Employers: Those Form I-9s Can Cost You If You’re Not Staying On Top of Them


By Jennifer Parser

It is a good time to conduct an internal audit of I-9s because inspections and fines have not gone away and a new I-9 edition was published recently. An administrative law judge in the Office of the Chief Administrative Hearing Office fined a staffing company $276,000 in June 2017, reduced from the $367,000 originally imposed by Immigration and Customs Enforcement (ICE). While this is less than the highest fine of $605,250 imposed in 2015 on an events planning company for incomplete I-9s (there were only four missing I-9’s out of 339 employees), the reason for the staffing company’s fine was a failure to produce the I-9s to ICE within the three days of its request. So, Rule No. 1 taken from this latest large ICE fine: Have complete I-9s ready and available for inspection at all times.

Second, use the latest Form I-9. A new I-9 Form went into effect on July 17, 2017. The Jan. 1, 2107 version can be used until Sept. 17, 2017. After that, employers must only use the July 17, 2017 iteration. Rule No. 2: Never rely upon pre-printed I-9 forms. Always go to the website and download the latest version.

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The U.S. Supreme Court Limits Discovery Sanctions to Compensation, Not Punishment

By Neil Bloomfield

It is not every day the U.S. Supreme Court pays attention to matters that affect the practice of discovery, but that day came with Goodyear Tire and Rubber Co. v. Haeger, 137 S.Ct 1178 (April 18, 2017). Writing for a unanimous Court, Justice Kagan explained that when a court exercises its inherent power to sanction bad-faith conduct by ordering a party to pay the other side’s legal fees, the award is limited to the fees that would not have been incurred but for the sanctioned party’s conduct.

The Court’s decision provides useful guidance, but leaves open interesting questions that litigants and district courts will be wrestling with for years to come.

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A Claim By Any Other Name Would Still Be Pre-empted By ERISA

By Joseph S. Murray IV

You and I make a deal: You pay me monthly installments and when an event occurs, I will pay you a set amount of money (we’ll call this deal “life insurance”). After several years, I notify you that you have failed to return a required document, allowing me to void the life insurance. The event occurs and I refuse to pay. In most circumstances you could potentially make claims against me for negligent misrepresentation or fraud; constructive fraud; and negligent or intentional infliction of emotional distress. But if I were your employer, all of these claims would be preempted by the Employee Retirement Income Security Act (ERISA).

In Prince v. Sears Holdings Corp., No. 16-1075 (4th Cir. Jan. 27, 2017), the 4th Circuit reiterated that regardless of what a plaintiff calls a claim or how the plaintiff frames the claim, if ERISA applies, then ERISA pre-empts that claim. In 2011, Prince purchased a life insurance policy on his wife through his employer, Sears. Sears sent a confirmation letter and began withholding premiums from Prince’s pay. Later that year, Mrs. Prince was diagnosed with cancer. In 2012, Prince checked his benefits summary with Sears, which confirmed the life insurance. In 2013, Sears notified Prince that he had not returned a required document in 2011—Prince denied receiving the document but had no proof it had not been sent—and, therefore, Prince’s insurance would be canceled. Mrs. Prince died in 2014 and Sears denied Prince’s claim on the insurance policy.

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