What Is E-Verify Used For? Who Must Use It and Penalties

E-Verify is a free, web-based federal system that employers use to confirm whether a newly hired employee is authorized to work in the United States. After the worker completes Form I-9, the employer enters the information into the E-Verify portal, which compares it against records held by the Department of Homeland Security and the Social Security Administration and returns a result in seconds.¹

What Employers Actually Do With It

Every U.S. employer already has to verify the identity and work authorization of each new hire by completing Form I-9.² E-Verify sits on top of that paperwork. Once the I-9 is done, the employer takes the employee’s name, date of birth, Social Security number, and work authorization document details, enters them into E-Verify, and the system checks them against millions of government records.³

A response usually comes back in three to five seconds.⁴ The point is to catch document fraud, stolen Social Security numbers, and data-entry errors that a visual review of paperwork will not.

A few practical requirements come with using the system. A Social Security number is optional on the standard Form I-9 but mandatory once an employer runs E-Verify.⁵ Any List B identity document, such as a driver’s license, must contain a photograph, a requirement Congress added in Section 403 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996.⁶ And if the employee presents a U.S. passport, passport card, permanent resident card, or employment authorization document, the employer has to keep a copy for the system’s photo-matching step.

Who Has to Use It

For most private employers, E-Verify is voluntary. Two groups are not free to opt out.

Federal Contractors

Executive Order 12989, as amended in 2008, directs federal agencies to require contractors to verify work eligibility through E-Verify.⁷ The Federal Acquisition Regulation puts that into effect through FAR 52.222-54, which applies to prime contracts above the simplified acquisition threshold with a performance period of 120 days or more and at least some work performed in the United States. Covered subcontracts over $3,500 must include the clause as well.⁸

Federal contractors are also the one group that may run E-Verify on existing employees, but only those assigned to a covered contract. New contractors generally must create cases for those employees within 90 calendar days of enrolling or within 30 calendar days of the employee’s assignment, whichever is later.⁹ Any employer without a covered contract is prohibited from running the check on current employees.¹⁰

State Mandates

Several states have passed their own laws requiring E-Verify. These often cover all public employers, and some reach private businesses above a certain size or in specific industries. Penalties for ignoring a state mandate can include suspension or revocation of business licenses along with administrative fines. Because the rules differ so much from state to state, an employer operating in more than one place has to check each one.

When It Cannot Be Used

E-Verify is for confirming work authorization after hire, and the rules around that are narrower than employers sometimes assume.

A case must be created no later than the third business day after the employee starts work for pay.¹¹ Not earlier as a screening tool, not weeks later as an afterthought. Pre-screening job applicants before hiring them is prohibited.¹²

An enrolled employer also cannot pick and choose. Cases have to be created for every new hire, not only those who look or sound foreign, and the system cannot be used in a way that discriminates based on national origin, citizenship status, race, or other protected characteristics.¹² Violations can lead to suspension or termination from the program and penalties under the Immigration and Nationality Act’s unfair immigration-related employment practices provisions.

If the system is offline during the three-day window because of an outage or a federal holiday, those days don’t count against the deadline; the employer selects a reason for the delay when the system returns.¹³ An employer that simply misses the deadline should create the case immediately.¹¹

What the System Returns

A submitted case produces one of a few results.

Employment Authorized is the most common. It means the employee’s information matched DHS and SSA records, and the employer closes the case.¹⁴

A Tentative Nonconfirmation (mismatch) means what the employer entered doesn’t match agency records. That does not by itself mean the person is unauthorized; a typo, an unreported name change, or outdated government data can trigger it.¹⁵ The employer must notify the employee, provide a Further Action Notice, and give the employee the choice to contest. While the mismatch is pending, the employer cannot fire, suspend, delay training, withhold pay, or take any other adverse action against the employee because of the result.¹⁶

A Final Nonconfirmation follows if the employee doesn’t contest in time or if the agency ultimately cannot confirm authorization. At that point, the employer is generally expected to end the employment relationship to stay in compliance.

What Getting It Wrong Costs

Penalties fall into two buckets. I-9 paperwork violations, such as failing to complete, retain, or produce forms for inspection, carry a civil money penalty of $288 to $2,861 per violation under the most recent inflation adjustment.¹⁷

Knowingly hiring or continuing to employ an unauthorized worker is far more expensive:

First offense: $716 to $5,724 per unauthorized worker.
Second offense: $5,724 to $14,308 per unauthorized worker.
Third or subsequent offense: $8,586 to $28,619 per unauthorized worker.¹⁷

An employer that receives a Final Nonconfirmation and keeps the person on payroll anyway risks being treated as knowingly continuing to employ an unauthorized worker, which pulls the higher range into play. Federal contractors that violate E-Verify requirements also face possible debarment from future government contracts.¹⁸

1
E-Verify. What Is E-Verify
2
U.S. Citizenship and Immigration Services. Handbook for Employers M-274 – 1.0 Why Employers Must Verify Employment Authorization and Identity of New Employees
3
E-Verify. E-Verify Overview
4
E-Verify. What Is E-Verify
5
E-Verify. 2.1 Form I-9 and E-Verify
6
E-Verify. Why Does DHS Require an Employer to Only Accept List B Documents That Contain a Photo
7
Federal Register. Amending Executive Order 12989, as Amended
8
Acquisition.gov. FAR 52.222-54 Employment Eligibility Verification
9
E-Verify. Timeframes for Enrollment and Use
10
E-Verify. May I Verify an Existing Employee in E-Verify
11
E-Verify. 2.2 Create a Case
12
E-Verify. E-Verify User Manual
13
E-Verify. E-Verify Resumes Operations
14
E-Verify. Tentative Nonconfirmations (Mismatches)
15
E-Verify. DHS and SSA Mismatches
16
E-Verify. 3.3 Tentative Nonconfirmation (Mismatch)
17
Federal Register. Civil Monetary Penalties Inflation Adjustments for 2025
18
U.S. Citizenship and Immigration Services. Handbook for Employers M-274 – 11.8 Penalties for Prohibited Practices