Where Do You Store the I-9 for a Contractor?

All US employers are required to complete and retain an I-9 form to document that each new hire is authorized to work in the United States. During a compliance web conference I conduced a participant asked me, “Where should we store the I-9 forms for our contractors?”  I was surprised by the question and replied with a quick, simple answer, “You don’t need I-9 forms for contractors so you shouldn’t store them anywhere.” 

A subsequent inquiry included, “Isn’t the lack of an I-9 one of the red flags that can trigger a wage and hour claim about employment status?” I was beginning to get confused myself, were we discussing eligibility for work or wage and hour compliance? Whether an individual is an employee or a contractor should be treated as an entirely distinct issue from their immigration status.

The last question on the topic was, “Isn’t it OK if we just hire anyone who doesn’t have a visa or work permit for the US to work as a contractor?”  On his last trip to China your Director of Operations stopped by a major university and recruited 12 recent grads to come to Denver to work on a key project. He said, “No need to worry about a visa, we’ll pay for the airfare, find a few apartments nearby, put them to work and call them consultants.”  Sounds like an employee relationship to me and the IRS who asks, “ Does the company control or have the right to control what the worker does and how the worker does his or her job?” and, “Are the business aspects of the worker’s job controlled by the payer?”

To conclude this mini-tutorial on contractor status and work authorization: classify individuals properly, and complete I-9 forms for all employees.