Social Security "No Match" Letters

The Social Security Administration (SSA), as part of its mission, is charged with maintaining a massive database of employee wage records for future benefits calculations.

The SSA routinely sends employers what are termed "No Match" letters when a W-2 is submitted with a name/number mis-match. Anecdotal evidence in our office suggests that a large number of these letters were mailed to employers in the September/October time frame.

Employers are required to confirm the employment eligibility of new-hires using an I-9 Form before they start work. Many employers wrongly interpret a "no match" letter to indicate the employee is an undocumented alien with a bogus Social Security Number (SSN). They worry that they will run afoul of immigration laws, and some even dismiss the employee.

It is important to understand WHAT the "no match" letter means, how to handle it, and most importantly how NOT to react in such a manner that leaves the employer open to legal penalties.

The SSA posts advice to employers on how to handle a "no match" letter at its website.

A "no match" letter is not a notice of violation of immigration law or tax law. "No matches" occur for a variety of reasons. Marriage or divorce may have occurred and SSA records not updated, there could be a clerical error on the part of the employer submitting the W-2 or the SSA in its handling of the W-2, the employee may have provided an incomplete name or SSN, or the SSN may be fictitious. The purpose of the "no match" letter is to keep the SSA's database accurate and up to date, not enforce immigration or tax laws.

The Department of Homeland Security became involved in this issue in June when it issued a proposed rules change, Safe Harbor Procedures for Employers Who Receive a No-Match Letter, tasking employers to re-check the documents of millions of workers with mismatched Social Security numbers – and fire those who cannot resolve the discrepancy in 60 days. This proposal has NOT been enacted and we expect the issue will be litigated as some point. An employer who relied on employee documentation (Social Security Card for example) that they believed accurate that was later shown to be fraudulent is caught in the middle. On the one hand they face penalties for knowingly employing an illegal alien, on the other hand they are prohibited from firing the employee solely on the basis of the "no match" letter.

Many employers are being proactive by increasing the background checks they do on new hires to include a Social Security Number trace as part of a criminal background check. The SSN trace is a standard component of a 4nannies.com Nanny Pre-employment Background Check.