January 11th, 2019 •
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E-Verify: Who It Applies To, and What Happens During the Government Shutdown
This article discusses which employers must use E-Verify, and then, what employers should do to verify employment status during the current government shutdown.
As of January 1, 2017, private employers with 50 or more employees under the same Federal Employer Identification Number (FEIN) are required to use the federal E-Verify employment verification process on all new employees. (Note that this applies to employees working in or outside of the state of Tennessee.) This is part of the Tennessee Lawful Employment Act (TLEA), which has been implemented piecemeal.
Under the old version of the law, private employers had to choose a verification process before their new hires could begin work. The verification process options included (1) using E-Verify, or (2) requesting and maintaining copies of identity and work authorization documents pursuant to the federal I-9 process. However, since January 1, 2017, employers with more than 50 employees must use E-Verify on all new employees. The statute provides that “such employers shall only be required to use the E-Verify program to verify the work authorization status of employees hired on or after January 1, 2017.”
Additionally, the TLEA applies to employees and non-employees. A non-employee is an individual not directly employed by the employer, but paid directly by the employer for labor or services, such as an independent contractor. Companies in Tennessee are required to request and maintain copies of certain identity and work authorization documents for non-employees, unless an exception applies (i.e. workers are employed by a separate company). However, note that employers may not use E-Verify on non-employees.
The TLEA penalizes employers who violate its provisions. These fines range from $500 as a company penalty plus $500 for each employee the employer failed to verify, up to $2,500 as a company penalty plus $2,500 for each employee the employer failed to verify. There is also a $500 penalty for failing to enroll in E-Verify and a $500 per day penalty for failing to timely produce evidence of compliance within 45 days of a final order of violation.
It is important to remember that employers cannot use E-Verify retroactively. Therefore, employers should run new hires through E-Verify, but not ones who already work there.
So what should employers do during the federal government shutdown? The Department of Homeland Security announced that E-Verify is not available during the shutdown due to lack of funding. The three-day rule for creating cases has been suspended. The time period during which employees can resolve tentative non-confirmations (TNCs) will be extended, and the number of days the program is shut down will not count toward the employee’s time to resolve the issue. Once the shutdown ends, DHS will provide further guidance on these types of issues.
All employers are warned not to take any adverse action against an applicant or employee while E-Verify is shut down. Federal contractors could face different requirements and should contact their Contracting Officer to inquire about other deadlines and requirements.
PRACTICE POINTER: Employers must still verify employment eligibility using Form I-9 no later than the third business day after the employee begins working for pay. Employers should comply with all I-9 requirements until DHS offers its promised guidance once operations resume.
NLRB Issues New Guidance on Workplace Policy Dos and Don’ts Post-Boeing
In The Boeing Company, 365 NLRB No. 154 (Dec. 14, 2017), the National Labor Relations Board (NLRB) set a new standard for determining whether workplace policies were lawful under the National Labor Relations Act (NLRA). Instead of whether a workplace policy could interfere with an employee’s rights under the NLRA, the NLRB now looks at whether a policy would do so. This is a more employer-friendly standard.
The NLRB will now apply a balancing test to make its determination, considering (1) the nature and extent of the potential impact on employee rights; and (2) the legitimate justifications for the employer having such a policy. In addition, the NLRB also established categories that all workplace policies fall into, based upon the results of its balancing test. Category 1workplace policies are lawful because they do not restrict rights under the NLRA, or because the justifications for the policy outweighs the tendency to restrict an employee’s rights. Category 2 workplace policies will attract slightly more scrutiny into whether they prohibit or interfere with employee rights, and if so, whether the impact is outweighed by other, legitimate considerations. Category 3 workplace policies are those that are unlawful because they restrict rights protected by the NLRA without sufficient legitimate justification.
The NLRB’s new Memorandum offers guidance on how it will categorize certain workplace policies. The examples offered by the NLRB are perhaps the most helpful portion of the Memorandum. Policies that would likely fall within Category 1 include policies related to insubordination, disruptive behavior, restricting use of company logos, and protection of confidential information. On the other end of the spectrum, Category 3 includes policies related to those restricting discussion of wages or benefits, working conditions, or joining outside organizations.
PRACTICE POINTER:Although helpful to employers, the new NLRB guidance is not comprehensive, and employers should still carefully consider certain workplace policies using the balancing test noted above. For policies which may more heavily impact employees’ individual rights, it is always advisable to have an attorney review whether the policy makes the employer a target for the NLRB.
Tennessee Court of Appeals Releases Opinion in Favor of Employer on Retaliatory Discharge and Jury Trial Issues
The Tennessee Court of Appeals recently released an opinion in a retaliatory discharge case. The employee claimed that her employer fired her for participating in an investigation of misconduct by her supervisor. Her employer argued that her participation in the investigation had nothing to do with her termination; instead, she was terminated for poor performance, despite numerous documented counseling sessions. The trial court and the Court of Appeals both sided with the employer.
This case presented a unique legal issue: whether the employee was entitled to have a trial by jury for her Tennessee Human Rights Act claim in Circuit Court, or whether she had to present her case to a judge. The trial court and Court of Appeals agreed with the employer that the employee was not entitled to a jury trial. Having the case as a non-jury trial was important for the employer because statistics and research show that in many cases employers tend to fare better without a jury.
Rainey Kizer employment attorneys handled this case on behalf of the employer.
PRACTICE POINTER: The employer in this case did many things right, leading to its victory. First, it handled the investigation of the supervisor with confidentiality, which limited circulation of who participated. This made it more difficult for the employee to claim that the person who terminated her knew about her participation. Workplace investigations should be kept on a “need-to-know” basis in order to protect those who cooperate in the process and to limit those who can claim retaliation from participating.
Also, the employer’s counseling of the employee and its documentation of that counseling was key. Had the employer made an impulsive reaction and fired Employee at the first sign of performance problems, it would not have been in as good of a position at trial.
Save the Date – Spring Employment Law Conference
Our Spring Employment Law conference, held in conjunction with WTSHRM, is scheduled for Wednesday, May 1, 2019, at Union University in Jackson, Tennessee. Be sure to add this to your calendar for another full day of helpful discussions on the latest Employment law updates.