Virginia Lawyers Weekly

WASHINGTON — For a third time, the federal government has delayed the implementation of a rule requiring all companies working on federal contracts to electronically check the legal working status of their employees through the Department of Homeland Security’s E-Verify system.

The rule requires any company on a federal contract to use an Internet-based system that checks the names and Social Security numbers of all its workers against Social Security Administration and DHS data.

The system either verifies that the information matches or gives the employer a “tentative non-conformation.” It is up to the employee to resolve any mismatch with Social Security Administration officials. If the mismatch is not resolved and the employee remains with the company, the employer faces losing its federal contracts.

The rule was originally set to go into effect on Jan. 15, but was pushed back by DHS to Feb. 20 due to a lawsuit filed last month by the U.S. Chamber of Commerce and a number of other groups. Another postponement delayed the rule’s implementation until after May 21. The third delay pushes the rule back to at least June 30.

Chamber officials – who still urge the Obama administration to kill the rule entirely – welcomed the delay.

“We are hopeful that they will agree that E-Verify is the wrong solution at the wrong time,” Robin Conrad, executive vice president of the National Chamber Litigation Center (NCLC), said in a statement. “Regardless of the administration’s ultimate decision in the rule, we stand by our lawsuit challenging the legality of the new rule. The executive branch may not make E-Verify use mandatory when Congress clearly said that it must be voluntary.”

Currently, the use of E-Verify is voluntary and applies only to new hires. The lawsuit challenges an Executive Order making E-Verify mandatory for federal contractors with projects exceeding $100,000 and for sub-contractors with projects exceeding $3,000.

The lawsuit, Chamber of Commerce v. Napolitano, is pending in federal court in Maryland.

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