Final Rule on E-Verify System Published

On November 14, 2008, the Department of Defense, the General Services Administration, and the National Aeronautics and Space Administration published a final rule that requires most Federal contractors to use the E-Verify system in addition to standard I-9 procedures.
Beginning January 15, 2009, the E-Verify clause will be inserted into contracts over $100,000, and agencies will begin amending existing contracts to include the clause. The clause requires most Federal contractors to use E-Verify to verify all current employees working on a federal contract, as well as all new hires, regardless of whether they are assigned to work on a federal contract. Employees working in the 50 states and the District of Columbia, Guam, Puerto Rico, and the U.S. Virgin Islands are covered. However, certain contractors such as: higher education institutions, state or local governments, Indian tribes, or surety working under a takeover agreement, are only required to use E-Verify to confirm the status of existing employees and new hires assigned to a contract, as opposed to all new hires.
There are four requirements under the new regulation:
  • The contractor must enroll in E-Verify as a federal contractor.
  • Within 90 days of enrollment, all new hires working in the U.S. and its territories must be verified through the E-Verify system within three working days of hire.
  • Within 90 days of enrollment, or 30 days of assignment to the contract, all employees currently working on contracts through the online system must be verified. Those employees hired before November 6, 1986, or working in support, indirect, or overhead positions not related to a contract are excluded.
  • Employers must require their subcontractors with contracts of $3,000 or more to use the E-Verify system by including a clause in all service/supply or construction subcontracts. Exceptions to this requirement include: “under which all work will be performed outside of the United States, lasting for less than 120 days, or for commercially available off-the-shelf items.”
Some contractors may be unable to distinguish between employees directly assigned to a contract with the E-Verify provision, and those working on other contracts or in support positions. In this case, there is an option available to verify the employment eligibility of all current employees, not just those assigned to a contract. These verifications must be complete within 180 days of enrollment and do not apply to individuals with a current security clearance.  
Berkshire recommends the following steps to comply with this new requirement:
  1. Notify the contracts department of the new regulation, and determine when a contract is awarded or amended that contains the new E-Verify clause
  2. Decide if it is possible to distinguish between employees directly working on contracts and begin the process to identify those employees who will be input into the system
If the organization is already registered on E-Verify, the status should be updated to reflect the federal contractor. If not already set up on E-Verify, begin the process to do so and register by January 15, 2009. In either case, internal processes should be developed to support use of the system (in addition to the current paper based I-9 system) beginning early next year. To register, update contractor status, sign up for upcoming two-hour informational sessions, download a user’s manual, or more general information, please go to www.dhs.gov/everify. 
Berkshire consultants are also available to assist in your transition and in developing processes, and will monitor any developments regarding this new requirement. Please contact us at 800.882.8904 or bai@berskhireassociates.com for further information.