Have you received a Social Security “mismatch” letter?
Published in Dairy Star July 14, 2007
Ask for an original social security card from all new employees so withholding taxes and social security deposits are accurately credited to the proper account.
At one time when a farmer employed someone, about all they had to do was decide whom to hire, how much to pay and issue a paycheck. Those days are long past.
Employers today need to check the employee's eligibility to work in the country, file W-4 forms for tax withholding, report the hiring to human services agencies, be sure there is workers' compensation in place, be sure unemployment insurance is taken care, and more.
Even after all that is done, it is still possible that you, as the employer, will receive a letter sometime from the Social Security Administration (SSA) stating the social security number you reported for an employee doesn't match up with social security records. The first thought is probably, “Now what do I do?”
The first piece of advice is, “Don't panic.” There are a number of valid reasons for mismatched names and numbers including a change of name (marriage or divorce), typographical or reading errors, or missing digits in the number reported. Mismatch letters are sent any time the reported name and number don't match up with the name on record in the SSA, or if the number doesn't show up in the files at all. It is reported that in 2002, about 12% of employers submit information to the SSA that could not be matched to an account, representing approximately 5,000,000 items. If you got the letter, you weren't alone.
Accuracy is important to be sure taxes withheld and social security deposits submitted are credited to the proper account for future benefit use. It is important that you ask for an original social security card from all new employees at the time you prepare their documentation.
If you receive a 'mismatch letter, the first thing you should do is check the name and number you reported against what the employee provided to you. Some employers keep a photocopy of social security cards and other provided documents on file when they hire new employees. Some employment advisors suggest this is not a good practice, but if you do keep such a record, check it against what was filed on the W-4. If you don't keep copies, ask the employee to check their social security card against the information you have on file. If they do not agree, the employer should file a W-2c with the corrected information.
If your records and the employee's social security card number are the same, the employee should be directed to the SSA to resolve the issue and you should ask the employee to report back to you with any necessary corrections.
If the employee does not report resolution of the problem with the SSA, or the employee no longer works for you, your task becomes a bit more difficult. You should still try to contact the employee and get the information corrected. If you are unable to contact them, document your efforts to do so in writing. Keep copies of your correspondence on file. Failure to report proper social security information can subject the employer to fines of $50 per violation under IRS code. Your good effort and record of that effort go a long way toward preventing such fines being levied.
It is at this point you might encounter one of several different situations requiring your attention.
The employee might tell you the information is incorrect and he or she is not authorized to work in the U.S. This is reason for you terminate the employee immediately as an undocumented worker.
The employee might tell you the SSA cannot resolve the problem. If this happens, you need to make a difficult decision. You can continue to keep them on the payroll and risk penalties for improper reporting, or you can terminate them and face the prospect of a discrimination claim. If you find yourself in this situation, it would be wise to seek legal advice.
One way to minimize the potential of a discrimination claim is to be sure you ask every employee on the farm for all the same information at the time of hiring.
Employers should also know that receiving a “mismatch” letter for an employee (especially a foreign worker) does not automatically mean that worker is an undocumented or illegal worker. Terminating an employee on that basis alone could easily trigger a discrimination claim. Be sure to ask those employees for the same corrective information as any other employee. Also, it is not your responsibility to report to any agency if it is confirmed an employee is undocumented. While you are responsible for accurate reporting of social security information, immigration enforcement is not your responsibility.