This is a corrected version of the article sent out Saturday. The links in the previous article did not work properly. I apologize for that error and the version below does contain working links.
We have been working hard to obtain the best information for our members in responding to the “no-match” letters. The following is an updated version of the guidance we sent out three or four days ago. Updated links to the letters are attached below. If you are working through responding to a no-match letter, please review the updated material below. This new version contains a letter you can send to the SSA if you are too close to your deadline, that simply says you are working on the issue and will respond with a final response later.
We continue working with members and will keep you all informed as we learn additional information about this issue.
We have spent a lot of time and effort since our members began to receive so-called “no-match letters” from the SSA, and we consulted with experts in the employment law field trying to determine the best possible advice to give related to the Social Security Administration (SSA) no-match letters. Most recently we have been discussing these issues with attorneys from Fisher Phillips, who have put together some further guidance on this issue. Click here for a of that Firm’s May 7 guidance to employers on this subject. I won’t try to summarize all of that information here. Here is another version of the link from the firm’s website: https://www.fisherphillips.com/resources-alerts-an-employers-7-step-guide-to-navigating.
That firm has concluded that on balance, there is serious risk in failing to address the SSA that you fully address the apparent request that your company obtain log-in credentials to be able to use the Business Services Online (BSO) if your company is not already registered so you have access to that system. Once your company has fully registered to obtain access to that database, you can learn the names of the persons identified by SSA as having W-2 filings with names that do not match the SSA records. Once you know whose names don’t match, then you can complete the full “checking” and reporting processes by filing and issuing amended W-2C forms to correct the names and/or numbers of your current and former employees. Doing all of this may take longer than 60 days after you first received the SSA request that you undertake these processes. Note that even after you first log into the BSO to begin the registration process to have access to the names of the persons whose records don’t match, it may take 10 days or more to receive full BSO access credentials so you can log into that BSO site and learn the names, if you do not already have access to the BSO site. Attached here is a sample letter you may want to send to SSA to say that your company is undertaking this process.
On the one hand, complying with the SSA request for you set up BSO access to find out who the employees and former employees are whose records resulted in the “no-match and then following through all of the steps that may be required to obtain corrected information or to at least be able to show that your company tried to do so is a real burden.
The other concern, however, is that if your company fails to learn the names of the individuals whose records do not match and then to try to obtain corrected information and file and issue corrected W-2C forms, in the future, Immigration and Customs Enforcement (ICE) may urge that your failure to take such actions is proof that your company or some individual managers whose knowledge would be attributed to the company, knew or should have known that the company employs or employed persons who are or were not legally authorized to work in the United States or who were engaging in identity fraud. There may be other adverse consequences as well even though the SSA form letter asking employers to take these actions expressly warns employers not to assume that the mere fact of a no-match status calls the person’s immigration status or work authorization status into question.
What to do if you are going to attempt to resolve the no-match “problem” identified by SSA in the letter your company received besides confirming to SSA that your company is working on the resolution.
Even before you are able to log into the BSO system, if your company had or has a small workforce, you may be able to figure out who has the no-match problem by checking your own records. When you start this process, play careful attention to the tax year stated on the letter. Some of the employers have determined that the mis-matched records were from two ginning seasons ago. You are looking at the exact names and social security numbers provided by the employee and comparing that to the information you delivered when you sent payment into the SSA.
In some cases, the employer may have a good idea of who the affected employees are. I have heard examples of employees who have gotten married and had a recent name change, or other employees who have their middle initial listed on their driver’s license and their middle name listed on their Social Security Card. In this instance the payroll was written using the information from the driver’s license, so the Social Security Card name did not exactly match the payroll data used to create the W-2 filing. If you feel comfortable that you have identified the employees without using the BSO portal, you may elect not to use the portal.
We have had many gins call to say that it sure would be easier if they could use the portal, so that they could get a list of the names that the SSA is referring to. After carefully studying the issue, the recommendation we are receiving, as outlined above and in the Fisher Phillips guidance is that is prudent to log into the online portal to find the names in question, if you are not able to determine the names of the mismatches without the BSO system. As long as you complete the remainder of this process as outlined below, it is unlikely that accessing the portal will be a problem for your company. When you log into the system, you will want to sign up for the “Report Wages to Social Security” and “View Names and Social Security Number Errors”.
