I-9 Audits Are Up 40%: Is Your HR Team Prepared?

The federal government's appetite for I-9 enforcement has shifted dramatically, and HR teams that have treated employment eligibility verification as a paperwork formality are discovering the cost of that assumption the hard way. Immigration and Customs Enforcement issued Notices of Inspection, the formal document demand that initiates an I-9 audit, at a rate 40% higher in fiscal year 2025 than in 2024, according to agency enforcement data. The increase spans sectors, but manufacturing, agriculture, hospitality, and construction organizations are receiving the highest concentration of inquiries.

The financial stakes have also changed. Annual civil monetary penalty adjustments under the Federal Civil Penalties Inflation Adjustment Act have pushed I-9 fine ranges to levels that create material business risk for any organization with significant headcount. Substantive violations, meaning errors in completing or retaining I-9 forms, now carry fines of $281 to $2,789 per form for first-time violations, with penalties for repeat offenders reaching $27,894 per individual form. For an organization with 500 employees and a 15% error rate on its I-9 forms, a rate that immigration attorneys describe as typical for organizations that haven't conducted a recent self-audit, the fine exposure runs into the hundreds of thousands of dollars.

"Most of the organizations we work with after receiving an NOI have never done a systematic I-9 audit," says Elena Marsh, an immigration attorney at Fragomen. "They assume that because they use E-Verify and process I-9s at onboarding, they're compliant. But process compliance and document compliance are different things, and the gap between them is where most violations hide."

The Three Violations Attorneys Are Seeing Most Often

The first and most common violation is expired document acceptance. I-9 regulations require that employees present unexpired identity and work authorization documents at the time of initial hire. Documents that appear valid but have actually expired, such as List A documents with passed expiration dates that a rushed onboarding specialist didn't catch, are a frequent finding in audit reviews. The issue is compounded for organizations that completed I-9s remotely during the COVID-era flexibility period: the DHS's authorized remote inspection period ended in August 2023, and any I-9s completed under that accommodation should have been re-verified through an in-person review process by the compliance date. Organizations that missed that re-verification deadline have an unresolved exposure that will surface in any audit.

The second common violation is Section 2 timing errors. Federal regulations require that the employer complete Section 2 of the I-9, which documents the employer's review of the employee's documents, no later than the first day of employment. In practice, HR teams at organizations with high-volume hiring often fall behind on this documentation, completing forms days or weeks after the hire start date. Those timing errors are clearly visible on the form and are consistently cited as violations in enforcement actions.

"An I-9 self-audit is one of the highest-ROI compliance investments an HR team can make. A day's work by a qualified specialist can identify and correct years of accumulated exposure — and the fact that you conducted the audit and corrected errors is a meaningful mitigating factor if an NOI does arrive." — Elena Marsh, Partner, Fragomen

The third category is E-Verify mismatch resolution failures. E-Verify generates a Tentative Nonconfirmation (TNC) when its database check can't immediately confirm an employee's work authorization, most commonly due to a name discrepancy, a document number that hasn't been updated in SSA records, or a recently issued document that hasn't propagated to federal databases. Regulations require that employers notify employees of a TNC and provide an opportunity to resolve it through a formal referral process. Organizations that dismiss TNCs without following the required referral protocol, or that take adverse employment action against employees before the resolution period expires, are creating significant liability exposure in addition to the technical compliance violation.

The Self-Audit Process: A Practical Guide

• Pull your complete I-9 roster: every active employee and any terminated employee whose I-9 must still be retained (three years from hire date or one year from termination, whichever is later).
• Check for missing forms first. Any employee without an I-9 on file is a substantive violation regardless of how the form would have been completed. Address missing forms immediately with the appropriate corrective documentation.
• Review Section 1 completeness: employee signature, date, attestation of status, and, for temporary work authorization, the expiration date. Missing or blank fields in Section 1 are among the most common technical violations.
• Review Section 2 for timing compliance and document validity. Check that each form lists the document type, document number, and expiration date correctly for each document reviewed, and that dates align with the first day of employment.
• Run E-Verify compliance checks for any employees hired after E-Verify was implemented for your organization. Confirm that every hire has a case number and that any TNC cases were resolved through the proper referral process.
• Document your audit in writing, including the methodology used, errors identified, corrections made, and legal review obtained. This documentation is your affirmative defense in any subsequent enforcement action.

Immigration attorneys uniformly recommend conducting I-9 self-audits before receiving an NOI rather than after. Organizations that have an audit trail demonstrating proactive compliance review are treated meaningfully better in penalty negotiations than those who present no evidence of prior compliance attention. The investment in a qualified specialist, either internal HR staff with current I-9 training or outside immigration counsel, is typically recoverable in penalty reduction alone in the event of an audit, and in the substantial cost of a rushed correction process under enforcement pressure.