People Management & HR

How to know whether your business is required to E-Verify new hires

  • 4 min Read
  • June 17, 2021

Author

Escalon

Table of Contents

The list of states that require E-Verify has expanded in the past decade, and so has the program’s murkiness!

States across the U.S. have been staking out their own paths on whether to adopt this electronic employment verification program, operated by the federal government in an effort to maintain a legal workforce. Some are making it mandatory for all employers, while others are letting individual employers choose. Even the latest entrant to the program — Florida — has created differing E-Verify rules for public and private employers.

As a business owner, it behooves you to acquaint yourself with the E-Verify rules for every state where your firm operates and hires employees. Otherwise, you risk the possibility of a subpoena or penalty from the Immigration Customs Enforcement Agency for running afoul of employment violations.

What is E-Verify?






 

E-Verify is a free, web-based program administered by the Department of Homeland Security and the Social Security Administration that aims to help businesses to sift undocumented immigrants from their pool of potential employees. Using the portal, enrolled employers can electronically confirm the identity and U.S. work eligibility of new hires.

E-Verify does not replace the legal requirement of completing an I-9 Employment Eligibility Verification form. Rather, E-Verify is a supplementary program that works by comparing employees’ I-9 information against records from the SSA and DHS databases.

Who requires it?




Although E-Verify is available for businesses in all 50 states, it has been adopted in a piecemeal fashion. General guidelines on who is mandated to use the program to verify the employment eligibility of new workers are shown in the table below.

America’s updated E-Verify landscape



E-Verify requirements

States

All or most employers

Alabama, Arizona, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Utah

Public employers and/or state contractors

Florida, Indiana, Missouri, Nebraska, Oklahoma, Pennsylvania, Texas

Public employers only

Idaho, Virginia

Local municipalities

Michigan, New York, Oregon, Washington

State contractors only

Colorado, Louisiana, Minnesota

Federal contractors and subcontractors with qualifying contracts that include the Federal Acquisition Regulation E-Verify clause

All states




Note: In addition, employers that want to hire F-1 Visa students pursuing an extension of their optional practical training under a STEM-designated degree program must use E-Verify.

How to register?




If you are required to participate in E-Verify,  ensure that you use the program in a manner that is nondiscriminatory and protective of workers’ privacy. Violations of the E-Verify system and its data can bring severe consequences for your company, such as I-9 audits, civil penalties, contract cancellations, debarment from the E-Verify program or privacy and discrimination claims by employees.

In order to participate in the federal E-Verify program, you must register on its official site and agree to its rules. Here’s an overview of what businesses will need to provide:

  • Basic information about your company, including NAICS code, EIN, total number of employees and hiring sites where you plan to use E-Verify.
  • Access method: employer, agent, corporate administrator or web services.
  • Organization category: federal contractor, state / local government organization etc.
  • A signed memorandum of understanding mandating E-Verify use for new hires
  • Select at least one program administrator.

If your business has multiple hiring sites, you can assign one site to create E-Verify cases for new employees on behalf of the entire company. Also, you do not have to enter separate agreements. A single MOU will suffice for all hiring locations.

What’s the process?




Once enrolled, here’s an overview of how E-Verification works:

Step 1: Submit a completed I-9 with supporting documents.

Step 2: Within three business days of an employee starting to work for pay, create a case for them in the E-Verify portal using information from the I-9.

Step 3:  You may be prompted by E-Verify to compare the employee’s photo on submitted documents against the photo on the portal.

Step 4:  E-Verify compares the employee’s submitted information against DHS and SSA records to generate six possible results: employment authorized; verification in process; tentative nonconfirmation, case in continuance; close case and resubmit; final nonconfirmation.

The backlash against E-Verify




Although this federal employment verification system aims to ensure a legal workforce in businesses across the U.S., it has created substantial headaches for hundreds of thousands of Americans who are legally authorized to work in the country.

Studies have found that E‐​Verify has harmed nearly 750,000 legal workers through erroneous non​confirmation rulings, often leaving them unemployed or costing their employers thousands of dollars for sorting out an appeal. In addition, critics say the so-called surveillance system has failed to halt illegal employment in the U.S.

Privacy advocates have raised concerns that broader use of online E-Verify would lead to increased identity theft, with critics calling the program an additional burden on government agencies meant to do other important tasks.

Talk to our team today to learn how Escalon can help take your company to the next level.

  • Expertise you can trust

    Our team is made up of seasoned professionals who bring years of industry experience to the table. You gain a trusted advisor who understands your business inside out.

  • Quality and consistency

    Say goodbye to the hassles of hiring, training and managing in-house finance teams. You will never have to worry about unexpected leave of absence or retraining new employees.

  • Scalability and Flexibility

    Whether you’re a small business or a global powerhouse, our solutions scale with your needs. We eliminate inefficiencies, reduce costs and help you focus on growing your business.

Contact Us Today!

Tap into the latest insights from experts in your industry

uncategorized

How to Avoid Operational Bottlenecks When Scaling Beyond $10M ARR 

Reaching $10 million in Annual Recurring Revenue (ARR) is a major milestone, but scaling further brings new operational hurdles. From...

Read More
Press Releases

Escalon Achieves SOC 2 Type II Certification, Reinforcing Commitment to Data Security 

April 30, 2025– Escalon Services, a leading provider of back-office solutions for startups and SMBs, proudly announces that it has...

Read More
People Management & HR

From 25 to 100 Employees: The HR Systems You Need to Stay Compliant

Moving from 25 employees to 100 is a tipping point for many businesses. What worked with a lean, close-knit team...

Read More
uncategorized

Compensation Strategies for Medium-Sized Businesses: How to Stay Competitive

Compensation isn’t just about paying people to show up and do work; it’s a strategic tool that can attract top...

Read More
Accounting & Finance

Common Accounting Mistakes That Cost Medium-Sized Businesses Millions 

Accurate accounting is the bedrock of any successful business operation. Yet, medium-sized businesses—those that have grown beyond the small-business stage...

Read More
Taxes

1099 vs. W-2: How to Ensure Compliance and Reduce Risk 

Distinguishing between independent contractors (1099) and employees (W-2) is a pivotal compliance matter for U.S. businesses. Misclassification can result in...

Read More
Accounting & Finance

Capital Raising in Spring: How to Position Your Startup for Investor Interest

Spring symbolizes renewal, making it an apt metaphor for startups aiming to secure fresh capital to fuel their next growth...

Read More
uncategorized

Spring Clean Your Payroll: Essential HR Best Practices for Scaling Startups

Payroll is more than just issuing paychecks—it’s a complex, high-stakes process that can significantly impact employee satisfaction, legal compliance, and...

Read More
Accounting & Finance

How to Leverage Q2 Financial Data to Drive Startup Growth in the Second Half of the Year

For startups seeking sustainable growth, every quarter provides a treasure trove of data—but Q2 data can be particularly revealing. By...

Read More