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Case Study: Company Hit with Largest I-9 Penalties to Date

August 10 - Posted at 3:02 PM Tagged: , , , , , , ,

Failure to thoroughly complete I-9 paperwork has left an event-planning company with a fine of $605,250 (the largest amount ever ordered) serving as a reminder that employers need to be taking I-9 compliance very seriously.


On July 8, 2015, the Office of the Chief Administrative Hearing Officer (OCAHO), which has jurisdiction to review civil penalties for I-9 violations, ordered Hartmann Studios to pay the fine for more than 800 I-9 paperwork violations.


Immigration and Customs Enforcement (ICE) audited the company in March 2011.


The bulk of the violations charged against Hartmann were due to a repeated failure to sign section 2 of the I-9 form. Employers are required to complete and sign section 2 within three business days of a hire, attesting under penalty of perjury that the appropriate verification and employment authorization documents have been reviewed.

ICE found 797 I-9s where section 2 was incomplete. About half of these incomplete forms related to individuals from the International Alliance of Theatrical Stage Employees Union Local 16A, who worked for Hartmann on a project-by-project basis during the term of a collective bargaining agreement. Even though the union workers worked on a project-by-project basis, they were not terminated upon completion of a project and remained “on-call.” The union created a “three-in-one” form that combined a portion of a W-4 form, parts of sections 1 and 2 of an I-9 form, and a withholding authorization for union dues. No separate I-9 form was completed for these workers nor did Hartmann sign section 2 of the union form.


Hartmann could have been charged with the more-substantive offense of having failed to prepare any I-9 form at all for the 399 union members, because the union’s form is not compliant, but OCAHO declined to do so.


Hartmann told OCAHO it believed that the union form was sufficient to confirm that the workers had proper employment authorization, and that nothing further needed to be done to confirm their eligibility for employment. The company also said that it did not know signing section 2 of the form was a legal requirement. 


In addition to failing to sign section 2, Hartmann was also cited for:

  • Failure to fill out any I-9 form at all for four individuals.
  • Failure to locate the I-9 forms for eight individuals at the time of the     inspection.
  • Failure to ensure that three workers checked a box in section 1 indicating immigration status.
  • Failure to ensure that two workers signed section 1.
  • Failure to ensure that two workers entered their alien numbers on the form.
  • Missing List A, B and C documents.


This case demonstrates the need for employers to conduct routine self-audits of their I-9 inventories to ensure that the forms have been properly completed and retained and are ready for inspection.


Employers should also ensure that acceptable proof of audits and training is kept so that it may be used as evidence of good faith in court proceedings.

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