California Compliance Refresher: Immigration Enforcement Without the Missteps or Miscalculations

For many California employers, immigration enforcement no longer appears as a dramatic but rare worksite event. Recent enforcement activity has required employers to shift from a reactive posture to one that is proactive and compliance focused. Even as public attention shifts, the intersection of California and federal law continues to create meaningful risk for employers that do not approach this area with care.

California employers, along with employers in Oregon, Illinois, and Massachusetts, face a unique situation as numerous state laws either govern the actions employers may take to comply with federal law or create additional employer obligations.  The compliance challenge is not choosing between state and federal law, but understanding how to operate within both and threading an increasingly large thread through a shrinking needle.

This refresher highlights recurring compliance issues and explains how well intentioned actions can create exposure, including potential civil penalties.

The Compliance Tension Employers Must Manage

California, through statutes such as the Immigrant Worker Protection Act (AB 450) and the Workplace Know Your Rights Act (SB 294), places specific limits on employer conduct and imposes affirmative obligations. Compliance obligations for California companies can be triggered at three times: during the initial hire and onboarding; during the tenure of employment; upon notice of a federal investigation or inspection and the related inspection results.

For California employers, compliance obligations typically arise at three points: 1. Onboarding; 2. during employment; and 3. when a federal immigration inspection is initiated and later when inspection results are issued. Each stage presents separate risks, particularly where federal requirements and California restrictions intersect.

Onboarding

Under federal law, employers must verify the identity and work authorization of every employee hired on or after November 6, 1986 using Form I-9. California law imposes additional restrictions in this process. Labor Code section 1019.1 prohibits employers from rejecting documents that reasonably appear genuine and relate to the individual, where those documents satisfy federal requirements. This prohibition carries civil penalties that can reach up to ten thousand dollars per violation and may be enforced by the California Labor Commissioner independent of federal enforcement.

California also regulates the use of E-Verify. While participation in E-Verify is generally voluntary, state law limits when and how employers may use the system and creates potential liability for misuse. Employers must follow federal program rules when handling tentative nonconfirmations and ensure that employees are properly notified.  Most importantly under California Labor Code Section 2814, California employers can be fined for misuse of the system including using E-Verify for prescreening new hires.  

In addition, California’s Workplace Know Your Rights Act requires employers to provide employees with a stand-alone written notice of rights at the time of hire and annually thereafter. This notice must address workplace rights and protections, including rights that may arise if immigration enforcement occurs at the workplace. Employees must also be given the opportunity to designate an emergency contact. If an employee consents to notification and the employer has actual knowledge that the employee has been arrested or detained in connection with workplace enforcement, the employer must notify the designated individual.

During Employment

During the course of employment, employees may update their personal information, including a change in name, Social Security number, or work authorization documentation. These situations must be handled carefully.

Under California law, an employer may not take adverse action, including termination, against an employee who presents new identity or work authorization documents where those documents reasonably appear to be genuine and relate to the individual. Even where the new documentation differs from what was originally provided, the employer must evaluate it under the same standards used at the time of hire. In these situations, government guidance on identity changes should be followed and counsel from an experienced practitioners should be considered.  While California Labor Code Section 2814, prohibits employers from E-Verifying existing employees, actual  “change of identity situations” are nuanced and should be discussed with counsel. 

Employees also have the right to request information regarding an employer’s compliance with applicable Labor Code provisions. Employers must continue to provide the required notice of rights annually in accordance with SB 294.

Federal Inspection and Results

When Immigration and Customs Enforcement initiates a Form I-9 inspection, California law imposes strict and time sensitive obligations that operate alongside federal requirements.

Upon receipt of a Notice of Inspection, employers must provide notice to all employees and any applicable union within seventy two hours. The notice must be communicated in the language the employer normally uses for employment communications.

When the employer receives inspection results identifying deficiencies or issues related to specific employees, the employer must provide affected employees and their authorized representatives with a copy of the relevant notice within seventy two hours. Examples of deficiency notices could include a Notice of Technical or Procedural Violations, a Notice of Suspect Documents or a Notice of Intent to Fine. The employer must also include specific information, including a description of the deficiencies, the time provided to correct them, the date and location for any meeting with the employer, and notice of the employee’s right to representation.

