Is your club ready for a government audit or site visit? While neither one of these scenarios is something that anyone wants to think about, it is imperative that your club is ready in this time of enhanced government scrutiny on organizations that employ foreign nationals. Importantly, some government audits happen even if you do not employ foreign nationals. What types of audits and government visits affect private clubs?
Audits for All
First, let’s take a look at audits and site visits that can happen to any club, regardless of whether if it employs foreign nationals. These audit/site visits include:
U.S. Department of Labor (DOL) Wage & Hour Audits
Generally speaking, Wage & Hour Audits are not random. They are almost always triggered by an event, such as a disgruntled employee filing a report with the government. Out of all of the audits discussed in this article, this is the most tedious for a club, often seeing a DOL auditor ask for a substantial amount of documentation and information. Onsite interviews of personnel are also common. These audits can last for months and even years and can focus on just about any area that is governed by the DOL. If your club sponsors foreign nationals for H-2B visa workers, Wage & Hour Audits will almost certainly involve a look into your organization’s H-2B visa petitions.
If your club is faced with a Wage & Hour Audit, you should consult with your employment and immigration lawyers to ensure that you are prepared both for how to interact with the DOL auditor as well as what to provide in the way of documentation.
U.S. Social Security Administration (SSA) No-Match Letters
They’re back! After about a decade of mercifully not seeing these letters, there has been a recent uptick in No-Match Letters. These letters are sent to workers and employers when the workers’ names and Social Security numbers do not match. The good news for clubs is that most of these letters have seemed to be sent to restaurants and manufacturing companies. If your club receives a letter, though, make sure to reach out to your club’s immigration or employment lawyer. The regulations are not clear on how to proceed if you receive one as adverse employment action, including termination, is disallowed.
I-9 Audits
While I-9 audits are extremely rare, they do occur. These are almost always a result of a formal complaint or from a government official wanting to further investigate an organization following other types of audits. When they do occur, not having your club’s I-9 Forms in order—and completed correctly—can trigger thousands of dollars in fines.
The best way to prepare for an I-9 audit is to conduct an internal audit of your I-9 Forms to ensure that you have a completed form for every employee and that they are all completed correctly. Conducting an internal I-9 audit will not only give your club peace of mind, but also provides a good faith defense against fines in the event of an official government I-9 audit.
Audits When Employing Foreign Nationals
If you employ H-2B, J-1, F-1, or H-1B visa employees, there are additional audits and site visits that can occur.
For those that employ H-2B visa holders, you might have already received paper audits in the mail. These are random paper audits that occur about once every three years. While generally benign, the biggest issue here is timing. The government gives organizations only a couple of weeks to respond, which can be difficult during busy times of year. Be careful with these audits—while they are generally straight-forward, adverse action, including fines, can be levied if you are non-compliant or do not adequately address the government’s requests.
Additionally, H-2B visa employers may have received unannounced government site visits last year. These were the result of a government initiative aimed specifically at the hospitality industry. These visits were thankfully uneventful and we heard positive comments from our clients about the way that the government officials treated them during the visits.
Finally, unannounced site visits can occur if your organization employs H-1B visa holders, J-1 visa holders, and those working on F-1 student visas post-graduation. When these visits occur, the government officials usually want to check the validity of information in visa petitions as well as view the worksite of the foreign national. The official may also want to review the training plan for J-1 and F-1 visa holders.
To prepare for site visits, make sure to train the security at your front gate as well as your front desk personnel on how to handle government officials. Additionally, always make sure to review visa petitions carefully to ensure that all information is accurate. Finally, it is imperative to notify your immigration lawyer about changes in employment, including worksite location and promotions.
Be at the Ready
In this time of enhanced government scrutiny on employers—especially in the immigration context—it is more vital than ever to be diligent and ready for government audits. Working and consulting with a lawyer, even on H-2B and J-1 visas, is more important than ever. We have found that as long as clubs take the time to focus on compliance, government audits and site visits can be a stress-free occurrence.
Keith Pabian is an immigration attorney with a national practice focused on the private club industry, assisting clubs around the country with H-2B seasonal visa and year-round immigration options. He is a proud Board member of the National Club Association. Keith can be reached at (617) 939-9444 or [email protected]. This article was prepared for educational purposes only.