The Return of the “No-Match” Letter
The last time a client of mine received a “No-Match” letter was in 2012, so I was somewhat surprised when multiple clients received letters from the Social Security Administration in only the last few weeks. Apparently, my clients were not alone. According to a New York Times story, over half a million employers received similar letters in the last couple of months.
The new “No-Match” letters start out with “You reported [some number] employee names and Social Security numbers (SSN) on the Wage and Tax Statements (Forms W-2) for tax year 2018 that do not match our records.” The letters do not identify the employees in question, but an employer that wants to know who is on the list can request a report from Business Services Online. However, the letters also warn employers against taking any adverse action against an employee whose name appears on the list.
One client asked me: “Should I just do nothing?” While the Social Security Administration has no authority to penalize employers for reporting incorrect information, I have recommended against taking the “ostrich” approach to these letters. While there can be good reason for a mismatch (a name change, a typographical error, or identity theft), it is also possible that the employee was not authorized to work and originally presented a stolen or fraudulent Social Security card. If a letter refers to a significant number of mismatches, I think there is a fair chance that the employer may soon become the subject of an I-9 audit or, worse yet, an ICE raid.
So what should an employer do? At a minimum, an employer should notify any identified employee that they have been identified as a possible mismatch. Ask the employee to confirm his number, and if the number is incorrect, ask to see the employee’s card. If the employee insists that you have the correct number, you may want to tell him to check with the local Social Security office to resolve the issue, and let you know what they find out. After all, this could ultimately affect his entitlement to retirement or disability benefits.
If the issue is not resolved, there is probably not much that an employer can do without risking a claim of discrimination. However, if the employer can demonstrate with documentation that it made an effort to investigate each “No-Match,” it is unlikely that the government will charge it with constructive knowledge of having employed persons who were not authorized to work.
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This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.