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NAKASEC Comments on SSA No-match

By May 2, 2008No Comments

April 25, 2008

Marissa Hernandez
U.S. Immigration and Customs Enforcement
425 I St. NW, Suite 1000
Washington, D.C., 20536

Re: National Korean American Service & Education Consortium
Comments to DHS Docket No. ICEB-2006-0004

Dear Ms. Hernandez:

The National Korean American Service & Education Consortium (NAKASEC), submits the following comments in opposition to the supplemental proposed rule on Safe Harbor Procedures for Employers Who Receive a No-Match Letter.

NAKASEC, a national non-profit organization based in Los Angeles, California, was founded in 1994 by local community centers: Korean Resource Center (KRC) in Los Angeles, Korean American Resource & Cultural Center (KRCC) in Chicago and YKASEC – Empowering the Korean American Community (YKASEC) in New York. The centers sought to empower and improve the lives of Korean Americans as part of a greater goal of building a national movement for social change. NAKASEC is a multi-issue civil and human rights organization that is based within the Korean American community. Our mission is to project a national progressive voice for and promote the full participation of Korean Americans in the United States through education, advocacy, and community organizing.

The purpose of the no-match letter is to ensure that workers receive credit for their earnings, which can affect future disability and retirement benefits. The Social Security Administration (SSA) no-match letter program cannot effectively meet DHS’s goal of preventing employers from unlawfully hiring unauthorized workers.

The supplemental proposed rule does not rectify the inherent problems in the Safe Harbor rule. We therefore urge DHS to reconsider its ill conceived policy and withdraw the Safe Harbor rule.

Representing Korean American communities nationwide, in response to the SSA No-match Letter rule, we have provided public education and conducted outreach programs for community members so that they understand the rule and know how to properly respond to the letter. Since the release of the rule in August last year, NAKASEC and its three affiliates have received more than one hundred calls from employers and workers concerned of its impacts on their business and employment. Based on our communication and interaction with community members, we believe the following issues/concerns should be addressed:

This supplemental proposed rule fails to address real concerns raised by the court and public.

This supplemental rule makes no substantive changes from the Final Rule published in August of 2007. We do not believe that this addresses any concerns raised by court nor comports with the decision from the United States District Court for the Northern District of California’s injunction and related comments on October 10, 2007. Moreover, DHS fails to provide any new evidence or information that no-match letters are an effective tool for identifying individuals working without authorization.

In fact, the published facts and data overwhelmingly demonstrate the opposite – that no-match letters are in no way a reliable indicator of immigration status. The SSA Office of Inspector General estimates that of the 17.8 million records in SSA’s database that contain discrepancies that could generate a no-match letter, nearly 13 million (or 70 percent) of those records pertain to U.S. citizens. SSA itself is unable to estimate how many of the un-matched wage items in its database belong to undocumented workers. The Government Accountability Office (GAO) testified before Congress that the Earnings Suspense File (ESF) contains “hundreds of millions of records, many unrelated to unauthorized work,” and that “in terms of poor earnings reporting, its focus is not on unauthorized workers.” GAO further stated that “most” of the earnings that have been correctly reinstated belong to “U.S.-born workers, not to unauthorized workers.” In the Safe Harbor rule itself, DHS also admits that it “does not have adequate data to estimate the percentage of unauthorized employees with SSNs that are listed on no-match letters.”

DHS also asserts that the proposed rule will not affect employers with “stray mistakes” or “inaccuracies” in their records because the employer no-match letter is only sent to employers with at least 11 workers with no-matches, and where the total number of no-matches represents more than .5 percent of the employer’s total Forms W-2 in the report. It is inaccurate to say that the rule will only impact those employers. Since the issuance of the proposed rule in 2006, employers, not knowing the difference between the employer no-match letter that includes a number of workers (EDCOR letter) and the individual employee no-match letter sent to employers (DECOR), have implemented the Safe Harbor rule upon receiving the individual employee no-match letter (DECOR letter). Some employers have even implemented the no-match rule after conducting self SSN audits through the SSA’s systems, although not always following the procedures recommended by DHS. Other employers have strategically used the DECOR no-match letters to directly interfere with workers’ rights and have used the safe harbor rule as a shield to protect them from liability for unlawful retaliation under labor and employment laws.

The rule imposes undue burdens on business owners and immigrant workers who will more likely have a difficult time proving their legal status.

The majority of Korean American community members are engaged in small businesses and heavily depend on immigrant labor. SSA no-matches will have adverse impact on small businesses because immigrant workers will generally have a more difficult time proving their legal status than U.S.-born citizens in correcting no-matches. For example, if a US citizen worker had derived citizenship through her or his parents at a young age and fails to get her or his certificate of citizenship, s/he has to wait as long as one year to get a new or replacement certificate. As a result, the worker would have significant difficulties proving her or his legal status and correct no-matches. To correct the name with SSA, s/he needs to prove citizenship by showing a certificate of citizenship. Failing to do so, s/he will face a risk of termination. The proposed rule fails to address the key problems that the SSA does not have a flexible policy for accepting documents required to prove identity and citizenship. Such problems will inevitably harm a number of business owners dependent on immigrant labor.

The rule has resulted in the firing of lawfully authorized workers.

