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USCIS is using new I-9 forms starting January, are you in compliance!?

(ENTREPRENEUR NEWS) January 2017 brings changes to the I-9 form, alongside the increased penalties for non-compliance regarding their completion and retention just enacted in August 2016. Now’s the time to take a look at what’s different.

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What’s new?

With January 2017 bringing changes to the I-9 form, alongside the increased penalties for non-compliance regarding their completion and retention just enacted in August 2016, it’s a good time to take a look at what’s different, as well as the possible ramifications if you’re not completing them correctly.

Changes to the form I-9

The current I-9 form doesn’t look like a technically complex document, but it’s got the potential for both the new employee and the HR professional assisting them to make costly mistakes. The new revisions attempt to address many of the sources of common errors, all of which can lead to fines for the employers. Revisions include:

Information Verification Assistance: Select fields of the new I-9 form will have tools in place to ensure that numerical information (such as Social Security numbers or dates) are entered correctly, by using calendars and drop-down menus to provide information. QR codes are also now generated for each form once printed to allow for ease of tracking documents in audits.

Document Aids: The new I-9 will have instructions embedded within the document to assist users in knowing exactly what to do. These will be supported by intuitive spots that allow the user to access the instructions on demand, as well as print and clear the form, as desired. HR professionals will appreciate the addition of an area that’s solely dedicated for the entry of required information, such as Temporary Protected Status or Optional Practical Training extensions, which is now currently placed in the margins, lacking a permanent place.

Substantive Changes:  There are several substantive changes in addition to the cosmetic ones.

Section 1 changes to provide additional space to enter the names of multiple preparers and/or translators, along with an affidavit statement if the employee didn’t use any assistance in completing their I-9. Additionally, the requirement that employees use all other names has been changed to only reflect the need to provide all other last names. Finally, immigrants are no longer required to provide their I-94 Form number and their foreign passport information.

Section 2 provides a new “Citizenship/Immigration Status” field.

Instructions have also been separated from the form. These are still required to be provided to the employee when filling out the I-9 form. Although there are a great number of electronic enhancements to the form, it does not yet meet the definition of an electronic I-9 as found under the law. Employers will still be required to have the new employees complete the form, print it, and obtain a hard signature.

Why do I care?

Because ignorance is expensive, and lack of compliance with this requirement can not only be costly, but can prevent your business from being able to bid for government contracts or receive federal benefits.  Not enough?

If employers responsible for ensuring the completion of the forms are found to have falsified documents or otherwise acted in bad faith, you can go to jail.

How expensive? New penalty schedules placed into effect by the Justice Department raise the minimum fines for paperwork violations from $110 to $216 and maximums to ten times that amount, jumping from $1,100 to $2,156. These penalties are for each incorrect I-9 form. For those companies which choose to knowingly hire undocumented workers, first offender penalties now range from $539 to $4,313 per employee. For companies who have done this more than once, or who show a pervasive pattern of hiring ineligible employees, fines now range from $6,469 to $21,563 for each ineligible employee hired.

“It is more important now than ever for companies big and small to make sure they have effective policies and procedures in place for properly ‘I-9ing’ employees during the onboarding process,” said Mitch Wexler, an immigration attorney speaking to the Society for Human Resource Management on the issue.  “This includes a regular review of existing I-9s and training staff that touch this critical function.”

Ok, so that sounds bad, but what’s the real risk? In 2013, Immigrations and Customs Enforcement (ICE), the federal agency responsible for enforcement of the correct completion of I-9 forms, levied over $15 million in fines to nearly 700 companies for their lack of compliance, along with the arrest of 179 employers for their complicity in falsifying or incorrectly completing the I-9 forms.

This is a problem that can quickly spiral out of containment for you once an audit happens, even for seemingly minor clerical mistakes.

What should I do?

While the completion of the I-9 document may seem like a trivial detail, it’s obviously one that can cause you to meet a significant pain point if not done correctly and in time.

