New York City Compliance Reminder: I-9 Compliance for NYC Restaurants

Panko Compliance · May 22, 2026

## What it is Form I-9 is the federal employment eligibility verification document required for every employee hired in the U.S. since 1986. Section 1 is filled out by the employee on or before their first day of work. Section 2 is filled out by the employer within 3 business days of the start date, after physically examining acceptable identity and work-authorization documents. E-Verify is a separate, voluntary online system that cross-checks the I-9 data against DHS and SSA records. It's required for federal contractors and some state contracts, but optional for most NY restaurants. ## What compliance looks like 1. Section 1 on or before day 1. Employee fills out personal info + attests to citizenship/work authorization status. 2. Section 2 within 3 business days. You physically examine documents from the I-9 acceptable list. As of 2023, remote E-Verify users can complete this virtually; others must do it in person. 3. Acceptable documents. Either ONE List A document (passport, permanent resident card, employment authorization document) OR ONE List B + ONE List C (driver's license + SS card; state ID + birth certificate; etc.). The employee chooses what to present — you cannot demand a specific document. 4. Retention. Keep the completed I-9 for either 3 years after the hire date OR 1 year after termination, whichever is LATER. Store separately from personnel files (so an audit doesn't expose unrelated info). 5. Reverification. If the employee presented a document with an expiration (employment authorization, not a green card), you must reverify before the expiration date. Reverification goes in Section 3 of the original I-9 or a new I-9 with Section 3 only. 6. Self-audit. IRS, DHS, and DOL all recommend periodic internal audits of your I-9 binder. Catch errors and document corrections in the margin — never erase original entries. ## Penalties for non-compliance Substantive violations (missing I-9, missing Section 2, wrong document): $281–$2,789 per form (2026 inflation-adjusted). Knowingly hiring unauthorized worker: $698–$5,579 first offense; up to $27,894 for repeat patterns. Failure to comply with E-Verify (where required): $1,116 per violation. Pattern of violations + identity document fraud: criminal charges, up to 5 years imprisonment per count. ICE inspects high-risk industries — restaurants are on the list. The audit process: ICE serves a Notice of Inspection, you have 3 business days to produce all I-9s, they review and either approve or issue a Notice of Suspect Documents + Notice of Technical or Procedural Failures (with 10 days to cure) or proceed to fines/criminal referral. --- Full guide with sources: https://alerts.getpanko.app/compliance/nyc/i-9-and-e-verify

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