President Signs Executive Order Requiring All Federal Contractors to Use E-Verify

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July 03, 2008

President George W. Bush signed an executive order requiring all federal government contractors to use E-Verify to confirm the employment authorization of new hires and persons assigned to perform work on future federal contracts. E-Verify is the Internet-based system operated by the Department of Homeland Security in partnership with the Social Security Administraion to electronically verify employment eligibility of newly hired employees.

The June 6 order amends Executive Order 12989 (1996) to "promote economy and efficiency in Federal Government Procurement."  According to the amended executive oOrder, "contractors that employ illegal aliens cannot rely on the continuing availability and service of those illegal workers, and will inevitably have a less stable and less dependable workforce."

The specific language of the amended executive order requires all federal agencies and departments that enter into contracts to require, as a condition of each contract, that the contractor agrees to use an electronic employment eligibility verification system (E-Verify).  This applies to: (1) all persons hired during the contract term by the contractor to perform employment duties within the United States on the federal contract.

The amended executive order directs the secretary of Homeland Security to issue rules and regulations to implement the requirements.  According to DHS Secretary Michael Chertoff, the implementing rule (which would amend existing Federal Acquisition Regulations) is being sent to the Federal  Register for publication. This will be followed by a 60-day public comment period. Secretary Chertoff indicated the new system could be up and running later this year.

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The original Executive Order 12989 provided for debarment of federal contractors whenever the attorney general made a determination that a contractor had violated the innigration and Nationality Act's employment verification provisions. The regulations implementing the amended Executive Order will be updated and will presumably make the debarment penalty applicable to federal contractors that fail to use E-Verify. Secretary Chertoff declined to comment on whether subcontractors will also be required to use E-Verify, but it is likely that such a  requirement will be specified in the forthcoming regulations.

While some observers have expressed concerns with the accuracy of E-Verify, Secretary Chertoff claims that the system is a "tremendous success" with approximately 1,000 new employers signing up to use the program each week. At yesterday's press conference, Secretary Chartoff stated that the system can handle an increase in participation prompted by the amended executive order, which could affect "hundreds of thousands of employees and perhaps as many as one million workers" depending on "the number of government contracts over the next few years.

Additional Information
If you have questions about the amended Executive Order and/or its ramifications, please contact the Ogletree Deakins attorney with whom you normally work, or call Client Services at 866-287-2576 or by email at [email protected].

Andrew P. Galeziowski (Atlanta Office)
Lee Gibbs Depret-Bixio (Columbia Office)
Leigh M. Nason  (Columbia Office)

This article was drafted by the attorneys of Ogletree Deakins, a national labor and employment law firm that represents management. This information should not be relied upon as legal advice.

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