Know Your Responsibilities
Knowing the basic requirements and the retention schedules will go a long way towards ensuring that you don’t run afoul of the law. Let’s review:

  • You have to do it: I-9 forms are required to be completed at any time you hire someone in exchange for wages or items of value (such as food or lodging). The requirement is applicable to employees hired after November 6, 1986. For employees hired before that date and who have been continuous in their employment and the expectation of continued employment, the requirement doesn’t apply.
  • You have to do it fairly quickly: The I-9 form must be completed in a timely fashion. Employees must complete Section 1 at the time of hire, which is the first day of employment. They can fill out Section 1 at the time that you make the job offer, and they accept but not sooner. As the employer, you’ve got to review the employee’s document selection from Columns A, B, or C and complete Section 2 within three business days of hire. This isn’t negotiable. If they can’t provide you those documents, or if you can’t get to Section 2 within three business days, they shouldn’t be working. If you’re new employee is a hire for fewer than three business days, then Sections 1 and 2 must be completed at the time of hire.
  • You have to know what documents are required: The employee’s responsible for showing you original, unexpired documents that establish their identity and employment authorization. The employee has the right to choose what documents they present to you. They must provide one from List A (identity and employment authorization), or one from List B (identity only) and one from List C (employment authorization only). For E-Verify participants, only List B documents with a photograph are acceptable.

This process needs to be done face-to-face with the new employee; federal regulations require that the new employee be physically present with the examiner during the review of documents.

All documents presented must be authentic and unexpired. You may copy the documents that the employee provides to you, but you must do it for all of your employees, regardless of their citizenship status or nation of origin.

  • You have to keep them handy: The I-9 form must be kept separately from the employee’s personnel file, and must be retained for as long as the employee works for the company. Once they’ve moved on, the retention rules shift; you must determine the later of these two conditions: three years after hire date, or one year after the day that the employee terminates employment. I-9 forms can be maintained in multiple formats (paper or electronic), but must be accessible for review and audit.

Don’t be sketchy

Acting in bad faith is a quick path to see fines increased to the maximum and run the real risk of going to jail. If you find yourself in a situation that tempts you to alter dates, forge signatures, or hire those without proper documentation, think long and hard.

While a federal audit might be years in coming, or never come at all, is this the type of business practice that you want to maintain? Is that who you are?

Be careful of allowing even small ethical lapses slide into your business practices; what’s a small intentional oversight in this corner today can easily be spread to others tomorrow.

Furthermore, that teaches your employees that it’s acceptable to cut corners, and once that attitude festers and takes root, it’s nearly impossible to predict the amounts of damage that it can cause.

Train, train, train and audit, audit, audit

Make certain that the trained staff who handles these documents are also well-trained on their responsibilities and the proper procedures to take when completing them. The U.S. Citizenship and Immigration Services (USCIS) department has wonderful training aids to assist in ensuring that your employees know what to do, and the Society for Human Resource Management is a resource for FAQ and good practical, in-the-trenches advice on pitfalls and scenarios that HR professionals face daily.

Beyond training, ensure that you take the time as a part of your annual HR calendar to set a time to perform a self-audit of current and stored I-9 files.

By making certain that you’re well trained on how to properly complete these forms, and taking the time on a regular basis to self-identify and correct any mistakes on forms, you’ll be moving towards full compliance and have nothing to fear in case of that eventual audit.

#I9

Roger is a Staff Writer at The American Genius and holds two Master's degrees, one in Education Leadership and another in Leadership Studies. In his spare time away from researching leadership retention and communication styles, he loves to watch baseball, especially the Red Sox!

Business Entrepreneur

What’s the difference between an accelerator and an incubator program?

(ENTREPRENEUR) When considering your options for growing your startup, do you know how an accelerator differs from an incubator? The differences are bigger than many realize…

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There are now more options than ever when it comes to applying to as well as choosing the best startup accelerator or incubator.

For those of you who may be new to the startup world (welcome!), I’ve compiled some helpful information to determine the difference between an accelerator and incubator, and which one might be best for your company.

Yes, all programs tout value to burgenoning businesses such as business plan assistance, introduction to other founders and mentors, and most importantly, guidance on fundraising to VCs and angels. But what’s the difference? Here’s the lowdown:

Incubators:

Incubators are built specifically for founders that are at the initial stages of starting their companies and don’t have set program timelines.

Unlike accelerators, incubators operate on a less structured time schedule with less programming and resources, and it’s not uncommon for a company in an incubator program to last for several months or even years.

Incubators typically offer their portfolio companies free office space, business plan advice, and mentorship.

The incubator may offer assistance in introducing your company to potential investors, but it’s not always the main purpose of the program (whereas the majority of accelerators have “demo days” where founders specifically pitch to potential investors).

