E-Verify Explained: How to Ensure I-9 Compliance for All Employees

Why E-Verify I-9 Compliance Matters for Every Employer

E-Verify I-9 compliance is the foundation of legal hiring in the United States, yet many employers struggle with the complex requirements. Every U.S. employer must complete Form I-9 for each new hire, while certain employers, like federal contractors, must also use the E-Verify system to electronically confirm work authorization.

Quick E-Verify I-9 Compliance Overview:

• Form I-9: Required for ALL employees, completed within 3 business days of hire
• E-Verify: Required for federal contractors and some state employers, voluntary for others
• Key Deadlines: Section 1 by first day of work, Section 2 within 3 business days
• Penalties: Range from $110 to $28,619 per violation in 2025
• Record Retention: 3 years from hire OR 1 year after termination (whichever is longer)

The stakes are high. Immigration and Customs Enforcement (ICE) considers factors like business size and good faith effort when determining penalties. Fines for knowingly hiring unauthorized workers can reach $16,000 per violation, while paperwork errors can cost over $1,000 per form.

The challenge isn’t just avoiding penalties, it’s creating a systematic approach that protects your business and respects employee rights. Many HR managers are overwhelmed by the rules for document examination, E-Verify cases, and Tentative Nonconfirmation (TNC) procedures.

Fortunately, with the right knowledge and systems, E-Verify I-9 compliance is manageable. This guide will walk you through every step, from completing Form I-9 to handling E-Verify results and avoiding costly violations.

Form I-9 vs. E-Verify: What’s the Difference?

The terms Form I-9 and E-Verify are often confused, but they have distinct roles in E-Verify I-9 compliance. They work together, but one is a foundational requirement and the other is an electronic confirmation tool.

Form I-9 is your foundation. Every U.S. employer must complete this form for every new hire, regardless of their citizenship status. The Form I-9 documents that you have verified an employee’s identity and work authorization through acceptable documents. The new hire completes Section 1 on or before their first day, and you complete Section 2 within three business days by examining their documents. This has been required since the Immigration Reform and Control Act of 1986.

E-Verify takes things digital. This web-based system, run by U.S. Citizenship and Immigration Services, electronically checks the information from Form I-9 against government databases from the Social Security Administration and Department of Homeland Security.

The key difference is that E-Verify is not required for everyone. Federal contractors and employers in certain states must use it. For others, it’s a voluntary tool that provides extra confidence in hiring.

You cannot use E-Verify without first completing Form I-9, but you can complete Form I-9 without using E-Verify. Understanding this relationship is key to a solid compliance strategy.

For deeper insights into how these systems work together, check out our comprehensive guide on E-Verify and I-9. The government’s official M-274, Handbook for Employers also provides detailed guidance straight from the source.

Mastering the E-Verify I-9 Compliance Process: A Step-by-Step Guide

The hiring process is more manageable when you understand the chronological flow of E-Verify I-9 compliance. Following a systematic approach protects your business and your employees’ rights. These obligations are your roadmap to building a legally compliant workforce. For more on how this fits into your overall strategy, see our guide on Employee Onboarding Compliance.

Step 1: Completing Form I-9 Correctly

Your compliance journey begins with Form I-9. The employee must complete Section 1 on or before their first day of paid work. In this section, they provide personal information and attest to their work authorization status. Accuracy here is critical to avoid issues later.

As the employer, you must complete Section 2 within three business days of the employee’s first day. This involves examining documents that prove both identity and work eligibility. Employees can present one document from List A (proving both) or a combination of one document from List B (identity) and one from List C (work authorization). You cannot specify which documents they must provide from the List of Acceptable Documents.

While traditional examination is in-person, employers enrolled in E-Verify can now use remote document examination via live video. Also, be sure to use the current single-page Form I-9 (edition 08/01/23) to avoid violations. Even small errors like missing dates can lead to fines. If you need help, our I-9 Verification Assistance can provide expert guidance.

Step 2: Enrolling and Using E-Verify

After completing Form I-9, many employers move to E-Verify. It’s mandatory for federal contractors and businesses in certain states, while others use it as a best practice.

The enrollment process involves registering your company and signing a Memorandum of Understanding (MOU) with the Department of Homeland Security. This agreement outlines the rules of the system. After enrolling, you’ll complete a brief tutorial and knowledge test.

Creating an E-Verify case is straightforward. You transfer information from the completed Form I-9 into the system, including the employee’s name, date of birth, and Social Security Number. The SSN is mandatory for E-Verify. If an employee is waiting for their SSN, you must wait to create the case until it’s received.

