Written By:
David H. Nachman, Esq.
Ludka Zimovcak, Esq.
Snehal Batra, Esq.
Samantha Oberstein, Esq.
Nachman, Phulwani, Zimovcak (NPZ) Law Group, P.C.

Many U.S. employers, particularly in manufacturing, have likely heard of E-Verify. But what exactly is it, and do you need to use it for your business? Let’s break down what E-Verify is and how it could impact manufacturers.

What Is E-Verify?
E-Verify is an internet-based system, managed by U.S. Citizenship and Immigration Services (USCIS) in partnership with the Social Security Administration. It helps employers verify that their newly hired employees are legally authorized to work in the U.S.

While all employers must complete Form I-9 to verify a new hire’s identity and employment eligibility, E-Verify provides an additional layer of security by electronically confirming the accuracy of the information provided.

How E-Verify Works
During the hiring process, employees present documents that establish both their identity and work authorization. When a company uses E-Verify, the system compares this information with data from government records to ensure authenticity. For instance, if an employee provides a state driver’s license, E-Verify checks the details against state records to confirm the validity.

If there is a mismatch between the information submitted and the records in the system, the employer is notified and must give the employee a chance to resolve the issue. If the employee cannot correct the discrepancy, the employer may terminate the employment.

While E-Verify does not shield employers from worksite enforcement actions, it does provide a presumption of good faith when confirming an employee’s work eligibility.

Is E-Verify Required?
For many employers, the use of E-Verify is voluntary. However, in certain situations, its use is mandatory:
State Requirements: Some states, like Florida and Arizona, require most employers to use E-Verify, while others may limit the requirement to public sector employers.

Government Contracts: Employers with federal contracts that include the Federal Acquisition Regulation E-Verify clause must use the system. Additionally, certain contracts at the local and state level may require its use.

STEM OPT Employment: Companies that employ foreign nationals on STEM OPT (Science, Technology, Engineering, and Mathematics Optional Practical Training) are required to use E-Verify to confirm work eligibility.

Manufacturers, especially those with federal contracts, should be aware of whether they are required to enroll in the E-Verify program and ensure compliance.

Best Practices for Manufacturers Using E-Verify
If your manufacturing business decides to use E-Verify voluntarily or is required to do so, implementing internal policies is essential for proper usage. Key best practices include:

Consistency Across the Organization: Use E-Verify for all new hires going forward to avoid any potential claims of discrimination.

Consulting Legal Counsel: Manufacturers with multiple worksites may have flexibility on whether they use E-Verify at all locations. It’s best to consult with an immigration attorney to clarify these options.

Potential Penalties for Misuse
Improper use of E-Verify, such as using the system in a discriminatory manner or continuing to employ individuals who are flagged as ineligible, can lead to penalties. Penalties may include fines, loss of government contracts, or even the suspension of business licenses.

Federal contractors who misuse the program may become ineligible for future federal contracts or face termination of existing contracts.

Why Should Manufacturers Consider Using E-Verify?
Even when not required, using E-Verify can offer several benefits. The system helps manufacturers ensure compliance with U.S. immigration laws by verifying the identity and work authorization of new employees. Additionally, it provides employers with protection against civil and criminal penalties by offering a presumption of good faith in the hiring process.

Finally, using E-Verify can streamline onboarding processes and protect manufacturers from unintentional non-compliance with employment authorization rules.

Future Updates: E-Verify+
In June 2023, USCIS announced plans to introduce a new system, E-Verify+, which will integrate the Form I-9 process directly with E-Verify. This upcoming platform aims to simplify the verification process by allowing new hires to enter their information electronically, automatically completing both Form I-9 and E-Verify. The goal is to reduce the administrative burden on employers and streamline compliance efforts.

More information on E-Verify+ will be available soon, but manufacturers may want to stay informed about these updates to enhance their hiring processes.

