Watch out for Social Security “No-Match” Letters

10 December 2018 Labor & Employment Law Perspectives Blog
Authors: Kamran Mirrafati

The Social Security Administration (SSA) recently announced that, by spring 2019, it will begin notifying each employer (and third-party payroll company) that has submitted at least one Form W-2 that contains name and Social Security Number (SSN) combinations that do not match the agency’s records.  These Employer Correction Notices have been commonly known as “no-match” letters.

“No-match” letters are not a new practice for the SSA — they initially began sending them back in 1993.  However, many employers were confused as to how to address the letters and whether they could be construed as evidence of unauthorized employment. This led to certain regulations and inevitable litigation. The Obama administration ultimately suspended all such SSA communications in 2012.

There are a number of reasons why reported names and SSNs may not match SSA records — many of which have nothing to do with whether an employee is undocumented. For example, any of the following issues could generate a letter: (1) input errors by the SSA, (2) reporting errors by an employer or employee, (3) identity theft, (4) errors in hyphenated or multiple last names, or (5) an unreported name change.

For this reason, employers should not use a “no-match” letter to take any adverse action against an employee. In fact, the letter contains this clear warning to employers (emphasis added):

You should not use this letter to take any adverse action against an employee, such as laying off, suspending, firing, or discriminating against that individual, just because his or her SSN or name does not match our records. Any of those actions could, in fact, violate State or Federal law and subject you to legal consequences.

Notwithstanding the foregoing, immigration officials could regard an employer’s failure to act on such a letter as evidence of constructive knowledge of unauthorized employment.

We have previously provided detailed guidance on how best to balance these competing interests when addressing these notices — that guidance remains relevant today. It is important to check if the employer’s information matches the information on the employee’s Social Security card. If it does not match, the employee should be asked to provide the exact information as it is shown on the employee’s Social Security card and to check with any local Social Security office to resolve any discrepancies.

Employers should contact counsel throughout this process to ensure any discrepancies are addressed in a non-discriminatory fashion.

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