From Administrative Task to Enterprise Risk: The Shift in Federal I-9 Enforcement

For years, many HR teams viewed Form I-9 compliance as little more than a routine, administrative onboarding task. That assumption is no longer viable.

Part 1 of our 4-part research series covers how federal immigration enforcement has undergone a dramatic transformation over the last 18 months, shifting workforce authorization from a background administrative task into a critical C-suite risk management priority.

With ICE Notice of Inspection (NOI) volumes surging roughly tenfold compared to 2024, expanded cross-agency data sharing, and a zero-tolerance stance on paperwork errors, employers face an operational and legal landscape where non-compliance carries severe consequences. Below, we break down how recent regulatory shifts, expanded audit quotas, and stricter penalty enforcement are reshaping risk for employers nationwide.

Download the full report below: I-9 Enforcement and Workforce Compliance: The New Reality for Employers. 

Executive Summary 

Early last year, OutSolve published an assessment of expected changes to employment and hiring compliance requirements under the new Trump Administration. It examined how proposed immigration enforcement initiatives could affect employers across the United States. At the time, many HR and compliance leaders viewed those policy proposals as future possibilities. A year later, those possibilities have become operational realities. 

The first 18 months of the Trump administration's immigration enforcement agenda have produced a decidedly more stringent workplace compliance environment for US employers. Federal agencies have dramatically increased worksite enforcement activity, expanded interagency data-sharing initiatives, increased penalties due to reclassification of errors, revised inspection procedures, and implemented policy changes affecting millions of employees and employers nationwide. 

For employers, the consequences extend well beyond compliance with immigration law. Workforce authorization compliance now directly affects labor availability, recruiting timelines, operational continuity, financial performance, and corporate reputation. Organizations that once viewed Form I-9 compliance as a routine onboarding activity must now treat it as a critical business function requiring executive oversight and continuous management and improvement. 

Several developments have transformed the compliance landscape: 

• According to the Washington Post, DHS/ICE Notices of Inspection (NOIs) have increased dramatically since early 2025, with immigration attorneys and employer compliance experts reporting roughly a tenfold increase in employer I-9 audits compared with 2024, marking the highest level of worksite enforcement activity in more than a decade. 
• Industries dependent on immigrant labor are experiencing disruption due to ending TPS for many countries. Seasonal industries such as agriculture experienced raids. 
• New E-Verify mandates emerged at the state level, increasing compliance complexity for multi-state employers. 
• Work authorization programs, like Temporary Protected Status (TPS), affecting hundreds of thousands of employees (including those in the country under the foreign student visa program) underwent significant changes, creating uncertainty for employers attempting to maintain workforce stability. 
• ICE expanded its enforcement capabilities through significantly increased staffing and funding. 
• ICE has also entered new information-sharing arrangements with other federal agencies including IRS and Centers for Medicare and Medicaid. 
• The operational burden on HR departments has expanded as employers assumed ongoing monitoring responsibilities for employment authorization changes. 

This paper examines the most significant developments – regulatory as well as operationally – over the past year-and-a-half under the Trump administration and assesses their implications for employers.  

The central conclusion is clear: I-9 compliance and associated employment verification requirements have evolved from an administrative obligation into an enterprise talent-planning and risk-management issue that requires executive-level attention. 

A Full Year of the Trump Administration’s I-9 Enforcement 

The first year of the administration's immigration enforcement agenda confirmed many of the concerns anticipated by employers, attorneys, and compliance professionals. While enforcement priorities were widely discussed during the campaign and early months of the administration, the scale and speed of implementation exceeded many expectations. 

For HR leaders, the result has been a year characterized by heightened scrutiny of Form I-9s and foreigners seeking to work in the United States, strict interpretation of documentation requirements, more frequent audits, and uncertainty surrounding employment authorization programs. 

What Employers Expected is Just What Happened: 

• Increased worksite audits and I-9 NOIs  
• Expanded enforcement targeting labor-intensive industries 
• Greater reliance on E-Verify and electronic compliance systems 
• Higher civil monetary penalties for errors or hiring unauthorized workers 
• Increased information sharing and coordination among federal immigration enforcement agencies 

Following is an examination of each expectation. 

Notice of Inspection Volume Increased 

The most visible indicator of the administration's enforcement strategy has been the increase in ICE Notices of Inspection (NOI). 

Historically, ICE worksite audits have fluctuated significantly based on administration priorities. During the previous several years, employers generally viewed the probability of receiving an audit as relatively low. That assumption is no longer valid. 

Immigration law firms tracking enforcement activity during 2025 estimate that ICE issued NOIs at a rate estimated to be as much as ten times greater than the prior year.  

