Pennsylvania Public Works Contractors Need to Revise Subcontracts to Comply with E-Verify Requirement

Under the Pennsylvania Public Works Employment Verification Act (“the Act”), a new law that takes effect on January 1, 2013, public works contractors and subcontractors working on projects (funded at least in part by a public body) with an estimated value of $25,000 or more, will be required to enroll and participate in the federal E-Verify electronic employment eligibility verification system (“E-Verify”).  E-Verify is an internet based system that confirms the legal work authorization status of newly hired employees by comparing information on the employee’s Form I-9 with records on file with the U.S. Department of Homeland Security and Social Security Administration.  Specifically, as a precondition to being awarded a public works contract, the Act mandates that before the execution of the contract, the contractor and its subcontractors provide the contracting agency with a Verification Form, certifying the contractor’s and subcontractor’s compliance with the E-Verify requirement.    

Contractual Language.   The Act also requires that contracts between a public works contractor and its subcontractors contain information regarding the requirements of the Act.  Thus, it is highly recommended that Public Works contractors revise theirs subcontracts before January 1, 2013 to comply with the Act.    

Enforcement of the Act.  To ensure compliance with the Act, the Department of General Services has been granted the authority to conduct random and complaint-based project audits.  The penalties for failing to comply with the Act include monetary fines and debarment from public work. 

Good Faith Defense.  Notably, the Act contains a “Good Faith” defense clause that shields employers from liability if the employer takes adverse action against a newly hired employee in reliance on an E-Verify determination that the individual is not authorized for employment. 

The attorneys at Harmon & Davies are available to assist public contractors with revising their subcontractors to comply with the Act. 

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