On June 9, 2008, President Bush issued an amendment to
Executive Order 12989. By this action, all Executive agencies and departments entering into contracts must "verify the employment eligibility of: (i) all persons hired during the contract term by the contractor to perform employment duties within the United States; and (ii) all persons assigned by the contractor to perform work within the United States on the Federal contract."
Also on June 9, 2008, the Department of Homeland Security (DHS) issued a
press release, offering some additional information. First, DHS designated the E-Verify program as the system that all federal contractors must use under amended Executive Order 12989. Second, DHS clarified that, under the Executive Order, the obligation on federal contractors to use E-Verify is a condition on each
future federal contract. Third, DHS stated that the agencies and departments responsible for federal acquisition regulations will send a Notice of Proposed Rulemaking to the Federal Register, soliciting public comment for a 60 day period on proposed changes to the federal contractor/procurement regulations.
What is E-Verify?
E-Verify (formerly known as the “Basic Pilot/Employment Eligibility Verification Program”) is an Internet-based system operated by DHS in partnership with the Social Security Administration (SSA) that allows participating employers to electronically verify the employment eligibility of their newly hired employees. USCIS administers the E-Verify program for DHS. Please
click here for more information on E-Verify.
Who is Impacted by this Executive Order?
This Executive Order impacts all employers entering into future federal contracts with Executive-branch agencies and departments. Pursuant to the Order and the DHS guidance, federal contractors will be obligated to participate in E-Verify and electronically verify the employment eligibility of (1)
all of the employer's new hires (regardless of whether those employees perform work pursuant to the federal contract) and (2) all employees (implying new hires and current employees) who will perform work pursuant to the contract.
A question remains whether the amended Executive Order may require employers to perform an E-Verify on current employees assigned to work on future Federal contracts. As written, the Executive Order does not comport with the terms of DHS’ Memorandum of Understanding governing
E-Verify usage. By signing the Memorandum of Understanding, the employer agrees not to use the E-Verify system to re-verify an existing employee’s status or for existing employees hired before the Memorandum of Understanding was in effect. Therefore, unless DHS modifies the terms of the Memorandum of Understanding to permit such action, as of now it seems impermissible to apply E-Verify to existing employees on future federal contracts. However DHS may include such a provision in the proposed federal regulation to be released soon as per the DHS press release.
When Does the Executive Order Go Into Effect?
The Executive Order and DHS press release are silent as to an effective date to implement the changes. As the President's action is an amendment to an existing 1996 Executive Order, and DHS has clarified that the obligation to perform E-Verify is for future government contracts, in the absence of a government statement on the issue, this could be interpreted to mean that the Executive Order is effective immediately for all new federal contracts. However, as a practical matter, implementing the obligation into future federal contracts likely will take some time. In the DHS press release, DHS states that there will be a notice of proposed rulemaking the Federal Register by agencies responsible for federal acquisition regulations, soliciting public comment to proposed changes to the regulations and that there will be a 60 day comment period. Once these regulations are released, employers may have a better idea of a timeline for implementing the E-Verify requirement into future government contracts.
QUESTIONS
If you are an employer and have questions about this interim rule or about the E-Verify program, please contact any one of the following:
Gregory P. Adams
gregory.adams@dinslaw.com
513.977.8125
Lindsay L. Chichester
lindsay.chichester@dinslaw.com
513.977.8643
Douglas Halpert
douglas.halpert@dinslaw.com
513.977.8181
Susan A. Smith
susan.smith@dinslaw.com
513.977.8471