Incubators are especially popular in local economies and can be run by organizations like non-profits, civic organizations, co-working spaces, and universities. Since incubators have less of a time requirement and offer less resources, you’ll only need to commit to a small amount of equity, often around 1%.

Accelerators:

Accelerators are more focused, time-intensive structured programs for companies with a proof of concept/minimum viable product (MVP) and market validation.

Accelerators do just that: accelerate company growth for startups with proven potential to exit (either eventually sell or go public). Because of this, accelerator interview processes are typically extensive and competitive.

Most programs can last anywhere from 10 weeks to 3-4 months. With many top accelerators, you’ll be expected to move to the city where it’s hosted and spend 40+ hours a week minimum in their dedicated coworking space, and several accelerators offer housing stipends to make the move easier.

These programs typically conclude with a demo day to pitch your product to a variety of community leaders, angel, and institutional investors.

Many accelerators are industry-agnostic, but some specialize in specific industries such as The Brandery or Comcast LIFT Labs.

Accelerators offer exclusive access to investors, web hosting credits, other perks, and special access to program mentors as well as program alumni.

Because of this, the equity required is often somewhere in the range from 3% to 6%.

Y Combinator, one of the most prestigious accelerators in Silicon Valley, invests $150,000 in each startup in addition to its program for a 7% equity stake.

Overall, incubators and accelerators can offer extensive value for founders, but make sure to research carefully when choosing a program. Next up, we’ll talk about choosing the best accelerator for your company and founding team, so stay tuned!

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Business Entrepreneur

Entrepreneurs: You’re unemployable in your own company, must define your role

(ENTREPRENEURS) Once you’ve built a successful business, it’s time to reexamine your role and determine where you fit in best.

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In my experience, most entrepreneurs are “accidental entrepreneurs.” They happened to be good at something, or they had a unique one-time opportunity to provide a product or service to the market. Then years later, they wake up one day and realize that they’re running a big business.

As an entrepreneur, one of the unintended consequences of building a business is that you become essentially unemployable within your own organization. After living the life of freedom, flexibility and responsibility of being a business owner, it’s difficult to go back to a “nine-to-five” job. This is why many entrepreneurs don’t enjoy staying with their businesses after they’ve sold to other organizations. Within months, they are frustrated that they’re no longer in control and the new owners are (in their opinion) making poor choices.

I see many situations where entrepreneurs are bad employees in their own organization. In fact, they may be the worst team members in the organization by having inconsistent schedules or poor communication skills and/or by inserting themselves into areas that aren’t useful. They can also have too much freedom and flexibility. And while most entrepreneurs insist on clearly defined roles, expectations and goals for all of their employees, they don’t always take the time to define their own roles, expectations and goals.

So why do entrepreneurs become bad employees?

I believe that it’s because they don’t have someone holding them accountable. Think about it: Who do they report to? They’re the owners. Part of the definition of “owner” is being accountable for everything but not accountable to anyone. Having a board of directors, a peer group or a business coach can provide some accountability for them, but another solution is to clarify their roles in the company and then abide by those definitions.

If you find yourself “unemployable” in your business, it’s time to define your role. It starts with outlining your main focus. Do you concentrate more on day-to-day execution or strategic, long-term decisions? Do you consider yourself an owner-operator or an investor?

Most entrepreneurs start as an owner-operator and put in countless hours of sweat equity doing whatever needs to be done to build the business. But over time they reinvest earnings in the business and hire a management team so they can step back and take on a more strategic role. Sometimes it’s not clear when the entrepreneur makes that transition, which can lead to challenges for the entire team.

Focus: Strategic Overview

If your main role is in dealing with long-term, strategic decisions, then it’s important for you to communicate that to the team. Clearly delegate tactical roles and responsibilities to the leadership team.

I’ve seen many instances where owners do more harm than good by haphazardly injecting themselves into tactical decisions that should be handled by the leadership team. Instead of jumping in when they see something they disagree with, I encourage owners to actively “coach” their leadership team to be better leaders. The approach of micromanaging every decision of others will frustrate everyone and lead to an underperforming organization.

I have one client that decided his role was to build strategic relationships and work on a new service offering. He was confident that his leadership team could handle the day-to-day operations of the business. Over time he discovered that being in the office every day was actually a distraction for him and his team. So, he moved his office out of the building.

