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What should I do if I receive a No Match letter from SSA?

by Kent B. Gravelle, Esq.

Here is the scenario:

You are an employer and you have received a letter from the Social Security Administration (SSA) stating that that the Social Security number provided on the W-2 Form for a certain employee does not match SSA's records.  The letter goes on to say that you should not take any adverse action against the employee based on this letter, but it also instructs you to fix the problem.  What now?

Unfortunately, employers are faced with somewhat of an apparent conflict in the laws with regard to what actions to take when they receive no-match letters from the SSA regarding employees.  While 8 U.S.C. §1324a(2) states that “it is unlawful for employers to continue to employ the alien in the United States knowing the alien is (or has become) an unauthorized alien with respect to such employment”, 8 C.F.R. 274a.1 has defined “knowing” as having actual or constructive knowledge through the exercise of reasonable care.  To complicate matters further, a bill has been introduced in the Senate by Senator Sessions (S 2710 PCS) seeking to amend 8 U.S.C. §1324a(2) to read “knowing or having constructive knowledge that” the alien is an unauthorized alien.  However, at the time of the writing of this article, Senate Bill 2710 is not on the cusp of becoming law.   Finally, 8 U.S.C. §1324b(a)(6) states that requesting “more or additional documents” from an employee than those specifically identified in the Act “shall be treated as an unfair immigration-related employment practice;” also known as document abuse.  So, what do you? 

“What have the courts said on this topic?”

As you might expect, the courts are split.  The Tenth Circuit has taken a position on this issue which seems to favor employers while the Ninth Circuit has taken a position on this issue which clearly favors employees, although the facts of each case are different.  The Ninth Circuit held on June 16, 2008, in Aramark Facility Services v. Service Employees International Union (Court File #:  06-56662) that no-match letters from the SSA regarding Aramark’s employees at the Staples Center in Los Angeles did not justify Aramark’s letter to the affected employees that they would be terminated unless a new social security card or verification form showing that a new SSN card was being processed was provided to Aramark within three business days.  The court essentially held that the employer was wrong for reacting as it did in response to the SSA no-match letter.  The Ninth Circuit explained that to prevent discrimination against persons with “an appearance of alienage…the doctrine of constructive knowledge must be sparingly applied.”  Id.at 12.  The Court also stated that “…employers do not face any penalty from SSA, which lacks an enforcement arm, for ignoring a no-match letter.”  Id.at 14.  A previous arbitration award was enforced which awarded the fired workers back-pay and reinstatement. 

A much different result occurred in the Tenth Circuit in Zamora v. Elite Logistics, Inc., 478 F.3d 1160 (10th Cir. 2007).  In Zamora, an employer allegedly received a tip that it would be subject to an INS inspection whereupon the employer hired two independent contractors to confirm the validity of all of the employee’s social security numbers.  It was determined that Mr. Zamora’s SSN had been used by another person in California.  Mr. Zamora was laid off but was allowed a chance to return if he provided further documentation, which he did, including a naturalization certificate and then a statement from SSA which verified Mr. Zamora’s SSN.  However, the employer did not offer to reinstate Mr. Zamora after the naturalization certificate was presented but only after the statement from the SSA was received.  Upon returning to work, Mr. Zamora presented his employer with a letter typed by his attorney which required that the employer provide an apology in writing with an explanation of the reason for the termination.  The employer refused to provide an apology and barred Mr. Zamora from working.  Id.at 1164.

Mr. Zamora sued the employer under Title VII exclusively. The Kansas district court granted the employer’s motion for summary judgment essentially holding that the employer’s actions were justified by its fear of sanctions resulting from the possible INS inspection.  A divided panel of the Tenth Circuit Court of Appeals reversed in 449 F.3d 1106 (10th Cir. 2006), holding that a reasonable jury could find an inference of illicit discrimination when the employer refused to reinstate Mr. Zamora even after he presented his naturalization certificate.  Id.at 1114.

The entire Tenth Circuit Court of Appeals then considered the matter en banc at Zamora v. Elite Logistics, Inc., 478 F.3d 1160 (10th Cir. 2007) and affirmed the district court’s granting of summary judgment through a multitude of concurring opinions and with a very vigorous dissent.  The concurring decision by Judge Gorsuch emphasized that suit was only brought under Title VII and not IRCA (the Immigration Reform and Control Act of 1986) which the district court held only applied to the hiring and not termination of employees.  Mr. Zamora’s counsel did not challenge this determination.  Id.at 1183.  If Judge Gorsuch had dissented rather than concurred, the district court’s decision would not have been affirmed.  On the whole, the other judges voting to affirm the grant of summary judgment held that there was not enough evidence to show any discriminatory animus on the part of the employer.  The dissent focused on 8 U.S.C. §1324b(a)(6) and 8 C.F.R. §274a.1(1)(2.10) which bar an employer from requesting “more or different” documents than those that are required under IRCA.  Id.at 1189, 1190.

“So, what does all this mean?”

All of this means that the employer must walk a tightrope between pitfalls.  If the employer fails to investigate workers who it reasonably suspects are not permitted to work, it could be subject to drastic penalties from the Department of Homeland Security.  However, if it terminates an employee who was merely the victim of identify theft, it could be subject to a lawsuit from the employee as in Aramark Facility Services v. Service Employees International Union (Court File #:  06-56662) and Zamora v. Elite Logistics, Inc., 478 F.3d 1160 (10th Cir. 2007). 

Clearly, providing little or no notice prior to termination to the employee that is the subject of a SSA no-match letter is an invitation to long and protracted litigation.  Requiring the employee to provide further information could cause the employee to bring a document abuse claim.  However, doing nothing may invite a crackdown from the Department of Homeland Security.

The confusion is further magnified by the aforementioned bill regarding “safe harbor” provisions that has not yet become law as it has been enjoined from implementation by a federal court in AFL-CIO v. Chertoff (N.D. Cal. #07-CV-4472 CRB).  A new proposal from the Department of Homeland Security to amend the safe harbor regulation (found at 73 Fed.Reg. 15944) has been severely criticized by many commentators, including the American Immigration Lawyers Association.  A change of administrations within the next six months could possibly lead to even further confusion, at least in the short term.

Because the law is clearly in a state of flux, it is probably impossible to chart a course of action that is immune from the dangers of either the DHS or the employees’ lawyers.  Until and unless Congress amends the applicable laws, employers should document their efforts with regard compliance with no-match letters and refrain from terminating the employee until it is sure that the worker is truly an undocumented alien.  Employers are advised not to follow the recent proposed rules from the Department of Homeland Security until the litigation over such rules is resolved. 

Kent Gravelle is an attorney with Cundy & Martin, LLC Mr. Gravelle’s practice is centered on business defense.  Kent is also experienced with matters involving asbestos litigation, employment law, insurance law, and collections.  Mr. Gravelle is licensed to practice in all state and federal courts in Minnesota and North Dakota.