C document) presented in Section two expires

The best way to correct the Form I-9 is to line through the portions of the form that contain incorrect information (preferably in a contrasting ink color), then enter the correct information, initial and date your correction


Dealing with I-9 Forms can be tricky. It’s definitely not the easiest part of your day, and it requires a lot of attention to detail. No one even wants to talk about the possibility of getting audited for your I-9 forms. But what if I told you it was actually pretty simple? In this blog, I am going to list off the six steps you need to conduct your own internal Form I-9 audit. So if you ever hear ICE (Immigration and Customs Enforcement) knocking on your door, you’ll be ready!

Step One: Outline Your Procedure

When conducting your internal I-9 form audit start off by outlining your procedure and how you plan to conduct the audit. Your internal audit should concentrate on key problems that frequently arise during the completion of the I-9 form.

Conducting the Internal Audit – When preparing to conduct your internal audit be sure you account for the need of the following criteria:

  • Unbiased – Make sure the selection of Forms I-9 for an internal audit is not based on the employee’s race or nation origin. Either audit all forms, or audit a truly random sample of forms. An organization may not selectively choose which forms to audit.
  • Annual – This provides a defense against allegations of targeted internal Form I-9 auditing. Internal audit processes should mimic government compliance audit processes. This not only verifies Forms I-9 on file, but it also trains the Human Resources Department to prepare for actual government compliance audits.
  • Consistent – Either keep copies of all I-9 verification documents, or none of them. If your records are not complete, then you must either obtain the missing documents, or dispose of all collected verification documents.
  • Knowledgeable – Designate an “I-9 Officer” or Company Representative, responsible for knowing and applying Form I-9 rules. The authorized I-9 Officer should achieve the following:
    • Become well-versed on the correct completion of the Form I-9
    • Develop and enforce a compliant program
    • Create and implement internal training procedures
    • Conduct regular internal audits
    • Have a plan of action in the event of an ICE audit

Step Two: Auditing Section One of the I-9 Form

You’ll need to make sure you’re gathering all of the information below to complete step two, auditing Section One of the I-9 form.

Employee Information

  • Employee first and last names completed
  • Maiden name or other names if it is applicable; “N/A” for “Other Names Used” if it does not apply
  • Full address fields completed – No PO boxes allowed
  • Date of birth in mm/dd/yyyy format
  • Social Security Number (optional); Social Security Number mandatory for
  • E-Verify participants

Citizenship/Immigration Status

  • Status is selected (not more than one)
  • Lawful Permanent Resident – including alien registration number
  • If employee is not a permanent resident but has authorization to work in the United States, the alien number or admission number must be included and correctly stated
  • Expiration date of employment authorization is included and correctly stated

Employee Attestation

  • Employee’s signature
  • Date of employee’s execution of form
  • Form I-9 signed on the first day of employment or the period between the job being accepted by the employee and the first day of employment
  • Preparer/Translator Certification
  • Signature of preparer/translator if applicable
  • Name of preparer/translator correctly stated
  • Address of preparer/translator correctly stated

Step Three: Auditing Section Two of the I-9 Form

For Section Two of the I-9 form you’ll need to ensure one document from List A is included and completed or one document from List B and one from List C are listed and completed.

List A (Identity and Employment Authorization)

  • Appropriate document listed
  • List A document title correctly stated
  • List A document issuing authority correctly stated
  • List A document number correctly stated
  • List A document expiration date, if applicable, correctly stated
  • Receipt showing application for document accepted; awaiting original to be presented within 90 days

List B (Identity)

  • List B document title correctly stated
  • List B document issuing authority correctly stated
  • List B document number correctly stated
  • List B document expiration date, if applicable, correctly stated
  • Receipt showing application for document accepted; awaiting original to be presented within 90 days

List C (Employment Authorization)

  • Employee’s first day of employment correctly stated (mm/dd/yyyy)
  • Signature of Employer/Authorized Representative present and in correct box
  • Date of certification correctly stated (mm/dd/yyyy)
  • Certification signed by the third business day after the hire date
  • Title of Authorized Representative correctly stated
  • Last Name and First Name of Authorized Representative correctly stated
  • Employer’s Business or Organization Name correctly stated
  • Address of business correctly stated – No PO boxes allowed

Step Four: Auditing Section Three of the I-9 Form

When conducting your internal audit, Section Three of the I-9 form deals with reverification which only applies if evidence of employment authorization (List A or List C document) presented in Section two expires. Step four also covers what to do if you’re missing any I-9 forms.

