Mark A Ivener, A Law Corporation


As published in BNA DAILY LABOR REPORT, on November 14, 2007, Wednesday

AUTHOR: By Michael R. Triplett

The Social Security Administration will not be sending out no-match letters to employers this year because of the lawsuit challenging the Homeland Security Department’s worksite enforcement regulations, an SSA spokesman told BNA Nov. 13.

The decision not to send out the letters based on 2006 tax year data means SSA is not likely to send out any letters until at least spring of 2008, SSA spokesman Mark Hinkle said. By not sending out the letters and waiting until 2008, Hinkle said SSA will not have issued any employer no-match letters during 2007.

A federal judge in California Oct. 10 granted a preliminary injunction barring SSA from sending out the no-match letters because for the first time the letters were to include language threatening possible immigration law criminal and civil liability for employers that failed to respond to the letters ( 196 DLR AA-1, 10/11/07).

“Because of the lawsuit, we needed to revise letters and it became apparent it was getting too late in the year to send them out,” Hinkle explained Nov. 13, adding that employers and SSA were already gearing up to focus on wage reporting for 2007.

New Rule Triggered Lawsuit.

The lawsuit was triggered by the Bush administration’s Aug. 10 announcement that SSA would be altering how it sends out no-match letters. According to the new rule, SSA would include language in the letter explaining there was possible liability under immigration laws. In addition, SSA planned to include a general letter from DHS explaining the liability as well as describing a “safe harbor provision” meant to protect employers who attempted to comply with the letter ( 155 DLR AA-1, 8/13/07).

Although DHS was not going to have access to the names of employers sent the no-match letters, the new rule would treat the receipt of the letter as evidence that the employer had “constructive knowledge” that an immigration violation was taking place.

The final rule was challenged in the U.S. District Court for the Northern District of California by a coalition of immigrant rights, organized labor, and civil liberties groups led by the AFL-CIO, the American Civil Liberties Union, and the National Immigration Law Center. The U.S. Chamber of Commerce and other business groups later joined the litigation.

SSA had planned to send out no-match letters containing warnings from DHS regarding immigration law liability beginning Sept. 4, even before the final rule was to be implemented. That plan was derailed, however, when Judge Maxine Chesney of the Northern District of California Aug. 31 issued a temporary restraining order preventing the letters from being sent ( 171 DLR A-2, 9/5/07).

After the delay prompted by Chesney’s order and then Judge Charles Breyer’s Oct. 10 grant of a preliminary injunction, Hinkle said that SSA believed it was running out of time to rewrite the notice and expect employers to correct wage data.

Nine Million Employees Checked Each Year.

Each year, the SSA sends letters to some 138,000 employers pointing out discrepancies between data sent to SSA by employers and the information already available in the SSA database. Hinkle said the letters involve as many as 9 million employees each year who may have provided incorrect Social Security data. SSA has sent out the letters since 1994.

The letters are usually sent out in “batches” starting in March or April, Hinkle said, and employers are asked to correct data. Anticipating the final rule from DHS, he said SSA last spring sent out no employer letters based on the 2006 tax year but that some workers did receive personal notices as part of SSA’s efforts.

SSA uses the no-match letters as a way of informing employers that there is a problem with the W-2 information provided to SSA. Those problems can be due to the wrong name being put on the form, an error in reporting the Social Security number, or other errors that can occur on the employer’s part.

Until this year, SSA has said that the no-match letters were designed to correct information and not meant to serve as an worksite immigration enforcement tool. SSA has opposed permitting DHS to have access to the names of employers who receive the letters because it says the letters are designed to correct data, not create liability.

SSA Argued Potential Harm.

In arguments to the federal court on whether a preliminary injunction should be granted, SSA joined with DHS in arguing that SSA would be harmed if they were unable to send out no-match letters for this tax year because it would mean that there would be a large batch of information that would not be corrected.

In addition, SSA argued to the federal court that pushing back the date it could send the no-match letters would conflict with SSA’s busiest time period — the season from January to March when W-2 forms are sent out — and therefore burden the agency. In its brief to the court, the government argued the failure to send out the no-match letters would “frustrate the purpose of providing notice to employers that their employees’ Social Security earnings are not being credited to their accounts.”

Breyer, however, was unconvinced and pointed out that the injunction did not bar SSA from sending out its letters and instead barred it from including the DHS liability language.

“[T]he plaintiffs have not requested a preliminary injunction precluding SSA from sending out its traditional no-match letters for tax purposes, as the agency has for over a decade,” Breyer said, adding “SSA has acknowledged that it could remove the DHS insert and related language from its mailing in 30 days.”

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About the Author

Mark A. Ivener, A Law Corporation, a nationally recognized law firm, has successfully assisted hundreds of clients in immigration matters.