Chamber Files Legal Challenge Against DHS ?Social Security No-Match? Regulation

Sunday, September 9, 2007 - 8:00pm

WASHINGTON, D.C.—The U.S. Chamber of Commerce today joined with other business organizations in intervening in a legal challenge against the Department of Homeland Security's (DHS) so-called "Social Security No-Match" regulation issued on August 15. The regulation imposes new, onerous procedures that employers must follow if they receive letters from the Social Security Administration (SSA) that social security numbers used by their workers do not match the records in the SSA database.

"The Chamber is intervening in this challenge primarily because DHS did not comply with the requirements of the Regulatory Flexibility Act when it concluded the new regulation would impose no "new or additional costs" on employers. This is clearly wrong," said Robin Conrad, executive vice president for the Chamber's National Litigation Center. "At the very minimum, employers would have to expend significant amounts of time and effort simply to understand the regulation and to train their human resource professionals on how to handle "no-match" letters when they are received."

The Chamber's lawsuit also alleges that the DHS exceeded its statutory authority and failed to comply with the Administrative Procedure Act in issuing the regulation. The suit intervenes on behalf of a lawsuit filed last week by the AFL-CIO, several California labor groups and the ACLU, which argued that because of errors in the SSA database, many American citizens could be fired because of this new regulation. Judge Maxine M. Chesney of the U.S. District Court for the Northern District of California granted the AFL-CIO's temporary restraining order and temporarily halted the implementation of the new enforcement measures by DHS.

From the business perspective, if left unchallenged, the regulation will create considerable compliance costs, particularly in light of the fact that the agency estimates that 140,000 letters will be sent to employers identifying multiple names including almost nine million mismatches. Further, employers cannot simply ignore this regulation because doing so would expose them to claims that the employer knowingly hires undocumented workers.

Every year the Social Security Administration receives millions of earnings reports that Social Security cannot match with its records by name. The agency estimates that its database contains more than 255 million unmatched records. However, there are many other reasons why social security numbers do not match the SSA records. These could include typographic errors, name changes, and hyphenated names having nothing to do with an employee's authorization to work.

The U.S. Chamber is the world's largest business federation, representing more than 3 million businesses and organizations of every size, sector and region.

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