  • Do not reverify: US Citizens and Noncitizen Nationals, or Lawful Permanent
  • Residents (I-551)
  • If employee listed an expiration date in Section 1, employment eligibility
  • reverified on or before expiration date
  • Date of rehire, if applicable (mm/dd/yyyy)
  • New name listed, if applicable
  • Document title correctly stated
  • Document number correctly stated
  • Employment authorization document expiration date (mm/dd/yyyy)
  • Signature of Authorized Representative present and correctly placed
  • Date of company certification (mm/dd/yyyy)
  • Printed name of Authorized Representative

Missing Forms I-9

For current employees – require employee to present documentation and complete a new Form I-9 with current dates. Date of hire will be the employee’s actual date of hire, which may have been years earlier. Attach a memo to the Form I-9 explaining the discrepancy between the date of hire and the date of completion of the Form I-9. Sign and date the memo.

For former employees – date and attach a memo to Forms I-9 for any terminated employees with missing or incorrect Form I-9 information. Retain it with other Forms I-9. Documenting this demonstrates an employer’s good faith effort to correct the forms by performing an internal self-audit.

Step Five: Addressing Form I-9 with Errors

Errors are bound to happen. Especially when you’re dealing with I-9 forms. But here’s what you do to ensure you keep on trucking!

Easily correctable – you may do so on the form. The best way to correct the Form I-9 is to line through the portions of the form that contain incorrect information (preferably in a contrasting ink color), then enter the correct information. Initial and date your correction. Never use white correction fluid. If you have previously made changes on Forms I-9 using white correction fluid instead, USCIS recommends that you attach a note to the corrected Forms I-9 explaining what happened. Be sure to sign and date the note.

Not easily correctable – complete a new Form I-9.

The old Form I-9 is attached to the new one, along with a note explaining the reason for creating a new Form I-9. Do not throw away the old form.

Step Six: Administrative Wrap Up

You’ve just completed conducting your internal I-9 Form! But you’re not completely done, yet. There are still a few administrative things you’ll need to wrap up.

Photocopies of List 2 documents – if they exist, are attached to the Form I-9 and are readable. It is not mandatory to make photocopies (except in Colorado), but if they are made, they must be kept. If photocopies are made for one employee, they must be made for all employees.

Employers enrolled in E-Verify must keep copies of the following documents if they are presented by the employee – US Passport or Passport Card, Permanent Resident Card (I-551), or Employment Authorization Card (I-766).

Manual Audit Log – The list of the Forms I-9 containing errors is completed. (This is the audit log that shows you have made a good faith effort to ensure Form I-9 compliance. The log should contain three columns: employee’s name, the errors, and the actions taken to rectify the errors.)

Why You Need To Do This, Right Now

Now you’re on your way to conducting a flawless Form I-9 internal audit. But why was this so important? Recently there has been an increase in enforcement for Form I-9 audits for employers. So what exactly changed?

On January 10, 2018, early morning reports of raids by Immigration and Customs Enforcement (ICE) confirmed what had been assumed – worksite enforcement has been increased and employers need to take note. The continued reports of high-profile ICE raids are definitely intentional. ICE wants employers to know that they’ve increased enforcement and they want you to take this very seriously. The current administration also appears to be building upon successful tactics that were used during both the Bush and Obama eras by focusing on administrative arrests of employees and requests for Forms I-9 through a Notice of Inspection (NOI) to employers. ICE conducted 1,279 audits of I-9 forms in 2016 and that number is expected to rise dramatically under the new enforcement focus.

Sure this can be scary, but knowing how to conduct your own internal I-9 form audits can help. And the word to remember for this process is “thorough.” An internal audit should include an in-depth review of all of an organization’s Forms I-9. Considering the limited resources and time of an organization, a comprehensive review of all I-9 records may not be feasible. In this case, organizations are encouraged to review a significant and fair sample of Forms I-9 to determine where the majority of errors/omissions occur, how to correct these, and how to implement better training and policies to ensure proper completion and compliance moving forward. For more information on self-auditing guidelines see the Department of Justice publication: Guidance for Employers Conducting Internal Employment Eligibility Verification Form I-9 Audits.

Let AZ HR Hub know how we can help your company.

California Supreme Court Ruling Latest Blow to Independent Contractor Model

The California Supreme Court’s ruling in a case exploring how workers should be classified—either as independent contractors or as employees—means California businesses will have a tougher time justifying independent contractor classifications.

The court ruled on April 30 in the appeal of Dynamex Operations West, Inc. v. The Superior Court of Los Angeles County.Dynamex, a package and document delivery company, had classified drivers as contractors instead of employees, meaning the company was relieved of its obligations under California Industrial Welfare Commission wage orders related to the wages, hours, and other working conditions of the drivers.