The key part of this process comes next. For each current employee identified by as having a no-match problem, you should give them notification in writing that a mismatch between the person’s name and/or social security number between the company records used to make the W-2 filing and the SSA records has been identified by the SSA. Click Here to see a sample letter. Before communicating with the employees, as noted above, however you should try to identify the source of the mismatch. If it is an obvious issue such as a number transposed for the SSN, then you should file the W-2C to make this correction. This may be done online through the SSA portal, or you can mail in a corrected form. If you elect to mail this form in, be sure to follow the instructions carefully – you must order the form, and they will mail you a special copy. Do not pull the sample form off the web and send that form in by mail because the instructions say that using the on-line form for a paper mail filing will result in a fine. If you have several employees and former employees for whom you have no-match information and some begin to turn in corrected information that requires an amended W-2C filing, you may want to go ahead and issue the corrected W-2C forms and file them without waiting to hear from each person from whom you have requested corrected information. Do keep a record of each corrected W-2C issuance and filing you make and the date you made it.
If you are unsure of the source of the mismatch for a current employee, then the employee needs to contact the SSA and get this mismatch resolved. Under this scenario you should give the employee the notification in writing, and make sure you keep a copy of the notification and document the date you gave or mailed them this letter. You should explain to them that the money you are paying to SSA is for their benefit down the road, and it is important that they get credit for this money being paid. Review your records carefully before talking to your employee, so that you can get the obvious issues resolved without alarming the employees. The phone number for the employee to use is listed on the letter you received. The real tough part comes if the worker refuses to contact the SSA, or just puts it off for a very long period of time. If you find yourself in this situation, it will be best to communicate with us and your attorney before taking any action on this employee, but this step is much further down the road.
It is recommended that you ask the employee to let you know within a certain time period (maybe 30 days) of the result of their discussion with the SSA and then follow up if the person has not provided the correction to give the person additional time if the matter is not yet resolved. Again, it is important that you document these discussions and any results from the employee regarding the person having contacted the SSA. You might want to give them this information in writing, using the same template discussed below. For all current employees, you need to keep track of whether they completed these steps. It would probably be good to keep the same records for former employees, but it is very unlikely that they will respond to your letter unless they hope for future employment with your company.
If the employee identified in the letter is not a current employee, then you will want to send them a letter. Click Here for a sample letter that you can use for former employees. You should keep a copy of this letter, and document when it was mailed.
Once you have contacted all your current and past employees and have their individual corrected or confirmed information, then you should send a final reply to the SSA. Click Here for a suggested letter to use. You want to be sure you have sent off the letters to the former employees and have talked to your current employees before sending your final reply letter to the SSA. This letter is not saying that you have fixed all of the issues that need to be fixed, but it is saying that you have notified all of your employees and former employees of the issue and are working to get all these issues resolved even if you do not have corrected or confirmed information from every single person.
Going forward, there are two scenarios that I would think are most likely potential issues arising from these letters. The first is for a current employee that does not get their issue straightened out. On one hand, the letter from the SSA says that it should not be used for hiring or employment decisions. On the other hand, doing nothing about an employee mismatch with no explanation could later be taken as evidence of knowingly employing a person who is not lawfully permitted to work in the US, with substantial penalties. Therefore, it is important to document how you handled each of these mismatch employees, to document how you resolved each issue, and to make sure you keep all of that documentation if your actions are later called into question by ICE or any other person or agency. Be sure to contact your attorney before taking any action against any employee – the decision of what to do if there is no resolution should be made very carefully.
A similar issue could happen with a returning employee. If you were notified of an employee mismatch on a former employee that returns the following season, you could have essentially the same problem described above. You particularly will want to work with former employees who want to return to work for your company and whom your company would like to re-hire. You will not want to be in the position of having to require them to resolve their name/social security number discrepancy during a very busy season or to discontinue their employment if they fail to show you proof that they have resolved the issue. This is a second topic that you may want to visit with your attorney about, especially if you commonly have the same workers return each year.
I hope this information is sufficient for all of you to get your employees notified and to get at least a preliminary response notification letter back to the SSA within the designated 60-day time period. If you do have significant issues come up during this process and need assistance in getting advice on these specific issues, please give your TCGA office a call. We will be glad to help you in any way possible with this issue.