Conclusion: Staying Compliant and Efficient
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For manufacturers, understanding E-Verify and its requirements is crucial to ensuring compliance with employment laws. Whether required by law or used voluntarily, E-Verify offers tools to verify that your workforce is legally authorized to work in the U.S.

Contact Information
If you or your family members have any questions about how immigration and nationality laws in the United States may affect you, or if you want to access additional information about immigration and nationality laws in the United States or Canada, please do not hesitate to contact the immigration and nationality lawyers at NPZ Law Group. You can reach us by emailing [email protected] or by calling us at 201-670-0006 extension 104. We also invite you to visit our website at www.visaserve.com for more information.

Written By: 
Dave Patterson
A Neumann & Associates, LLC

“Let’s Wait and See” is never a good strategy in business. Maintaining market awareness, preparing needed changes, and implementing them proactively creates momentum and distinguishes market leaders from the pack. Those who are resistant to change and growing their business place their future at risk. The same is true for owners ready to sell their business. Understanding current Fair Market Value is critical to moving forward with confidence.
In our July 2024 blog, Achim Neumann highlighted factors driving uncertainty for business owners on when to sell their business. If you missed it, read it here. https://neumannassociates.com/mid-term-market-insights-for-business-owners/

The elections in November drive uncertainty. However, it is important to focus beyond the next few months while considering the potential implications of a new White House Administration.

What Will Happen:

• The person in the Oval Office will change.
• Eleven gubernatorial elections will take place, among a total of 164 state executive seats across twenty-nine states.

What May Happen:

• Shifts in the U.S. Congress and Senate could lead to changes in leadership and eventual impacts on Tax and Economic Policy.
• The Regulatory environment could ease or complicate the process of selling a business.
• Overall market confidence may improve, enabling access to capital and investment.

What Will Not Happen:

• There will be no difference in the passage of time… it marches on.
• Your competitors and new entrants will not pause in their efforts to take your market share.
• Investors will not stop seeking to put capital to work in generating returns.

The biggest potential impact on business owners could be the reversion of current federal and lifetime estate and gift tax exemption amounts to pre-2018 limits, which would effectively reduce business seller tax benefits by 50%. Unless diverted legislatively, this “sunset” will occur on December 31, 2025.

During an election year, a “wait and see” attitude is prevalent, but the difference in success between leaders and followers in business is undisputable.

Key Considerations:
Every business owner encounters a series of things that eventually spark the revelation that it is “time to sell my business.”

• They have been leading their company for 20+ years, and now want to do something new.
• Others want to free up cash from their business investment to pursue other interests.
• They have built their business over decades and thought the kids would want to carry it forward but realize that they have no interest.
• Dealing with the challenges of hiring and retaining employees has become a financial and emotional drag.
• The passion for the business has gone, and it requires more effort to maintain the interest to be present.

Selling your business enables you to make a strategic move to what comes next. That may be retirement, or another investment, now, or in the future.
Now, the important points become:

• Is your business ready to sell? Do you understand its Fair Market Value?
• Can you prepare and share the financial and operational information needed by potential buyers while maintaining confidentiality, and without losing customers or employees?
• How do you find qualified buyers and deal with them while running the business?

We bring these elements together and serve as a trusted, confidential resource to you, as the business owner, through this complex process. You are the expert in your business! Our expertise is in the process of preparing you to sell and finding buyers for your business. It’s what we do every day.

Change happens. Timing is everything.
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About A Neumann & Associates, LLCA Neumann & Associates, LLC is a professional mergers & acquisitions and business brokerage firm having assisted business owners and buyers in the business valuation and business transfer process through its affiliations for the past 30 years. With an A+ Better Business Bureau rating, the company has senior trusted professionals with a deep knowledge based in multiple field offices along the East Coast and has performed hundreds of business valuations in its history. The firm’s competitive transaction fees are based on successfully completing transactions. For more information, please contact A Neumann & Associates at 732-872-6777 or [email protected]

Written By:
Stuart M. Brown
Partner
Norman D. Kallen
Partner
Brown Moskowitz & Kallen, P.C.

