E-Verify in the Construction Industry

Recently, Pennsylvania passed the Construction Industry Employee Verification Act (The Act). The Act will require all construction-industry employers, both public and private, to use E-Verify to determine the eligibility of new employees to work in the United States. Below is some additional information on The Act.

Who must use E-Verify?

Under The Act, the term construction industry is defined as “anyone engaged in the erection, reconstruction, demolition, alteration, modification, custom fabrication, building, assembling, site preparation, and repair work or maintenance done on any real property or premises under a contract, whether or not the work is for a public body or paid for from public funds”. A construction industry employer would be any individual, entity or organization that conducts business in the state of Pennsylvania and employs at least one employee in Pennsylvania. While most would understand that this would cover general contractors and sub-contractors, The Act is also applicable to staffing agencies that supply workers in the construction industry.

What is E-Verify?

E-Verify is a web-based system to confirm the eligibility of newly hired employees to work in the United States. E-Verify employers verify the identity and employment eligibility of newly hired employees by electronically matching information provided by employees on the Form I-9 against records available to Social Security Administration (SSA) and Department of Homeland Security (DHS).

When will E-Verify be required?

The Act will take effect October 6, 2020; however, E-Verify is a voluntary program and companies may begin using the website to verify employment eligibility immediately.

Why use E-Verify?

Supporters and advocates for The Act say that it will help save Pennsylvania jobs by requiring an additional level of employment verification and penalize those contractors that hire and use illegal workers to obtain an advantage by paying illegal workers a lower rate than required by law.
Also, there are penalties that can be taken against companies that are non-compliant with The Act. If employers are found to be non-compliant with The Act, the following steps could be taken:

  • Immediate termination of employee found to be non-compliant
  • Audit by the Pennsylvania Department of Labor & Industry
  • Additional quarterly reporting to the state
  • Loss of business license

How to Comply with E-Verify?

Employers can go to the E-Verify website to enroll in the program. Information is taken from the employee’s I-9 and entered into E-Verify. It is important to understand that using E-Verify is not a substitute for completing I-9’s during the hiring process, but rather a complement. The employer will receive a response almost instantaneously. This response will either confirm the employee’s eligibility to work or indicate that additional information may be required to verify the employee’s eligibility to work. It could take a few days or a few weeks for the website to confirm an employee’s eligibility to work. It is important that a company not take action and terminate an employee if the initial inquiry requires more time to look into the matter. A company should only terminate an employee if the results of E-Verify are returned that the employee is unauthorized to work in the US.

Our recommendation to all construction employers is to start work with your Human Resources Department now to understand The Act and develop new processes to comply with The Act. Please reach out to a member of the Walz Group with any questions you may have as you work on creating your company’s policy.

Contact us at contactwg@walzgroupcpa.com or  717.392.8200