Equally significant were reports that ICE offices were assigned formal inspection quotas. Whether viewed as performance targets or operational objectives, such quotas signal an institutional commitment to sustained worksite enforcement. were assigned formal inspection quotas. Whether viewed as performance targets or operational objectives, such quotas signal an institutional commitment to sustained worksite enforcement. 

For employers, this means the probability of receiving an audit notice is far more likely—particularly for organizations operating in industries identified as enforcement priorities. 

Expanded Industry Targeting  

Agriculture, construction, hospitality, manufacturing & food processing, and staffing organizations experienced elevated ICE enforcement activity throughout 2025, as worksite investigations, raids, and I-9 inspections increasingly focused on labor-intensive industries that traditionally employ large immigrant workforces. 

These sectors share several characteristics that attract immigration and employment regulatory attention: 

• High employee turnover 
• Seasonal workforce fluctuations 
• Reliance on contingent labor 
• Significant use of subcontractors or labor brokers 
• Historically elevated rates of documentation deficiencies 
  

Electronic Compliance Systems Become Essential (E-Verify)

The growing complexity of compliance obligations will likely motivate many employers to adopt electronic I-9 systems and use E-Verify.  In fact, the federal government is proposing that recipients and subrecipients of federal financial assistance be required to use E-Verify as a condition of receiving federal funds. 

Manual processes are increasingly insufficient to manage reverification deadlines, documentation retention requirements, audit trails, and changing employment authorization statuses, especially if you have a decentralized HR team and span multiple states or locations.

At the federal level, the administration has proposed that all recipients and sub-recipients of federal financial assistance be required to enroll in E-Verify.

State-level developments further accelerated adoption. Ohio's E-Verify Workforce Integrity Act established mandatory verification requirements for certain construction employers, while Iowa expanded E-Verify requirements for state agencies.

As more states consider imposing E-Verify obligations on employers, organizations relying on paper-based processes may find themselves at a significant disadvantage.

Increased Penalties and Reduced Error Tolerance

Financial penalties continued their upward trajectory throughout 2025 and 2026. Certain paperwork violations now carry steeper penalties due to reclassification to substantiative violations and can range from hundreds to several thousand dollars per form. Repeat violations involving unauthorized workers can produce penalties exceeding $28,000 per employee. More consequential, however, is the apparent shift in how common documentation errors are classified during inspections.

Historically, many technical deficiencies could be corrected during a designated remediation period. Some errors previously considered technical are now substantive violations. 

For employers, this distinction is critical. Substantive violations generally provide fewer opportunities for correction and may result in immediate financial liability. The practical implication is straightforward: accuracy at the time of completion has become significantly more important. (More detail on the reclassification of errors is provided later in this paper.)

One stark example of the financial cost of hiring unauthorized works: in April 2025, ICE proposed more than $8 million in civil penalties against three Colorado janitorial and property-management companies after worksite audits found that they had employed at least 143 unauthorized workers. Of the three, CCS Denver, Inc. was fined $6 million for having 87 unauthorized employees.

Multi-Agency Data Sharing Expands Enforcement Reach

One of several significant long-term developments involves expanded information sharing among federal agencies. The April 2025 Memorandum of Understanding between ICE and the IRS represented a substantial shift in the federal government's ability to analyze employer information across agencies. Although portions of the arrangement became subject to litigation, the initiative demonstrated the administration's commitment to using existing federal data resources to identify potential enforcement targets.  The Administration also wants to use Medicaid databases to prohibit states from providing benefits to unauthorized aliens. 

At the state level, more states with E-Verify obligations are using periodic employer reports to confirm compliance.  For example, employers in Florida with more than 25 employees are required to use E-Verify.  Every quarter, the employer submits reports to the FL Department of Revenue.  Any employer with more than 25 employees that is not certifying its use of E-Verify can be flagged for investigation. 

Additional efforts to access employment-related databases suggest that data analytics may become an increasingly important component of future investigations. For employers, this means compliance deficiencies identified by one agency may increasingly attract scrutiny from others.

Key Takeaways 

The first year of the Trump administration's enforcement strategy demonstrates that immigration compliance is no longer a low-probability regulatory concern. Expanded audit activity, increased penalties, enhanced interagency cooperation, and evolving documentation requirements have fundamentally altered the employer’s risk landscape.

For executive leadership teams, the question is no longer whether enforcement activity will increase—it already has. The more important question is whether the organization possesses the governance structure, technology infrastructure, and operational discipline necessary to withstand scrutiny.

Relying on outdated compliance tactics leaves your organization exposed to severe financial penalties and operational disruption. In Part 2, we will examine the specific sectors bearing the brunt of this scrutiny and explore why certain operating models face disproportionate risk.