Businesses and organizations today are faced with a tremendous amount of risk, as local, state, and federal laws demand compliance on an ever-evolving spectrum of regulations. Even small errors, on something like an I-9 form, can have haunting effects on a business’ financial wellbeing.
HR professionals are tasked with the responsibility of not only knowing regulations, but also with keeping up with their changes. And most importantly, they have the responsibility of making sure that compliance processes are in place, and that risk is mitigated, in order to avoid substantial fines and lawsuits.
It’s a spooky world out there, and here are some compliance stats that might keep some HR pros up at night, howling at the moon.
Fines for Non-Compliance in Workplace Safety and Health Standards (OSHA)
- New penalties for willful and repeat violations: $129,336 per violation
- Serious, other-than-serious, and posting requirements: $12,934 per violation
- Failure to correct violations: $12,934 for each day the condition continues.
The largest fines in history due to non-compliance are down-right frightening! (TeleMessage)
- New York-Presbyterian Hospital and Columbia University – $4.8 Million
- Advocate Health Care (AHC) – $5.5 Million
- Rio Tinto – $35.6 million
- Deutsche Bank – $203.83 Million
- Citigroup – $285 Million
- Goldman Sachs – $550 Million
- Google – $2.7 Billion
ICE agents or auditors conduct inspections of Forms I-9 for compliance. When technical or procedural violations are found, an employer is given ten business days to make corrections. An employer may receive a monetary fine for all substantive and uncorrected technical violations. Employers determined to have knowingly hired or continued to employ unauthorized workers will be required to cease the unlawful activity, may be fined, and in certain situations may be criminally prosecuted.
Monetary penalties for knowingly hire and continuing to employ violations range from $375 to $16,000 per violation, with repeat offenders receiving penalties, at the higher end. Penalties for substantive violations, which includes failing to produce a Form I-9, range from $110 to $1,100 per violation.
I-9 Form Knowing Hire / Continuing to Employ Fine Schedule: (ICE)
- 1st Time Violator: $548-$4,384 (per violation)
- 2nd Time Violator: $4,384- $10,957 (per violation)
- 3rd Time Violator: $6,575-$21,916 (per violation)
Errors on Form I-9s, such as failure to check a box or enter a date, can now result in a monetary penalty between $224 and $2,236 per violation
I-9 Substantive / Uncorrected Technical Violation Fine Schedule
- 1st Offense: $224 – $2,236 (per violation)
- 2nd Offense: $224 – $2,236 (per violation)
- 3rd Offense: $224 – $2,236 (per violation)
- Hartmann Studios, an events-planning company, was ordered to pay a fine of $605,250 for more than 800 I-9 paperwork violations.
- Pennsylvania-based Asplundh Tree Experts, Co. was ordered to pay a whopping $95 million to settle both criminal and civil immigration charges stemming from the company’s hiring and rehiring of undocumented workers over a six-year period. The $95 million price tag (which includes an $80 million criminal forfeiture money judgment and $15 million in civil payment), represents the largest payment levied in an immigration or Form I-9 investigation to date.
There’s a dangerous tendency in the world of HR compliance to dismiss or perhaps simply ignore Form I-9 responsibilities based upon the mistaken belief that investigations only happen to employers who flagrantly hire or employ undocumented workers. When you consider a $2.7 billion fine to Google, you can think that compliance will only be checked on the “big companies,” but this simply is not true.
Many employers learn the hard way that ICE can still penalize you for simple “paperwork” violations (which can now be as high as $2,236 per form), just because you failed to follow the established process for ensuring you have a legal workforce.
Family and Medical Leave Act (FMLA)
- In Bissonnette v. Highland Park Market Inc., an IT employee was awarded nearly $103,000 plus 100% liquidated damages, attorney’s fees and prejudgment interest for violations of the federal Family and Medical Leave Act (“FMLA”). The total cost to the employer was $536,000.
- A hospital employee was fired when she took leave to care for her two sick children. After being found liable, the hospital had to pay $58,000 in back pay and benefits.
- A jury awarded an employee, who was fired after requesting leave for depression and anxiety, $19,000 in damages and $80,000 in attorney’s fees.
- Failing to comply with a group health plan requirement may trigger an excise tax of $100 per day with respect to each individual to whom the failure relates in ACA Compliance regulations
- In 2011 a Belleville, IL employee was awarded $95 million in a sexual harassment case because the employer did not handle the complaint correctly.
- A judge awarded a recruiter $8.1 million for sexual harassment, sex discrimination, retaliation, and emotional distress claims against her employer.
Compliance risks run from I-9 forms to FMLA tracking, from ACA compliance to Cobra compliance, to worker safety training to sexual harassment training, and much more. No business can afford to ignore the need for an efficient and consistent compliance process; there’s simply too much at risk. Don’t get tricked into thinking that “they” won’t find you. Be proactive, and make sure that your compliance process is a treat, giving you consistency, efficiency, and the ability to Work. Compliant.
David LaMontagne is the CISO at Essium,a premiere software company that has developed a revolutionary, customizable, workforce management solution named Xenqu. Essium’s Xenqu Software leverages our Smart Content Technology to organize everything related to your workforce in one secure, digital file using the latest cloud-computing technologies and architectures.