Effective October 1, 2012, Colorado’s Employment Verification Law requires employers to use the Colorado Department of Labor and Employment’s verification form establishing that an appropriate inquiry was done into the legal status of all newly hired employees. This law requires employers to not only obtain and retain copies of the federally mandated I-9 documentation, but also requires Colorado employers to complete a verification form affirming that the employer has examined the legal status of all newly-hired employee; has retained the federally required documents; has not altered or falsified the employee’s identification documents; and has not knowingly hired an unauthorized alien. The affirmation form must be completed within 20 days of hire. A written copy of the form must be retained along with the I-9 documentation for the term of employment of each employee. A copy of the newly required affirmation form can be obtained on the Department’s website (www.colorado.gov/cdle).
While the requirement for use of a particular form may not be of incredible significance in and of itself, it gains importance given what appears to be the Department’s recent increased use of random compliance audits. Typically, the compliance issue comes up as part of a broader investigation stemming from a complaint regarding the alleged hiring of illegal aliens. However, the Department seems to have moved to a more aggressive approach through use of the random audits that require the selected employer to show that they are in fact in compliance with the law. Receipt of a notice of random audit must be taken seriously in light of the fact that the verification law provides that the penalty for violation may be the imposition of fines up to $5,000 for a first offense and up to $25,000 for the second and any subsequent offense. It is important for employers to recognize that an offense under the verification law is committed NOT by hiring an illegal alien, but rather by failing to complete the required verification form and/or failing to keep a copy of the form and/or the I-9 documents.
When faced with a random audit, the law requires that the employer submit the documentation requested by the Department demonstrating compliance. The typical audit seeks the following: 1) A list of all current employees, with dates of hire; 2) The total number of employees on the payroll as of the date of the audit notice; 3) A copy of the Colorado verification form for each employee hired on or after January 1, 2007 and currently employed; 4) Legible copies of the identity and employment authorization documents required under federal law (i.e. the I-9 documents) for each employee hired on or after January 1, 2007; and 5) The name, title and contact information of the person responsible for responding to the audit.
Employers are strongly advised against trying to create and complete verification forms after the fact in response to the audit. Since the law requires that the forms be completed 20 days after hire, completing the forms following receipt of the audit notice not only fails to rectify the non-compliance with the law, it may be looked at as an attempt to defraud the Department into believing compliance occurred. Similarly, and for the same reasons, Employers should not attempt to gather I-9 documents from existing employees following receipt of an audit notice. Rather, if the employer finds itself out of compliance when it receives the audit notice, it should consult with legal counsel and prepare a written explanation of the non-compliance. Assuming that the non-compliance was not willful or reckless and did not result in the hiring of illegal aliens, the odds are good that the employer will be given a chance to commit to compliance going forward and perhaps receive nothing more than a warning.