These requirements arise under the Immigrant Worker Protection Act, which also prohibits employers from voluntarily allowing immigration enforcement agents to enter nonpublic areas of the workplace or access employee records without a judicial warrant or subpoena.

Failure to comply with these provisions can result in significant civil penalties ranging from $2000 to $5000 for a first violation and up to $10,000 for subsequent violations, assessed per violation.

At the same time, federal law continues to prohibit obstruction of lawful investigations, including making false statements, concealing information, or interfering with agency processes. Employers that act informally or inconsistently when responding to enforcement activity risk creating exposure under both state and federal law.

Where CA Employers Continue to Make Mistakes

Employers rarely face exposure because they misunderstand the law at a high level. Risk more often arises from failing to understand how state and federal obligations operate together and then reacting in real time without a clear framework. Common failure points include:

• Granting access without proper legal process. Managers may allow agents to enter nonpublic areas or review records without confirming the existence of a judicial warrant or subpoena. Cooperative intent does not excuse violations of California law.
• Missing the seventy two hour notice deadline after a Notice of Inspection. Employers often assume that an extension from ICE to produce Forms I-9 also extends California’s notice obligations. It does not. The obligation to notify employees is triggered upon receipt of the Notice of Inspection and runs independently of any federal deadline.
• Improper handling of inspection results. Employers may delay or summarize deficiency findings while determining next steps. California law requires specific written notice to affected employees within seventy two hours, including details of the deficiency and the employee’s right to representation.
• Unnecessary reverification or document requests. In an effort to mitigate risk, employers may request new documentation or reverify employees outside of federally required circumstances. These actions can create exposure under both federal anti-discrimination rules and California law.
• Uncoordinated or inconsistent communications. Statements made by supervisors or HR personnel without coordination can later be characterized as inaccurate or misleading, particularly where multiple individuals respond to enforcement activity differently.
• Lack of operational readiness. Initial interactions with enforcement often occur at the front line. Without training and clear escalation protocols, employees may take actions that bind the organization before legal review occurs.

Balanced Compliance Is the Goal

The safest approach is neither resistance nor reflexive cooperation, but rather informed careful consideration that accounts for both state and federal requirements. Employers should consider the following steps:

• Establish a centralized point of contact responsible for immigration-related compliance and response.
• Work with experienced counsel who understand the interaction between federal immigration law, California law, and employment law.
• Train managers and staff on how to recognize and appropriately respond to onsite enforcement activity, including the types of documents that may be presented.
• Develop and maintain a written response protocol that addresses how to handle worksite visits, I‑9 inspections, document requests, and internal communications.
• Implement ongoing training, auditing, and process review mechanisms to ensure that policies, and underlying Form I‑9 and E‑Verify practices, including complying with electronic I‑9 systems regulations (often overlooked), remain effective and aligned with current legal requirements.

Employers should not wait until enforcement activity begins to determine their approach. Clear protocols, trained personnel, and a working understanding of both California and federal requirements, including disciplined I‑9 and E‑Verify practices, are essential to managing these situations without compounding risk.

For more information, contact your Seyfarth relationship partner or the authors directly. Seyfarth’s Immigration Compliance & Investigations specialty group is recognized as a national leader in the field. Trusted by Fortune 100 companies and small businesses nationwide, the team provides strategic, practical guidance across the full spectrum of immigration compliance. The group advises on Form I-9 and E-Verify compliance; ICE inspections and worksite enforcement actions; internal immigration assessments and I-9 audits; DOL immigration-related wage-and-hour investigations; H-1B compliance; and DOJ’s IER and OCAHO anti-discrimination matters, including foreign sponsorship and export control/ITAR issues. The team complements its expertise in the Immigration Compliance & Investigations sector with its first-in-class litigation capabilities. Seyfarth is here to help employers navigate a path to California compliant practices and assist with defending against state and local agency enforcement efforts should they occur. Check out the CalPeculiarities Blog for other legal developments affecting California employers.