How should a business respond when it or its counterparty cannot fulfill obligations under an existing agreement or when entering into a new business relationship? There are myriad practical and legal answers to the question. Here, the focus is the application of the concept of force majeure in the context of contractual business relationships.
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The term “force majeure” literally means “superior force.” It is a common clause in contracts that can be used to release or excuse a party to the contract from performance when an extraordinary event or occurrence beyond the control of the parties prevents one or more of the parties from fulfilling its obligations under the agreement. In certain circumstances, rather than completely relieving a party of its responsibilities, the contractual requirement may be suspended during the force majeure event.
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Some courts apply a standard of foreseeability to determine whether an event constitutes a force majeure. In brief, as with most legal issues, the answers to the questions “What constitutes a force majeure event?” and “What is the expected result of successfully proving that an occurrence is in fact a force majeure?” are not clear. There is no bright line. Any position or conclusion is subject to interpretation and challenge.

Practically, a business owner with an existing contract must look at the agreement to determine whether there is a force majeure provision, how force majeure is defined in the provision, whether there are contractual requirements to taking the position that performance is frustrated by a force majeure event and what relief is available under the circumstances. If a contract does not contain a force majeure provision, there may still be remedies for non-performance. However, they are subject to broader interpretation under the common law.

For parties entering into a new agreement, a force majeure provision should be included and carefully crafted to cover a broad scope of events and occurrences and a broad range of remedies. Of course, in this instance, each side may seek a different scope and range. Optimally, an existing or new agreement would contain a force majeure provision modified to reflect the new reality. While some argue that a less specific force majeure clause allows for broader application because not all force majeure events can be listed, the less subjective the provision, the more certain an outcome can be expected. A broad “catch-all” provision can serve the purpose of incorporating instances where a particular event is not included. However, as a risk allocation mechanism, the more specific the list, the stronger the argument in support of the application of the force majeure clause to the non-performance under a given agreement. Neither party can argue that a given event was not anticipated as grounds for granting relief for failure to perform.
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When a contract does not include a force majeure event provision, the parties may still have remedies under the common law under a variety of legal principles. However, the hurdles to be surmounted in proving a common law case are more numerous and the process becomes more burdensome.  A party will likely have to argue that a given event was not foreseeable, was beyond its control, was the proximate cause of the failure to perform and made performance impractical or, even, impossible. The inquiry and arguments become much more complex.

Of course, in addition to reliance on a force majeure provision to seek relief from a counterparty for non-performance, business owners should consider whether there is insurance coverage for losses sustained as a result of a breach based on a force majeure event. In today’s circumstances, all business owners should carefully review and analyze their business insurance policies to ascertain whether there is coverage for damages associated with a force majeure event. Many policies do not cover epidemics, for instance. However, there may be other grounds for coverage. For example, does the policy cover government actions or orders or national emergencies such as arose during the COVID-19 pandemic? Parties seeking new coverage should carefully compare carriers and policies to get the broadest coverage possible.
 
Following are four questions to ask when assessing a force majeure clause:

1. What is covered; epidemics, pandemics, viruses; national or regional emergencies; government orders, etc.? Or, is there a broad “catch-all” provision?
2. When are you required to notify the other party that you cannot perform?
3. Why is performance impossible or impractical?
4. How can damages be mitigated – is partial performance or delayed performance possible?

 
The COVID-19 pandemic taught us that the unforeseen occurs, sometimes on an unprecedented scale.  Whether and how a force majeure clause, common law remedy or insurance coverage applies to any future event is unknown.  The critical point is to prepare: review existing contracts; draft broad force majeure provisions in new agreements; analyze current insurance coverage and/or secure the broadest coverage in new policies.
If you would like more guidance, please contact Stuart M. Brown or Norman D. Kallen at Brown Moskowitz & Kallen, P.C., (973) 376-0909. We will be glad to review your policy and discuss strategies that may be considered.

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This article is for informational purposes only and is not intended to constitute, and does not constitute, legal advice.