E-Verify then compares this information against Social Security Administration and Department of Homeland Security databases. Most cases receive an immediate “Employment Authorized” result. Learn more about your obligations in our guide to E-Verify Employer Requirements.

Step 3: Handling E-Verify Results and TNCs

Most E-Verify cases result in an “Employment Authorized” confirmation. You simply record the case number on the Form I-9, and the process is complete.

Occasionally, you may receive a Tentative Nonconfirmation (TNC), which means the information submitted doesn’t match government records. It is a mismatch that needs to be resolved, not a final determination of ineligibility.

When a TNC occurs, you must promptly notify the employee and give them a Further Action Notice, which explains the mismatch and how to resolve it. The golden rule is that you cannot take any adverse action (like termination or reduced hours) against an employee based on a TNC. They have the right to continue working while they address the issue.

The employee can choose to contest the TNC or not. If they contest, they have eight federal government working days to contact the appropriate agency (SSA or DHS). You must provide them with a Referral Date Confirmation showing this deadline.

Most TNCs are resolved quickly, often due to data entry errors or name changes. If an employee doesn’t contest or receives a Final Nonconfirmation, you may then take adverse action, including termination. Following these procedures protects both you and your employees. For more details, see our resource on E-Verify Status Check.

Avoiding Common Pitfalls and Steep Penalties

E-Verify I-9 compliance can feel overwhelming, and even well-meaning employers face serious risks. Most violations, however, are preventable. A single audit can uncover years of mistakes, leading to significant financial penalties. By understanding common pitfalls and taking proactive steps, you can protect your business. Our HR Compliance Assistance team helps employers avoid these scenarios.

Common Mistakes in E-Verify I-9 Compliance

We see the same avoidable mistakes repeatedly.

• Data entry errors: A simple typo in a name or Social Security Number can trigger a Tentative Nonconfirmation (TNC). Always double-check information before submitting.
• Missed deadlines: Section 1 is due by the employee’s first day; Section 2 is due within three business days. Use calendar reminders or automated systems to stay on track.
• Outdated forms: Using an old Form I-9 is a violation. Always download the current version from the USCIS website.
• Document abuse: Telling an employee which documents to provide or rejecting a valid but unfamiliar document is illegal. Employees have the right to choose from the Lists of Acceptable Documents.
• Discrimination: Using E-Verify selectively for certain employees is illegal. If you use E-Verify, you must use it for every new hire consistently.

Auditors look for these types of systematic problems. Regular internal reviews, like an I-9 Self Audit, can help you find and fix vulnerabilities before they become costly.

Understanding Penalties for Non-Compliance

The financial consequences of non-compliance are significant.

ICE divides violations into two main categories. Substantive violations relate to paperwork errors like missing forms, incomplete sections, or unsigned documents. Fines currently range from $110 to $1,100 per form. Across many employees, this adds up quickly.

Knowingly hire violations are far more expensive. If ICE finds you knowingly hired or employed unauthorized workers, penalties range from $375 to $16,000 per violation. The most serious cases can result in fines up to $28,619 per violation in 2025.

ICE considers several factors when setting penalties, including your business size, good faith effort, the seriousness of the violation, whether unauthorized workers were involved, and your history of previous violations.

The “good faith effort” factor is key. Employers who can show they have compliance policies, provide training, and conduct internal audits often receive lower penalties. A documented commitment to following the rules makes a major difference.

Protecting Employee Rights for Full E-Verify I-9 Compliance

E-Verify I-9 compliance is also about creating a fair workplace. Violating anti-discrimination provisions can be more costly than paperwork errors.

If you use E-Verify, you must display Right to Work posters in English and Spanish where employees can see them. These posters explain employee rights and are your first line of defense against discrimination claims.

When a TNC occurs, you must immediately notify the employee and provide a Further Action Notice. You cannot take any adverse action against an employee while they contest a TNC. They have the right to keep working while resolving the issue.

Employee choice is paramount. Workers can present any valid document from the acceptable lists. You cannot demand specific documents or require more than is legally necessary. E-Verify also has strict notification requirements and cannot be used to prescreen applicants; it is only for newly hired employees after they complete Form I-9.

The complete list of employee rights and responsibilities provides detailed guidance for everyone involved.

