A three-year extension for E-Verify was included in the $42.8 billion appropriations bill for the Department of Homeland Security (DHS) signed recently by president Obama.

E-Verify was set to expire but will now run until at least September 2012. Some lawmakers had been pushing for a five- or ten-year extension. The system’s staunchest supporters in Congress are also trying to pass a law making E-Verify mandatory for all employers.

We’ll keep you posted.

In addition to extending the controversial program for three years, Congress reaffirmed its support by approving $137 million for the system — which allows employers to check on the citizenship status and work eligibility of applicants. Congress retained the stipulation that the program be voluntary for private employers who don’t have federal contracts.

The bill now heads to President Obama, who’s expected to sign it into law.

The U.S. Chamber of Commerce joined forces with the National Association of Manufacturers, among others, to lobby Congress to vote the program out of existence. The C of C and NAM contend the system is rife with errors that result in denials of eligibility for workers who here legally.

The U.S. Department of Homeland Security presented figures on Capitol Hill indicating the system has a 94% accuracy rate, and that was good enough to override C of C and NAM concerns. Further, some state Chamber of Commerce offices, such as in South Carolina,  have endorsed the system and led the way for passage of state laws that make the system mandatory.

The Department of Homeland Security (DHS) announced the so-called ‘no-match’ rules (which told employers what to do if the Social Security number provided by a new hire didn’t match the number in the feds’ database) in 2007. Controversy and legal battles have prevented the rule from ever going into effect.

Now, it’s officially off the books. A regulation was published in the Federal Register on October 7 rescinding the rule.

The DHS announced it will focus on promoting the use of E-Verify as the mechanism for preventing the employment of illegal immigrants.

1. National – Federal contractors doing work for more than 120 days with a value of over $100,000, and subcontractors providing goods and services worth more than $3,000 (read more on these requirements here).
2. Arizona – All employers.
3. Arkansas – State contractors.
4. Colorado – State contractors.
5. Florida – State contractors.
6. Georgia –All public employers, contractors and subcontractors.
7. Idaho – State agencies.
8. Minnesota — All hiring authorities within the executive branch of state government, and employers seeking to enter into a state contract worth more than $50,000.
9. Mississippi — All companies with at least 100 employees. By July 1, 2010, companies with 30-99 employees must comply, and the rest by July 1, 2011.
10. Missouri — All public employers.
11. Nebraska — All state employers and contractors. Also, use of E-Verify is required for private employers who request state tax incentives.
12. North Carolina — All state agencies, offices and universities.
13. Oklahoma — Public employers, contractors and subcontractors.
14. Rhode Island — Executive agencies, and companies doing business with the state, including grantees, contractors, subcontractors and vendors.
15. South Carolina — Employers must use E-Verify, or verify that an employee has a valid S.C. driver’s license or I.D. (or one from a state with similar standards). All companies must comply by January 1, 2010.
16. Utah — Public employers, contractors and subcontractors.

The new E-Verify rule for federal contractors has a lot of employers wondering exactly who’s covered by the requirement — and what they have to do now.

To clear up some of the confusion, U.S. Citizenship and Immigration Services (USCIS) has published answers to a few of HR’s most common questions about federal contractors and E-Verify:

1. Who’s affected by the rule?

Companies will be required to use E-Verify when they enter into federal contracts with a work period of longer than 120 days and a value of more than $100,000. Also, subcontractors are covered by the rule when the prime contract meets those requirements and the subcontract is for services or construction with a value over $3,000.

2. Which employees must be verified?

Covered contractors are required to verify all new hires, as well as any existing employees assigned to the government contract. That includes employees who perform “substantial duties” under the contract, as opposed to those performing overhead or support work.

3. When do we have to enroll?

The rule went into effect on September 8. Any applicable federal contract signed after that date must include an “E-Verify clause” that requires contractors to use the system.

Companies not already signed up for E-Verify have to enroll within 30 days of being awarded the contract and must begin verifying new hires and current employees working on the contract within 90 days.

Of course, companies can sign up whenever they want, so current or prospective federal contractors might as well enroll before they’re required to.

When you enroll, choose “federal contractor” when asked, “Which category best describes your organization?”

4. What if we already have a government contract?

You won’t be required to sign up for E-Verify until you sign a new contract that contains the E-Verify clause.

