November 27, 2007

Department of Homeland Security Backing-Off from the No-Match Rule

On Friday, November 23, 2007, Department of Homeland Security (DHS) filed a motion in Federal District Court in San Francisco requesting that the case on the merits be stayed.  DHS requested the stay pending its promulgation of a new rule taking into account the concerns Judge Charles R. Breyer of the U.S. District Court for the Northern District of California raised.  Judge Breyer raised several concerns when he issued the preliminary injunction on October 10, 2007 preventing implementation of the rule.  The DHS motion was granted, placing the litigation on hold until March 24, 2008, when DHS anticipates the new rulemaking proceedings will be complete.

The good news is that the government has basically admitted that the original no-match rule is flawed and that there is no point in appealing the preliminary injunction decisions or in moving ahead with fighting the rule in a hearing on the merits.  While the details of the new rule are not known, the DHS motion indicates that the government will undertake an analysis of the proposed rule’s impact on small businesses by conducting the required Regulatory Flexibility Act analysis.  While proceedings are stayed, the government will be required to provide the Court with monthly reports on the progress of the “No Match” rulemaking process.  Throughout this period, the preliminary injunction will remain in effect.

The litigation involved the Department of Homeland Security’s (DHS) final rule which provides guidance on how employers should respond to Social Security Administration “No Match” letters while at the same time broadening the definition of “constructive knowledge.”  For a detailed background please see the Greenberg Traurig Immigration Alert “No-match, ICE, Investigations, Fines, I-9s — How Much More Difficult Can it Get to Run a Business?” as well as our October 10, 2007 and November 16, 2007 news flashes.

Greenberg Traurig will continue to monitor this lawsuit and provide timely updates.