U.S. Immigration and Customs Enforcement (ICE) has quietly revised its Form I-9 inspection fact sheet for the second time this year. The August 31, 2026 revision changes inspection procedures, adds a notice on employees’ work authorization, and modifies penalty calculations—changes that could increase employer exposure during an investigation.
The latest revision follows ICE’s March 16, 2026 update, which reclassified 17 common Form I-9 errors from correctable technical failures to substantive violations carrying penalties of $288–$2,861 per form. As discussed in our April 2026 advisory, that update replaced guidance in the 1997 Virtue Memorandum without notice in the Federal Register.
ICE again revised the fact sheet with no announcement, redline, or change log. Although the August version does not reclassify additional violations, it makes several procedural changes employers should understand.
Electronic Audit Trails Take on Greater Importance
The August revision adds the phrase “with a compliant audit trail” to the basic electronic Form I-9 retention standard.
A systemwide audit-trail deficiency could affect every electronically completed form, potentially allowing ICE to seek maximum per-form fines across an employer’s records. ICE has pursued this approach in prior inspections.
Employers that use electronic Form I-9 platforms should confirm with their vendor that their audit trails satisfy 8 C.F.R. § 274a.2(e)–(i).
New Notice Adds Another Element to E-Verify
The revised fact sheet introduces a “Notice of Expired or Rescinded Immigration Status and/or Employment Authorization.” ICE may issue the notice during an inspection to inform an employer that employees have lost work authorization since the audit began. According to the fact sheet, the notice is limited to the inspection process and “does not allege wrongdoing.”
E-Verify raises a separate concern. The Department of Homeland Security (DHS) has developed and expanded the status change report to flag revoked employment authorization documents (EADs), including temporary protected status, asylum, and adjustment-of-status applications. The department has instructed employers to reverify immediately.
E-Verify and its memorandum of understanding (MOU) were designed for hire-time verification, not ongoing monitoring. In addition, the required E-Verify training has instructed employers only to use E-Verify for newly hired employees. Since spring 2025, however, the Administration has repurposed E-Verify to issue revocation notifications.
If ICE later treats an employer’s failure to act on a status change report as evidence that the employer knew an employee lacked work authorization, continued employment could result in penalties of $716 to $5,724 per individual and potential criminal exposure.
The status change report therefore may establish a record before an inspection, while the new ICE notice may document the issue during an inspection. Employers that use E-Verify should establish procedures to generate and review these reports regularly.
ICE Restricts the Use of Warning Notices
A warning notice generally allows an employer to correct a Form I-9 violation without paying a fine. It is unavailable when the employer has a prior enforcement history, uncorrected technical failures, or evidence of fraud.
The March fact sheet stated that warning notices “should not” be issued in those circumstances. The August revision states that they “will not” be issued, apparently eliminating discretion for ICE auditors.
Employers with a prior warning notice or notice of intent to fine (NIF) should prepare for the possibility that the next inspection will lead directly to fines.
Other Changes Could Affect Penalties and Hearing Deadlines
The August revision makes three other significant changes:
- Separate penalty calculations. Violation percentages will be calculated separately for paperwork violations and knowing-hire violations, potentially leading to higher total penalties.
- Tighter hearing deadline. Requests for hearings before the Office of the Chief Administrative Hearing Officer (OCAHO) must be received by ICE within 30 days—not merely mailed within that period. If the deadline is missed, ICE may issue a final order with an opportunity for appeal.
- Statutory authority. The August revision adds that fines “are set by statute and are subject to annual adjustments for inflation,” likely anticipating Administrative Procedure Act (APA) challenges.
Questions Remain About the Revisions’ Legal Effect
ICE implemented both the March and August changes through website postings, without the APA’s notice-and-comment period.
Reclassifying violations to eliminate the statutory cure right under INA § 274A(b)(6)(B) arguably constitutes a substantive rule change requiring a formal process. OCAHO has held that ICE is bound by its own published guidance (WSC Plumbing, 9 OCAHO no. 1071). No APA challenge has been litigated yet, but the basis is available and, in our view, meritorious. Compliance now does not preclude a challenge later.
Steps Employers Should Take Now
- Audit electronic Form I-9 audit trails. Confirm 8 C.F.R. § 274a.2(e)–(i) compliance with your vendor.
- Monitor E-Verify status change reports. Inaction risks knowing-violation exposure.
- Recalculate potential penalties. Evaluate exposure using separate calculations for paperwork and knowing-hire violations.
- Track hearing deadlines carefully. Ensure that ICE receives any hearing request within the required 30-day period.
- Archive each version of the fact sheet. Maintain copies because ICE may revise without notice.
- Consult counsel before an investigation. Review compliance procedures before receiving a notice of inspection.
Please contact our Immigration Team for assistance reviewing Form I-9 practices, assessing penalty exposure, or preparing for an ICE inspection.
If you have any questions, or would like additional information, please contact one of the attorneys on our Immigration team.
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