FAQ: Immigration Status & Work

Immigration, Tax, and Labor/Employment Law Intersections

With the likely expiration and/or revocation of temporary statuses previously granted under Executive policy (e.g. parole, deferred action, TPS designation, etc.), VAAP is already receiving lots of questions from economic and workforce development partners, allied employers, economic justice advocates, and local business owners.

Many are seeking clarity about the obligations on employers and employees to prevent and/or redress unauthorized work, as well as liabilities faced by both for noncompliance. VAAP does not specialize in Tax nor Labor/Employment law, nor does it represent employers as a matter of course, but has consulted colleagues to collate the following general legal information.

Accordingly, the following does not constitute legal advice and should be used as a starting point for further research or advice-seeking.

EMPLOYERS’ OBLIGATIONS AND LIABILITIES

Employers in the United States are required by law to verify the identity and employment eligibility of all employees, regardless of their citizenship status. This verification is conducted through the completion and retention of Form I-9, which helps ensure compliance with the Immigration and Nationality Act (INA), specifically section 274A, that governs work eligibility and anti-discrimination rules.

Key Requirements for Employers

Form I-9 Completion and Retention:

Employers must complete Form I-9 for each employee, verifying both identity and work authorization. This includes employees who are non-U.S. citizens, such as lawful permanent residents (LPRs), asylum seekers, and other authorized noncitizens. Employers must retain completed I-9 forms for either three years after the employee’s hiring date or one year after employment ends, whichever is later.

Allowing Document Choice from Lists of Acceptable Documents:

Employers must allow employees to choose from three lists of acceptable documents:

1. List A: Documents that establish both identity and employment authorization, such as a Permanent Resident Card (green card) for LPRs or an Employment Authorization Document (EAD) for other noncitizens.

2. List B: Documents that establish identity only, such as a driver’s license.

3. List C: Documents that establish employment authorization only, such as an unrestricted Social Security card or Form I-94 for asylees.

Employers are prohibited from specifying which documents employees should provide, as this can lead to discriminatory practices.

Verification and Inspection of Documents:

Employers must examine the documents at the time of hiring to ensure they appear genuine and relate to the employee presenting them. For example, asylum seekers may present a valid EAD, while lawful permanent residents may present their green card (Form I-551).

As long as the document appears valid at the time of hiring and is on the Lists of Acceptable Documents, the employer may accept it without needing additional verification.

Re-verification of Expiring Work Authorization Documents:

When an employee presents a document with an expiration date, such as an EAD, employers must re-verify work authorization before it expires. However, documents such as a Permanent Resident Card (green card) or a non-expiring Form I-94 for asylees do not require re-verification unless they explicitly state an expiration date.

Re-verification allows the employee to present any valid document from either List A or List C to show ongoing work authorization.

Anti-Discrimination Compliance in Employee Verification:

Employers must avoid discriminatory practices based on citizenship or immigration status, as required by INA anti-discrimination provisions. This includes treating all employees equally, whether they are U.S. citizens, lawful permanent residents, asylum seekers, or other noncitizens with authorization.

Employers should avoid asking for specific documents based on the employee’s citizenship or immigration status and should ensure that their verification practices are applied consistently across all employees.

Following the Employer’s Handbook (M-274):

The Handbook for Employers (M-274) provides detailed guidance for completing Form I-9 and adhering to INA requirements. Employers should consult this resource to stay informed about their responsibilities and how to correctly verify documents for all employees, including noncitizens.

Employer Liabilities

Employers may face liabilities for non-compliance with work authorization requirements, although prosecution for illegal employment of immigrants is rare. Liabilities include:

Civil Penalties: Employers can be fined hundreds to thousands of dollars, typically increasing with repeat offenses, if they:

Hire or continue to employ individuals who are not authorized to work in the U.S.

Fail to correctly complete, maintain, or update Form I-9 for each employee.

