New E-Verify Notices Put Federal Contractor Compliance in the Spotlight

Certain federal contractors are beginning to receive email notices from E-Verify identifying potential discrepancies related to their compliance with the Federal Acquisition Regulation (FAR) E-Verify requirements. The emails, entitled “Notice of Potential Compliance Discrepancy – FAR 52.222-54, Employment Eligibility Verification (E-Verify),” provide employers with only seven calendar days to respond. Sample notice is here. 

These notices are significant not only because of the short response period, but also because they appear against the backdrop of a multi-year federal effort to improve oversight of federal contractor E-Verify compliance.

What are the new E-Verify notices?

According to emails received by employers in late September, E-Verify states that it is examining active federal government contracts to determine whether contractors are meeting applicable E-Verify FAR requirements. Since 2009, certain federal contracts include the FAR E-Verify clause, which generally requires covered federal contractors to enroll in E-Verify and use the system to confirm work eligibility of new hires and employees assigned to the federal contract. Specific requirements and timeframes vary depending on the contractor’s circumstances.

Against that backdrop, these new notices advise employers that government records indicate one or more potential discrepancies, including:

• The contractor is not enrolled in E-Verify, or its E-Verify profile does not identify it as a Federal Contractor with the FAR E-Verify Clause;

• The contractor's E-Verify profile is missing an Employer Identification Number (EIN) and/or Unique Entity Identifier (UEI), or the information does not match federal contracting records; or

• E-Verify records do not appear to show required E-Verify cases for covered employees performing work under the federal contract.

Notably, the notices do not appear to identify which of these potential discrepancies prompted the inquiry. Also, the specific contract and contracting entity does not seem to appear in the standard emails. 

What do the E-Verify notices request? 

Employers receiving a FAR compliance notice are asked to review their E-Verify enrollment, company profile, federal contracting information, and case activity, and respond within 7 calendar days. The response could either describe any corrective actions taken, or if the employer believes the government’s records are inaccurate by possibly explaining the discrepancy. 

The notices also warn that if E-Verify does not receive a response within seven calendar days, or the response does not demonstrate compliance, the matter will be referred for additional government review, including review by the contracting officer for appropriate next steps. 

What is the broader context for these new notices? 

The new notices follow several years of federal efforts to strengthen how FAR E-Verify compliance is monitored. In October 2023, the U.S. Government Accountability Office (GAO) issued a report examining federal agencies' use and oversight of the FAR E-Verify clause. GAO found that monitoring practices varied among the agencies it reviewed and that government data did not always provide an accurate picture of contractor compliance.

Among other things, GAO indicated that USCIS had discontinued reports previously provided to federal agencies because of data-quality concerns. GAO pointed to difficulties matching employer names across databases, duplicate E-Verify accounts, and challenges associated with matching E-Verify and federal procurement information. GAO also discussed E-Verify’s transition from the Data Universal Numbering System (DUNS) to Unique Entity Identifiers (UEIs) as an additional complication in matching contractor records.

GAO ultimately recommended that USCIS develop an approach to collect better information about federal contractors enrolled in E-Verify and then develop a method for communicating quality information to agencies so that they could better monitor contractor compliance.

Those recommendations remain particularly relevant today. According to GAO's current recommendation tracker, USCIS reported that it was working to implement both recommendations with an estimated completion by September 2026.

The federal “data crosswalk”

By January 2025, those efforts had begun to take a more concrete form. The Office of Federal Procurement Policy (OFPP) issued guidance encouraging federal agencies to improve the accuracy of information concerning the FAR E-Verify clause.

Of particular interest, the guidance explained that accurate and timely reporting of the E-Verify clause in the Federal Procurement Data System was important because it would enable USCIS to perform a “data crosswalk” to identify covered contractors that may not have taken the required steps to enroll in and use E-Verify.

The guidance also directed additional attention toward the accuracy of federal procurement data and contractor enrollment and use of E-Verify.

That history may provide context for the emails now being sent by USCIS. The notices appear consistent with the type of comparison between federal contracting and E-Verify information contemplated by the 2025 guidance. However, as of this writing, it does not appear that USCIS has explained whether these particular notices are the result of that initiative or otherwise described how contractors receiving the notices were identified.

What should employers consider if they receive an E-Verify FAR compliance notice?

Given the seven-calendar-day response period, employers receiving one of these new notices should consider beginning their review promptly. Here are a few steps to consider:

(1) E-Verify Account Review. Because the notice may not identify the particular contract, entity or employee population involved, an initial step may be to review applicable federal contracts with the E-Verify FAR clause alongside the organization's E-Verify accounts. As part of that review, employers may want to confirm the relevant contracting entities and identify which E-Verify accounts correspond to those entities. They may also compare information such as legal names, employer identification numbers (EINs), and UEIs against federal contracting records.

(2) Account Configuration. Once the relevant E-Verify accounts have been identified, employers may wish to confirm whether they are designated as Federal Contractors with the FAR E-Verify Clause and the scope of participation (e.g., new hires + assigned contractors; assigned contractors only (for certain entities); or entire workforce). 

(3) Documentation from E-Verify Employer Agents. Organizations that use an E-Verify Employer Agent, including those who use electronic I-9 software, may request the agent provide information to help answer the questions above, including applicable E-Verify Memoranda of Understanding (MOUs) and E-Verify Company Profile information showing the employer name, EIN, and UEI data as applicable. 

(4) Assessing whether an issue exists. As the GAO report indicated, USCIS previously had challenges matching E-Verify information with federal procurement data due to discrepancies in employer names across databases, duplicate E-Verify accounts, and difficulties associated with UEI information. Entity structure can present another complication. A contracting entity may participate in E-Verify through a parent company or another related E-Verify account. Indeed, the new E-Verify notice itself contemplates this possibility by allowing contractors to provide information concerning a parent company's E-Verify account when explaining an apparent discrepancy.

These issues do not mean that every notice is the result of a data mismatch. Some notices may identify genuine regulatory concerns. They do, however, underscore why employers may need to scrutinize and review their records before drawing conclusions about what prompted the notice.

(5) Preparing a response. Given the short response period and the notice’s warning of possible referral for additional government review, employers may wish to work with immigration counsel and their federal contracting teams to evaluate the potential discrepancy, determine whether correction is necessary, and identify what response (and possible records) are most appropriate. 

Conclusion

The new E-Verify FAR notices arrive at a time when the federal government has been working to improve its ability to monitor federal contractor participation in E-Verify. The 2023 GAO report highlighted limitations in the government's existing data, while subsequent federal guidance specifically contemplated using improved procurement information to help USCIS identify contractors that may not have properly enrolled in or used E-Verify.

Whether the latest notices represent the next phase of that effort remains to be seen. But for federal contractors with the E-Verify clause, enrollment and proper use of the system are more than administrative requirements. It is often a contractual obligation tied to doing business with the federal government.

The possibility of additional government review, including by the contracting officer, highlights the potential significance of these notices and the importance of understanding and appropriately addressing any potential deficiencies.

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