“No Match” Letters Return

April 26, 2011

After a three-year hiatus, the Social Security Administration (SSA) recently announced that it will again begin sending “No Match” letters to employers.

These letters are used to advise employers that there is a discrepancy in the records of the SSA between the name of an employee and the Social Security number listed for that employee on the payroll taxes submitted by the employer. The SSA suspended sending out these letters for the past three years during litigation surrounding the Department of Homeland Security’s (DHS) proposed regulation that would have provided a “safe harbor” for employers if they followed certain procedures in responding to “No Match” letters. The DHS has since withdrawn that proposed regulation.

If you receive a “No-Match” letter from the SSA, you should first check your own records to make certain that the problem does not stem from transposing a number or some other clerical error. If that is not the case, you should follow up with the employee to check to make certain that the information that he/she provided to you is correct. If the employee provided the information that is in question, you should inform the employee of the discrepancy and have the employee resolve the issue with the SSA within “a reasonable period of time.” A reasonable amount of time is generally two weeks. After receiving the updated information from the employee, follow up with the SSA to verify any new information or documentation provided by the employee. If the employee fails to provide a satisfactory response, you, as the employer, arguably possess “constructive knowledge” that the employee may not be eligible to work in the United States. Accordingly, at that time the only option may be termination.