Engage in discriminatory practices by requesting specific documents based on an employee’s citizenship or immigration status, rather than allowing employees to choose from the Lists of Acceptable Documents.

Criminal Penalties: For serious or repeat violations, employers may face criminal charges, including higher fines and possible imprisonment for knowingly employing unauthorized workers. Prosecutions are rare.

Anti-Discrimination Liabilities: Under the Immigration and Nationality Act (INA), employers must avoid discrimination based on citizenship or immigration status when verifying employment authorization. This includes: 

Allowing employees to choose their own documentation from the Lists of Acceptable Documents (Lists A, B, and C).

Ensuring that non-U.S. citizens, such as LPRs or asylum seekers, are not treated differently or required to provide specific documents based solely on their status.

Re-verification Obligations: Employers are responsible for re-verifying the work authorization of employees who present documents with expiration dates, such as an Employment Authorization Document (EAD). However, certain documents, like a Permanent Resident Card (green card) or Form I-94 issued to asylees, do not require re-verification unless they contain an expiration date.

EMPLOYEEs’ rIGHTS, OBLIGATIONS AND LIABILITIES

All work is skilled and all workers have rights. 

• For an overview of workplace rights regardless of immigration status, access the National Labor Relations Board’s one-page handout and their page on Immigrant Worker Rights.

• For an overview of state-based protections from workplace discrimination, visit the Vermont Attorney General’s Office Civil Rights Unit and the Vermont Human Rights Commission who divide responsibiliy for enforcing anti-discrimination protections.

• For humanitarian immigration protections available to cooperating victims of qualifying workplace harms, see

  • U visa information.

  • T visa information.

  • Labor-based deferred action (DALE and DED) information.

• To apply for Vermont victims’ compensation, visit the Vermont Center for Crime Victim Services website.

In the case of employees, noncitizens including lawful permanent residents, asylum seekers, and others with work authorization must also comply with work authorization requirements, including presenting valid documentation to establish identity and work authorization at the initiation of new employment. Examples include:

• Lawful Permanent Residents (LPRs): May present a Permanent Resident Card (Green Card) (Form I-551), which confirms both identity and work authorization.

• Asylum Seekers: May present a Form I-766 (Employment Authorization Document, EAD), or another combination of acceptable documents from Lists A, B, and C.

• Other Authorized Noncitizens: Depending on status, other acceptable documents might include a foreign passport with a Form I-94, or an EAD, among other options in Lists A, B, or C.

Consequences for Providing False or Fraudulent Documents: Presenting false documents or providing incorrect information can lead to:

• Loss of Employment: Employees found to lack valid work authorization may be terminated by their employers.

• Criminal or Civil Penalties: Although rare in practice, individuals could face fines or criminal liability for using fraudulent documents to work without authorization.

• Impact on Immigration Status: Unauthorized work or fraudulent documentation can affect a noncitizen’s immigration record, potentially harming future applications or renewals for family- or employment-based immigration pathways (e.g. a spouse or employer sponsoring someone for a green card). However, humanitarian-based immigration status seekers are typically exempt from adverse immigration consequences due to unauthorized work and/or can seek a “waiver” of any resulting "inadmissibility” or bars to status. 

Re-verification Responsibility: Employees who provide expiring work authorization documents (such as an EAD) should be prepared to present updated documentation when required by their employer. However, LPRs and asylees with documents that do not expire, like a green card or a non-expiring Form I-94, do not need to provide updated documents.

earning income as a business owner

General consensus interprets that owning a business or practicing a trade is not “employment” under the Immigration and Nationality Act, and federal and state laws create mechanisms for earning income and encouraging investment in these ways. In fact, immigrants represent a disparately large share of business owners in the United States. 

Learn about paying taxes with an Individual Tax Identification Number here.

Learn about registering a business in VT here.

Learn about status-neutral professional licensure to practice a VT regulated trade here.

Read VAAP’s testimony on Act 105 (2024) here.