The court’s ruling significantly toughens the test used to determine whether a worker can be classified as a contractor. The change is expected to have a big impact on gig economy workers.

“The big takeaway is that even if you exercise no control over a worker, and even if that worker has other clients in an independent business, [she is] still an employee if [she] perform[s] work that is part of your usual business,” says Mark Schickman, the editor of California Employment Law Letter and an attorney with Freeland Cooper & Foreman LLPin San Francisco. “I don’t see how driving businesses like Uber or Lyft could designate a driver as anything but an employee.”

Schickman says other businesses also will be affected, such as retail stores hiring gig workers to sell merchandise and law and accountancy firms that hire independent contract lawyers and accountants. “Independent contract arrangements were always tough to justify and now it is even tougher,” he says.

ABC Test

Todd R. Wulffson, an attorney in the Irvine office of Carothers DiSante & Freudenberger LLP, explains that the Dynamex ruling is significant for California employers because it adopts the “ABC test” to make the determination. Previously, the state used a multifactor test focusing on the level of control the hiring entity had over the worker’s performance of the work.

The ABC test presumes a worker is an employee unless the hiring entity proves the following:

(A)       The worker is free from the control and direction of the hirer in connection with the performance of the work, both under the contract for the performance of the work and in fact;

(B)       The worker performs work that is outside the usual course of the hiring entity’s business; and

(C)       The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed for the hiring entity.

“Under this new test, the majority, if not the vast majority, of current independent contractors should be reclassified as employees—particularly people driving in the gig economy,” Wulffson says, adding that if a California employer has more than a few independent contractors, it should conduct an audit—with the assistance of counsel to keep it privileged—to determine liability.

Misclassifying independent contractors is a common class action issue, Wulffson says, “and those are very expensive, time-consuming, and painful lawsuits that are almost never covered by insurance.”

In its decision, the court noted that the ABC test is used in other jurisdictions to determine worker status, but Wulffson says it isn’t very prevalent, “most likely because it is so strict.” Thus, the ruling will be a blow to both businesses and contractors.

“California, unfortunately, has proven yet again that but for the weather, no one would want to start a business here,” Wulffson says.

Impact Beyond California

Wulffson doesn’t expect the ruling to have a major impact beyond California since most states don’t follow California’s example on employment laws. He points out that California is one of just three states with daily overtime, plus the state “has a panoply of employment regulations and laws found almost nowhere else.”

The independent contractor test used at the federal level also differs from California’s new test. Wulffson says the U.S. Department of Labor (DOL) uses the economic reality test, which looks primarily at seven factors focused on the level of control the hiring entity has over the contractor.

Wulffson says the DOL also has focused on misclassification in recent years because of concern that businesses are wrongfully avoiding payroll taxes. “It has not, however, gone anywhere near the ABC test,” he says.

California Employment Law Update

The State of California has been very busy with employment law changes.  See below all of the laws that passed in May with various effective dates.

FEHA and National Origin Discrimination

On May 17, 2018, the California Office of Administrative Law approved the California Fair Employment and Housing Council’s new amendments to the state’s Fair Employment and Housing Act regarding national origin discrimination and employment. The new amendments:

  • Clarify the definitions of national origin and national origin groups.
  • Clarify permissible and prohibited types of employer policies governing English proficiency, accent, and language spoken in the workplace.
  • Clarify permissible and prohibited inquiries regarding immigration status.
  • Detail prohibited forms of harassment in the context of national origin.

The new amendments are effective July 1, 2018.

Read the law

San Francisco Paid Sick Leave Rules

On May 7, 2018, the San Francisco Office of Labor Standards published new rules reinterpreting the city’s Paid Sick Leave Ordinance (PSLO) with the following changes:

  • Setting the standard for coverage as applicable to employees working 56 hours in the city and removing a reference to working in the city “on an occasional basis.”
  • Joint employment terms are defined in relation to PSLO applicability.
  • Verification or documentation disclosure protections for employees are modified by requiring no more than is necessary for an employer to determine if the absence is lawful.
  • The notice requirements are modified to require what is presumptively reasonable for pre-scheduled or foreseeable absences.
  • An employee’s regular rate of pay is calculated according to state law (Cal. Labor Code § 510) where previously the calculation was undefined.
  • The basis of an employee’s exempt status is confirmed; however, the rule provides that if an exempt employee was not provided any other paid leave, and sick leave is taken, then his or her salary continues without deduction for the sick time taken, but the leave balance is reduced.
  • The waiting period requirement was modified for employees who are rehired within one year by permitting their original employment period to apply to its fulfillment.
  • Clarifications as to how the PSLO applies to a unionized workforce and collective-bargaining agreements.
  • Modification of remedy calculations and issue resolution timeframes for noncompliant employers.

