by Todd Photopulos
A new Tennessee law taking effect January 1 requires employers in the state with at least 50 employees to use the federal E-Verify employment verification process.
The new requirement is a result of an amendment to the Tennessee Lawful Employment Act (TLEA). Under the old law, private-sector employers had a choice: either use E-Verify for all newly hired employees or request and maintain copies of identity and work authorization documents from all newly hired employees before letting them work.
After January 1, employers with fewer than 50 employees can still choose to use E-Verify for newly hired employees or request and maintain documents under the TLEA’s list of authorized identity and employment eligibility documents. Although it isn’t required, using E-Verify can be helpful in creating a presumption of nonviolation in the event of an audit.
The TLEA covers not just employees but also “nonemployees,” defined as individuals who, while not employed directly by the employer, are nonetheless paid directly by the employer for labor or services. Companies in Tennessee are required to request and maintain copies of certain identity and work authorization documents for nonemployees unless the workers are employed by a separate company, which presumably would be in compliance with its obligations under the TLEA.
The TLEA contains significant penalties for violations of its work eligibility identification obligations, including company and per-violation fines. First-time offenders are subject to a $500 company penalty as well as a $500 fine for each employee and nonemployee the company failed to verify.
For repeat offenders, the penalties may rise to as high as a $2,500 company fine plus a $2,500 fine per occurrence. There are additional penalties for knowing violations as well as a $500-a-day penalty for failing to timely produce evidence of compliance within 45 days of a final order of violation. The TLEA penalties are in addition to sanctions allowed under federal law.
For more information on the amendment to the TLEA, see the May issue of Tennessee Employment Law Letter.