Staying Current: Recent Updates and Best Practices

The employment verification landscape changes quickly. Staying current with E-Verify I-9 compliance requires ongoing attention. Recent regulatory and system modernizations show that a proactive strategy is essential to avoid scrambling when auditors arrive. For help navigating these changes, our More info about Compliance Management Solutions can keep you ahead of the curve.

Key 2023-2025 Changes to Form I-9 and E-Verify

Recent updates have changed daily operations for many employers.

• The new Form I-9 version (edition 08/01/23) is a streamlined, single-page document that is easier to use. It became mandatory on November 1, 2023, and is valid until May 31, 2027.
• The alternative remote examination procedure, launched on August 1, 2023, is a major development for employers enrolled in E-Verify. It allows you to examine remote employee documents via live video, providing a permanent solution for distributed teams.
• Terminology changes are coming on April 3, 2025. The fourth checkbox in Section 1 will revert to “An alien authorized to work.” E-Verify will update its system and some document descriptions to match.
• TPS and DED updates for various populations have been announced. For example, Venezuelan TPS recipients and Hong Kong residents under DED received extensions to their work authorization. These updates affect reverification deadlines, so staying informed is critical.

For more on how these changes affect you, see our resources on More info about Federal E-Verify Rules.

Best Practices for Ongoing Compliance

Strong E-Verify I-9 compliance relies on creating sustainable systems.

• Internal audits: Conduct regular self-audits to find and correct errors before they become liabilities. Review a representative sample of forms and correct mistakes properly by striking through, initialing, and dating any changes.
• Record retention rules: Keep Forms I-9 for three years after the hire date or one year after termination, whichever is longer. Ensure records are secure and easily retrievable.
• Electronic I-9 solutions: These systems can automate much of the process, preventing errors, sending data to E-Verify, generating TNC letters, and managing reverification reminders.
• Staff training: Ensure everyone involved in hiring understands the latest requirements to prevent errors and protect employee rights.
• Staying informed: Use reliable sources like official USCIS and DHS websites or partner with compliance experts to track changes that affect your business.

These practices create a robust compliance framework that protects your business and streamlines your hiring process. For more guidance, explore our More info about E-Verify Best Practices.

Frequently Asked Questions about E-Verify and I-9 Compliance

We often hear the same thoughtful questions from employers about E-Verify I-9 compliance. Here are the straight answers to the most common concerns.

What information does E-Verify actually check?

E-Verify cross-references the I-9 data you provide with information from two major government databases. First, it checks SSA records to confirm that the employee’s name, date of birth, and Social Security Number match. Next, it contacts DHS records to verify the person’s employment authorization using data from documents like Green Cards or Employment Authorization Documents.

E-Verify focuses only on work eligibility. It does not provide details about an individual’s immigration history beyond confirming their authorization to work in the United States based on the documents presented.

How long do I need to keep Form I-9 records?

The record retention rules are specific. You must keep a completed Form I-9 for three years from the hire date OR one year from termination, whichever date is later.

For example, if an employee hired on March 1, 2024, stays for five years, you must keep their Form I-9 until March 1, 2027 (three years from hire). If they leave after one year, you must keep the form until March 1, 2026 (one year from termination). Proper storage requirements are key, whether paper or electronic, to ensure records are secure and accessible for an audit.

Can I use E-Verify for existing employees?

The answer is generally no, with one major exception. E-Verify is designed for newly hired employees. You cannot decide to run your current workforce through the system after they have already been hired and onboarded.

The exception is for federal contractors whose contracts include the FAR E-Verify clause. In this case, you are required to use E-Verify for all employees assigned to that federal contract, even if they were hired previously. This is a significant responsibility that many contractors overlook.

You also cannot use E-Verify for reverification when an employee’s work authorization expires. This must be handled using Section 3 of Form I-9.

Conclusion: Streamline Your Compliance with Expert Help

Mastering E-Verify I-9 compliance is a complex, ongoing challenge. The regulations evolve, the risk of costly errors is high, and the administrative work can consume hours that are better spent on your core business.

You don’t have to manage this alone. At Valley All States Employer Service, we provide outsourced E-Verify workforce eligibility verification, taking this entire process off your plate.

We handle the expert processing with impartiality and efficiency. Our team minimizes errors, manages complex cases, and reduces the administrative burden on your staff. While you focus on running your business, we ensure your compliance is always current and correct. It’s like having a dedicated compliance team without the overhead.

Your time and peace of mind are priceless. Let us handle the details of employment eligibility verification so you can focus on what you do best.

Ready to simplify your E-Verify and I-9 compliance? Explore our expert E-Verify Services.