Homeland Security’s (DHS) free online E-Verify system to
verify the employment eligibility of all new hires and some
current employees, regardless of citizenship.
This requirement applies to federal contracts awarded after
September 8, 2009 that exceed $100,000. The rule also extends the E-Verify requirement to services or construction
with a value over $3,000 for subcontracts that flow from prime
contracts that include the E-Verify clause.
Contractors who win federal contracts containing the FAR E-Verify clause are required to enroll in the E-Verify program
within 30 calendar days of the contract award date. This
requirement also applies to any covered subcontractors on
the project, with the requirement that they enroll within 30
days of being awarded the subcontract.
Contractors must enroll in the E-Verify program at https://e-
verify.uscis.gov/enroll/StartPage.aspx. E-Verify must be used
to confirm that all new hires, whether employed on a federal contract or not – in addition to existing employees working directly
on federal contracts – are legally authorized to work in the U.S.
E-Verify electronically checks the information an employee
provides on his or her I-9 form against records contained in
DHS and Social Security Administration (SSA) databases to
determine employment eligibility. The process of checking
eligibility via E-Verify must begin within three days of a new
employee’s start date.
U.S. Immigration and Customs Enforcement has increased
its focus on auditing I-9 forms, and has shifted resources
and special agents toward pursuing criminal prosecution
of employers who engage in a “pattern of practice” of hiring or employing undocumented workers.6
Each failure to notify the DHS of continued employment following a final non-confirmation of employment eligibility
can result in fines of $500-$1,000. Additional penalties can
include suspension or cancellation of the federal contract
and debarment from future contracts.
The past year has brought significant regulatory changes for
contractors working on federally funded projects. Executive
Orders signed by President Obama, ARRA’s expansion of the
applicability of the Davis-Bacon Act and related acts, and increased focus on compliance – coupled with the President’s
goal of transparency and accountability – means contractors
who work on federal projects are navigating a very complex
Therefore, federal contractors (particularly those new to
public works projects) should consider partnering with an
experienced prevailing wage benefits company to ensure
compliance with this complex web of laws and requirements.
ADAMBONSKY is the Executive Vice President of
Government Markets for the Fringe Benefit Group in
Austin, TX, which has been helping the construction industry and related associations design and administer fringe
benefit programs since 1983.
Adam has nearly 20 years’ experience in financial services, employee benefits, and insurance. He previously
held executive level positions with Gevity, Union Bank of
California, and Transamerica Retirement Services.
Adam received his BA from Harvard University.
1. U.S. Census Bureau News Release, December 1, 2009. “October 2009
Construction at $910.8 Billion Annual Rate.” www.census.gov/const/
5. USCIS E-Verify – Information for Federal Contractors. www.uscis.gov/
6. ICE News Release, July 1, 2009. “ICE launches initiative to step-up
audits of businesses’ employment records.” www.faegre.com/webfiles/
Previous Articles on ARRA
“The 2009 Economic Stimulus Act:
What It Could Mean to You”
“Ethical Reform For Federal Contractors”
“Impact of the New Administration/Congress
on Taxation & Planning for Contractors”