Section 401 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA - Public Law 104-208) required the federal government to establish pilot programs to verify the employment eligibility of new hires.
Participation in E-Verify is voluntary and has been available for every business in the country since late 2004.
Step 1 - Under E-Verify, an employer who elects to participate signs a Memorandum of Understanding with the Social Security Administration and the Department of Homeland Security (DHS) that spells out the responsibilities of each party. Then, when an employer hires a new employee, he first satisfies current law by having the employee fill out an I-9 form within three business days of hire.
The I-9 simply states the employee's name, date of birth, social security number, and an attestation that the employee is a United States citizen, lawful permanent resident, or alien authorized to work in the U.S. The employee presents to the employer either one document establishing both identity and work authorization (e.g., a U.S. passport or green card) or two documents that together establish identity and work authorization (e.g., a driver's license and a social security card). The employer examines them to make sure they reasonably appear to be valid (i.e., the photo is not taped on the driver's license) and records the document number, issuing agency and expiration date, if any, on the I-9. Then, the employer signs an attestation on the I-9 saying that he has examined the documents and they appear valid.
Step 2 - Once the I-9 is done, the employer logs onto a secure DHS website, enters the employee's full name, date of birth and social security number. He chooses from a drop-down box which document/combination of documents the employee presented, and then clicks the submit button. The information about the employee is transmitted immediately to the SSA (Social Security Administration).
Step 3 - If the SSN (social security number) and the name match SSA records, the employer receives a message within two or three seconds that the employee is authorized to work and the process is finished.
If the SSN and name match, but the SSA cannot verify that the employee is work authorized (i.e., the SSN may have been issued "not for employment purposes") the employer gets a message that DHS is attempting to verify work authorization. DHS usually responds within 24 hours, but the law gives it three days, since it has to check its records by hand if the automated check does not match the name and immigration document. If DHS finds a match, it tells the employer and the process is finished. Otherwise, the employer is told to have the employee check with DHS directly to clear up the problem.
To Hire or Not to Hire - If the SSN and name do not match, the employer receives a message to refer the employee to SSA to clear up the problem.
In either case where the employee is referred to SSA/DHS, the employer will be notified within 10 days that either work authorization is confirmed or not confirmed, in which case the employer must terminate the employee.