To maintain his ownership responsibilities to the company, he scheduled one afternoon a week to physically be in the office. Team members knew they could schedule time with him during that weekly window when he temporarily set up office space in a conference room. Not having a permanent office in the building also sent a message to the team that he was not responsible for day-to-day decisions. Sometimes not having an office in the building is better than the team seeing the owner’s office empty on a regular basis.

Focus: Day-to-Day Execution

If you decide that your role is in the day-to-day execution of the business, then clearly define your role in the same way you would define any other team member role. Are you in charge of marketing? Sales? Finance? Operations? Technology? R&D? Or, some combination of multiple roles? Take the time to outline your responsibilities and communicate them to the team.

Just as you define your role, also define what you are NOT going to do and who is responsible for those areas. After all, sectioning off some tactical work does not abdicate you from long-term decision-making. You must set aside time to make the long-term, strategic decisions of the company.

Being an entrepreneur sounds glamorous to those that haven’t done it, but ultimately, the owner is accountable for everything that happens in their organization. It can be quite sobering. And while some entrepreneurs have a delusional belief that they can do everything in a company, it’s not a path to long-term success.

All entrepreneurs have to decide what their role should be in their organization – even if it means that they’re contributing to their “unemployable” status.

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Business Entrepreneur

7 books every entrepreneur should read

(BUSINESS ENTREPRENEUR) You’ve heard it said, “do as I say and not as I do.” Read these books from authors who have figured out what works and what doesn’t when starting a business.

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If you’re thinking about leading a startup (or already do), but are not sure where to go, the internet is often the first place we look. Surely, you can find dozens of blogs, articles, stories, and opinionated editorials that can help give you something to think about.

However, there are tons and tons of great books that can help you think about what you need to get started, how you could benefit from changing your mindset, or address challenges you may confront as you begin your entrepreneurial journey. Take a look at the following 7 you may want to add to your bookshelf.

1. The Startup Checklist: 25 Steps to a Scalable, High-Growth Business
This text not only boasts a 5 start rating on Amazon, but offers what few books do – practical, tangible, down to earth advice. Where lots of books try to tell you a story, talk strategy, and share wins, author David Rose instead focuses on advice that assumes no prior experience – and breaks it down from the fundamentals.

2. Nail It then Scale It: The Entrepreneur’s Guide to Creating and Managing Breakthrough Innovation
Nathan Furr and Paul Ahlstrom focus on creating a lean startup by offering a step-by-step process that focuses on nailing the product, saving time, and saving money. The first step is about testing assumptions about your business, and then adjusting to growing it (hence: Nail It and Scale It). Strong aspects of this book include a great theoretical foundation, and an easy to follow framework.

3. The Founder’s Dilemmas: Anticipating and Avoiding the Pitfalls that Can Sink a Startup
Wasserman’s strength here is that he focuses not only on the financial challenges, but identifies the human cost of bad relationships – ultimately how bad decisions at the inception of a start-up set the stage for its downfall. This book is a great tool to proactively avoid future legal challenges down the row, and also discusses the importance of getting it right from the start.

4. The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers
Horowitz writes about his experiences, taken from his blog, in a way that even inexperienced managers can touch and learn. The advice here really focuses on leading a start-up, and what lessons his experience has given him. Presented in a humorous, honest, and poignantly profane way.

5. The Startup Owner’s Manual: The Step-by-Step Guide for Building a Great Company
Blank and Dorf here standout due the sheer mass of this text. A comprehensive volume at 573 pages, my favorite piece for new investors is a focus on valued metrics – leveraging data to fuel growth.

6. The Subtle Art of Not Giving a F*ck: A Counterintuitive Approach to Living a Good Life
A personal favorite of mine, this book is recommended for entrepreneurs not because it’s focus on business, but as a reminder that those of you wanting to start up are people. You have limited resources to manage as a person, and will need to adjust your perspective on what you care about. This book is about changing your mindset to pick your battles and be more focused.

7. Disciplined Entrepreneurship: 24 Steps to a Successful Startup
Bill Aulet starts with an approach that entrepreneurs can be taught, and breaks down the process into 24 steps, highlighting the role of focus, the challenges you may encounter, and the use of innovation. This text wins due to its practicality for new start-ups, and a specific method for creating new ventures. It also features a workbook as an additional, optional resource.

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