The supplemental rule does nothing to address the ways in which no-match letters have had an adverse impact on all workers, regardless of immigration status. Employer confusion and misunderstanding of the proposed rules, and whether or not receipt of an SSA no-match letter would automatically trigger employer sanctions, has resulted in the wrongful termination of U.S. citizens and immigrants who are lawfully authorized to work in the United States. Shortly after DHS issued its proposed rule in 2006, and continuing through the publication of the final rule in 2007 (even after the federal court preliminarily enjoined the final rule in October of 2007), employers nationwide fired lawfully authorized workers after receiving no-match letters from the SSA.

The experiences of workers in 2006, 2007 and early 2008 confirm that employers will continue to summarily discharge workers without giving them an opportunity to correct their records. Other times, the employers give the workers the opportunity to correct the SSA discrepancy, but do not even give the workers the time allotted in the DHS rule. Because employers did not follow the admonishment on the original SSA letters that no adverse action should be taken against workers who are the subject of no-match rules, there is no reason to believe that they will do so when it is clear that the no-match letters may well have employer sanctions consequences. Regardless of the process set up in the rule, employers will undoubtedly continue to unjustly fire workers. Under current law, there is very little recourse for these workers unless they file legal claims alleging the employer discriminated against them or engaged in other unlawful action or engage in collective action to put public pressure on the employer. Thus, all workers who are wrongly terminated under the DHS rule, even if they are U.S. citizens or work authorized immigrants, will be left without any meaningful remedy against their employer or the federal agencies. Additionally, there are workers who will be fired because they cannot correct their records within the 93-day timeframe. According to DHS’s own estimates, over 70,000 authorized workers could be wrongfully terminated due to the rule.

The rule will continue to undermine labor rights thereby causing a detrimental impact on all workers.

Since the beginning of the no-match program, unscrupulous employers have misused no-match letters as a tool to undermine workers’ rights to engage in concerted activity, erase the benefits that come with seniority, and to defeat a variety of workplace claims, including their own failure to pay the minimum wage. This, in turn, affects the ability of other workers to exercise their labor rights, and the conditions of all workers suffer.

The DHS rule will continue to provide unscrupulous employers with an added tool to undermine the labor and employment rights of all workers.

The rule will burden SSA, an already overburdened agency and create more bureaucratic barriers to correct and respond to no-matches in the SSA system.

The SSA was created to provide benefits to workers when they retire, become disabled or to their survivors upon death. The agency is not an immigration enforcement agency. It is well-documented that SSA’s primary database that is used for identification, the Numident file, is riddled with inaccuracies. The no-match letter program is only one of several programs that the SSA employs to correct the voluminous errors in its database. The DHS’s attempt to convert the no-match letter program into an immigration enforcement tool using the SSA’s fatally flawed database will result in huge costs to the SSA and its employees.

The SSA is already overburdened with its current workload of delivering services for which the agency was created. SSA estimates that the average wait time for more than three quarters of a million cases awaiting a hearing decision on disability cases is 499 days. SSA Field Offices receive over 60 million phone calls each year and over half of the callers receive a busy signal. Despite SSA’s increased workload, its workforce is at its lowest staffing level. Because SSA estimates that four percent of the U.S. workforce has records that don’t match, the DHS rule will inundate SSA offices with visitors and callers seeking to correct records. According to SSA employees, the impact on SSA will be devastating. If new employees are not hired to take on the new no-match work, the delivery of existing services will continue to deteriorate. And more people will be trapped in bureaucratic limbo and face hardships caused by a delay in correcting no-matches.

The rule will be costly to the American economy.

The loss of jobs and productivity that will result due to the DHS rule is a high price to pay for an ineffective immigration enforcement tool. U.S. workers and the economy will undoubtedly bear the brunt of the costs of the rule. Because of the millions of inaccurate records in the SSA database, hundreds of thousands of U.S. workers will be required to take time off of work to visit SSA field offices to correct alleged no-match discrepancies. Many of these hundreds of thousands of workers will likely be required to make multiple visits to SSA offices in order for no-match issues to be resolved due to evidentiary requirements. Lawfully employed workers have been known to made up to 5 (five) visits to SSA field offices in order to “correct” no-match discrepancies. Workers will lose time from work and pay in order to correct discrepancies, while employers will lose a much-needed workforce.

Converting no-match letters into proof of unauthorized immigration status will exacerbate the already existing problems of the “off the books” economy, and the gap between payroll and other taxes owed to states and the federal government, and actual payment of said taxes. The rule will allow unscrupulous employers to evade response to no-match letters by simply paying workers as “independent contractors,” or remaining completely off the books through cash transactions, thereby creating an even greater un-regulated underground economy. This will undoubtedly hurt law-abiding employers who pay taxes while providing a benefit to the “bad” employers.

For the reasons outlined above, NAKASEC firmly opposes the reissuance of the “DHS Safe Harbor Procedure for Employers Who Receive a No-Match Letter.” The reissued rule does not remedy any of the inherent problems identified by the courts, and will continue to create havoc in the workplace and to the U.S.economy. U.S. workers and employers will be negatively impacted by the implementation of the rule. As such, we close reiterating our request that DHS withdraws the Safe Harbor rule.


Eun Sook Lee
Executive Director
National Korean American Service & Education Consortium (NAKASEC)
900 S Crenshaw Bl, Los Angeles CA 90019
TEL 323.937.3703 ext. 205 – FAX 323.937.3753