TBA Law Blog

Posted by: Christy Gibson on Mar 8, 2012

By Bruce Buchanan*


     The Tennessee Lawful Employment Act became effective on January 1, 2012 for employers with 500 or more employees and governmental entities.  Under the new laws, employers may enroll and use E-Verify for newly-hired employees, or it may accept, copy and maintain a state-issued driver’s license or identification, unexpired U.S. passport, permanent resident card, work authorization, birth certificate, certificate of naturalization, or a few other forms of identification from newly-hired employees.

     You will note the documents above are redundant of documentation needed for I-9 verification.  The only real difference is the requirement to maintain a copy of the identification document.  Under the Immigration Reform and Control Act (IRCA), an employer is not required to maintain a copy of the presented documents from List A or Lists B and C, only review them and record the information on the I-9.

     A second provision in the law involves a “non-employee” providing labor or services to an employer.  A “non-employee” is defined as “any individual, other than an employee, paid directly by the employer in exchange for the individual’s services.”  If an employer contracts with an individual/non-employee, it must request and maintain a copy of one of the specified documents, such as state-issued driver’s license or identification.   However, a subcontractor, who is not an individual, is not covered by this provision under the definition of non-employee.

     An employer violates the law by failing to receive E-Verify confirmation or to request and maintain a copy of one of the specified identification documents. An employer has a “safe harbor” and cannot be found to have violated the law by employing an employee without work authorization if the employer utilized E-Verify and received a confirmation or the employee appealed the tentative non-confirmation and the appeal has not been resolved. This “safe harbor” is not available for employers who copy and maintain an employee’s driver’s license or identification if the employee is found to be working without employment authorization.

     The Tennessee Lawful Employment Act is being phased in.  Employers with 200 to 499 employees must comply by July 1, 2012 while employers with six to 199 employees by January 1, 2013. Employers with five or fewer employees are exempt from the law.

     Any lawful resident of Tennessee or a federal agency employee may file a complaint with the Tennessee Department of Labor and Workforce Development, which will investigate such complaints.  This provision is an extension of the current law which only allows state or local officials to file a complaint alleging an employer’s employment of an unauthorized worker.

     The penalties for the new law are: First offense  - $500 penalty + $500 per employee or non-employee not verified or copy of documentation maintained; second offense - $1,000 penalty + $1,000 per employee or non-employee not verified or copy of documentation maintained; and third offense - $2,500 penalty + $2,500 per employee or non-employee not verified or copy of documentation maintained.

     One unanswered question is how is the number of employees employed by a company determined – all employees employed in Tennessee or all employees nationwide, if a company has employees in other states.  The statute is silent on this matter, which implies the number of employees is based on overall employees, not just Tennessee employees. If so, then does the Tennessee statute require the company in non-Tennessee locations to maintain a copy of an I-9 document in order to be consistent companywide? If so, does this create a federal preemption issue with IRCA?

     After the law passed in 2011, it appeared its proponents would attempt to amend the statute in 2012 to make E-Verify mandatory. However, it appears the 2012 legislature has decided to not concentrate on making E-Verify mandatory; rather, it is focusing on a limited number of immigration bills.


*Bruce E. Buchanan is an attorney at the Nashville office of Siskind Susser, P.C., where he represents employers in immigration, labor, and employment law, as well as individuals in immigration law.  He graduated from Vanderbilt University School of Law in 1982. He is the Chair of TBA’s Immigration Law Section as well as editor of Immigration Law Section Newsletter and TBA's Labor and Employment Law Newsletter. Mr. Buchanan is a guest blogger for E-Verify and I-9 News located at http://everifyandi9news.com, covering immigration compliance issues. He may be reached at bbuchanan@visalaw.com or 615-345-0266.