The new rules are effective June 7, 2018.

Read the rules

Los Angeles Minimum Wage

The City of Los Angeles released its updated local minimum wage poster. Effective July 1, 2018, and under the city’s minimum wage ordinance, Los Angeles employees must be compensated as follows:

  • $12 per hour for employers with 25 or fewer employees.
  • $13.25 per hour for employers with 26 or more employees.

This notice also provides information about the city’s paid sick leave provisions and must be posted in a conspicuous place at any workplace or jobsite. Violators are subject to penalties.

See the poster

San Leandro Minimum Wage

Effective July 1, 2018, the City of San Leandro’s minimum wage increases to $13 per hour. The city released a new poster reflecting this new rate along with the other rate increases that take effect each July 1st through year 2020.

See the poster

Santa Monica Minimum Wage

The City of Santa Monica released its updated local minimum wage poster. Effective July 1, 2018, and under the city’s minimum wage ordinance, every Santa Monica employee (part time or full time) who works at least two hours in a particular work week within the geographic limits of the city must be paid no less than:

  • $12 per hour for employers with 25 or fewer employees.
  • $13.25 per hour for employers with 26 or more employees.

The city’s hotel worker living wage also increased, as listed in the poster, to $16.10 per hour effective July 1, 2018.

See the poster

San Francisco Minimum Wage

On July 1, 2018, the San Francisco minimum wage will increase to $15 per hour. The city released an updated minimum wage poster reflecting the 2018 rate, which must posted by San Francisco employers at each workplace or jobsite.

See the poster

Redwood City Minimum Wage

On April 10, 2018, Redwood City Mayor Ian Bain signed a city minimum wage ordinance (No. 2443) requiring Redwood City employers to pay the following minimum wages:

  • $13.50 per hour effective January 1, 2019.
  • $15 per hour effective January 1, 2020.

Under the ordinance, learner employees must be paid no less than 85 percent of the applicable minimum wage for the first 160 hours of employment and then must be paid the applicable minimum wage. Additionally, employers may not deduct any tip or gratuity (or credit any tip or gratuity) to offset an employee’s wages.

Beginning on January 1, 2021, and each year thereafter, the city’s minimum wage will increase by an amount corresponding to the prior year’s increase in the cost of living, if applicable. The cost of living increase will be measured by the percentage increase in the Consumer Price Index (CPI) for San Francisco-Oakland-San Jose. The increase will be calculated by using the August-to-August change in CPI; however, a decrease in the CPI will not result in a decrease in the minimum wage.

The ordinance also provides the following:

  • Posting requirements.
  • Retention of payroll records for three years.
  • Retaliation prohibition.
  • Exceptions.
  • Violations, enforcement, and penalties.

The ordinance became effective May 10, 2018.

Read the ordinance

Belmont Minimum Wage

The City of Belmont updated its minimum wage rate official notice to reflect the city’s minimum wage increase to $12.50 (tips not included) per hour for employers who are subject to the Belmont Business License Tax, or who maintain a facility in Belmont, and have an employee who works at least two hours per week in the city.

The rate is effective July 1, 2018.

See the notice

Pasadena Minimum Wage

The City of Pasadena updated its minimum wage rate official notice to reflect the city’s minimum wage increase to $13.25 (in addition to any tips received) per hour for employers with 26 or more employees.

The rate is effective July 1, 2018.

See the notice

Independent Contractors, IWC Wage Order Claims, and the ABC Test

On April 30, 2018, the California Supreme Court filed its decision in Dynamex Operations West, Inc. v. Superior Court regarding the proper classification of workers under the California Industrial Welfare Commission’s (IWC) wage order claims. As opposed to employees, independent contractors are not covered by IWC wage orders.

In Dynamex, the court held that there is a presumption that a worker is an employee, and covered under the IWC wage orders, unless a business (hiring entity) can establish that all of the following factors of the “ABC test” are applicable:

  1. The worker is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of such work and in fact;
  2. The worker performs work that is outside the usual course of the hiring entity’s business; and
  3. The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

If the business can establish that all parts (A, B, and C) of the test are met then the worker is an independent contractor for IWC wage order claim purposes. The court’s ruling in specifically applies to the analysis of the “suffer or permit to work” definition of “employ” contained in the wage orders when evaluating worker status. The court did not address which test is applicable to claims of misclassification under other California statutes, only to claims under the IWC wage orders.

The decision is effective as of April 30, 2018.

Read the decision

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