5. We already enrolled in E-Verify, but not as a contractor? Do we have to re-enroll?

No, but if you aren’t enrolled as a federal contractor, you will need to update your company profile to categorize your company as a contractor.

For more information from USCIS, click here.

A third of companies are currently using E-Verify, according to a recent Manpower survey of 1,800 HR pros and business owners.

The program’s approval rating is pretty high, according to the survey. Of the respondents who use E-Verify, half rated the system as “very good” in terms of “quality, consistency and speed.” Ratings of “excellent” and “good” were given by 10% and 32%, respectively.

Just 1% said E-Verify was “poor,” and the rest said it was “fair.”

Even without a federal mandate requiring employers to sign up, E-Verify use is on the rise. As of June, 5.5 million employment checks had been completed this year, USA Today reports. That’s compared to 6.6 million in all of 2008, which was twice the number reported for 2007.

What do you think? Do you use E-Verify? If so, how’s it been working? Let us know in the comments section below.

At the end of July, a bipartisan group in the House and Senate reintroduced the Secure America through Verification and Enforcement (SAVE) Act, a bill that would ramp up efforts to fight illegal immigration.

Most notably, it would make E-Verify mandatory for all employers. The requirement would be phased in over a four-year period, starting with federal agencies, then federal contractors. Businesses with more than 250 employees would be next, followed by everyone else.

Also, the bill would increase border security and funnel more resources into prosecuting employers that hire illegals.

Does the SAVE Act have a chance to pass? A nearly identical bill was introduced two years ago but voted down. And given that the E-Verify requirement for federal contractors alone has been pushed back several times, an across-the-board mandate seems like it would be a long shot at this point.

But we’ll keep you posted as the story develops.

Fortunately, that’s not true, Amy Lawson, associate chief, Verification Division, U.S. Citizenship and Immigration Services, told attendees of the American Payroll Association’s Annual Congress.

Multistate employers have the option. If companies have worksites in several states with differing laws, management can determine whether it wants to have the entire company using the E-Verify system or just those worksites required by state law.

Right now, more than half of states have laws requiring the use of E-Verify in some circumstances, whether for public entities or those doing business with the states.

The confusion for multi-state employers has occurred because generally, employers must use E-Verify:

• at all worksites in states that require its use (i.e., Arizona and Mississippi), and
• for all new hires so there’s no discrimination.

Federal contractors are preparing for a requirement to begin using the system in September, although that rule has been delayed several times.

The problem: E-Verify doesn’t guard against identity theft, Sen. Charles Schumer (D-NY) said at a recent Senate subcommittee hearing. All the system does is make sure a name matched the social security number assigned to it.

Nothing stops an unauthorized worker from obtaining a SSN and its matching name.

Schumer’s proposed solution: require that the system verifies someone’s identity by using a “specific biometric identifier,” such as a fingerprint. He plans to introduce relevant legislation in the fall.

The debate is just the latest in the fight over E-Verify. In the meantime, federal contractors are preparing for a requirement to start using the system on Sept. 8 — though that same rule has already been delayed several times.

Instead of the “no match” regulation, DHS is promoting the use of its E-Verify system.

Here’s the chain of events that led to the department’s decision to forgo the “no match” rule in favor of E-Verify:

• In fall 2008, under the Bush administration, federal contractors were required to enroll in E-Verify and use it to verify existing employees working on federal projects.
• The U.S. Chamber of Commerce — along with several HR groups — challenged DHS’ E-Verify requirement.
• Parties in litigation reached an agreement on the effective start date of the rule, which is currently scheduled for September 8. This agreement negates the need for the “no-match” rule, according to DHS.
• If the agreement is accepted by the court, Congress will likely take action to amend the law: to make E-Verify mandated — rather than voluntary — for federal contractors.

The silver lining for federal contractors: It looks like you can probably ignore any no-match letters that might come straggling in. DHS won’t be wasting its efforts enforcing the old requirements that came with receiving no-match letters.

The dark, looming cloud for all employers: If Congress is willing to pass legislation mandating E-Verify for federal contractors, it may also decide to extend mandatory E-Verify enrollment for all employers.

Do you think Congress mandating E-Verify for federal contractors is the first step in requiring private-sector employers to use the system, too? Let us know in the comments section below.