SSN "No-Match" Letters
NCLR/NILC Comment Letter
October 3, 2002
The Honorable E. Clay Shaw, Jr.
Chairman, House Social Security Subcommittee
B-316 Rayburn House Office Building
Washington, DC 20515-6353
The Honorable George Gekas
Chairman, House Immigration, Border Security and Claims Subcommittee
B-370B Rayburn House Office Building
Washington, DC 20515-6353
RE: Preserving the Integrity of Social Security Numbers and Preventing Their Misuse by Terrorists, Hearing held before the U.S. House of Representatives Subcommittee on Social Security and Subcommittee on Immigration, Border Security, and Claims, September 19, 2002
Dear Chairmen and Members of the U.S. House of Representatives Subcommittee on Social Security and Subcommittee on Immigration, Border Security, and Claims:
The National Council of La Raza and the National Immigration Law Center appreciate the opportunity to submit comments on the issue of the Social Security Administration's no-match letters.
Sent by the Social Security Administration (SSA) to certain employers, no-match letters have had a devastating impact on immigrant worker communities throughout the country. For the last several years, advocates have been expressing deep concern about the continued use of these no-match letters by employers to discourage immigrant workers from asserting their workplace rights. Advocates have also been working hard to educate employers who, due to the confusion caused by these letters, feel pressured to take some action against employees listed in the no-match letters. The recent hearing before the Subcommittee on Social Security and the Subcommittee on Immigration, Border Security, and Claims of the U.S. House of Representatives highlighted many of our concerns regarding the no-match letters. The hearing also clearly demonstrated the need for a balanced and thoughtful approach to immigration policy that recognizes the contributions that immigrant workers make to the U.S. economy as well as our nation's economic and security needs.
In an effort to update its database, the SSA sends no-match letters to employers when the names or Social Security Numbers listed on an employer's W-2 forms do not agree with SSA records. Attached to each no-match letter is a list of employees for whom the SSA database could not find a match. The no-match letter is intended to be an educational correspondence that informs companies that their employees' wages are not being properly credited to their Social Security accounts. The SSA aims to correct its records so that employees' earnings are accurately tracked and can be used to calculate benefit levels when applications for retirement or disability benefits are made with SSA. Correcting the SSA database is certainly a commendable goal. However, the effectiveness of these no-match letters is unproven, and the resulting consequences on immigrant worker communities have been devastating.
The SSA's use of the no-match letters has increased dramatically over the past year. While fewer than 100,000 letters were sent in 2000, 110,00 were issued in 2001 and 870,000 were reportedly sent to employers in 2002. However, despite this increase in letters, the Earnings Suspense Fund (ESF) has not decreased. Rather than identify a more effective means to decrease the suspense file, the SSA has increased substantially the use of the ineffective no-match letters. During Mr. Lockhart's testimony, the Social Security Administration itself admitted that it must review the effectiveness of this policy.
However, the system's ineffectiveness is not its gravest consequence. The impact of the no-match letters on the immigrant community has been profound and widespread. The failure of the no-match letters to safeguard workers effectively against unfair and illegal practices on the part of employers has had devastating effects on the workers and their families.
As the SSA admits, there are many reasons for computer no-matches, and the no-match letters themselves do not prove any wrongdoing by either employer or employee. For example, a large proportion of the names on the no-match letters are Latino, Asian, or other names frequently misspelled by employers resulting in computer no-matches. These honest data-entry mistakes disproportionately affect immigrant workers. However, employer misuse of the no-match letters has caused great harm to workers nationwide. While the letter explicitly warns employers not to take adverse action against workers listed on the letter, layoffs, suspensions, firings, retaliations, and discrimination against these workers are widespread and well-documented. Some employers have simply fired all workers on the list; others have incorrectly reverified the work authorization of workers on the list. In many cases, only Latino or other "immigrant" workers, or workers involved in union organizing campaigns, have been fired or harassed (See Aaron Nathans, "UW and Janitors Settle; Tentative Deal: $24,000 for Latinos," Capital Times, Dec. 8, 2001 at A1). And since a disproportionate number of names on the no-match lists are "foreign-sounding" names, many employers fear that they will face sanctions if they hire additional workers who look or sound "foreign" resulting in increased citizenship or national origin discrimination in the hiring process.
Low-wage immigrant workers are the most likely to be affected by all of these illegal practices. In fact, our communities have reported widespread abuse of the SSA no-match letters resulting in greatly increased anxiety within the immigrant community. Many legal permanent residents and even U.S. citizens have been affected, and the undocumented worker community has been pushed even further underground. Because many immigrants live in mixed-status families and close-knit communities, when one worker is fired entire families including U.S. citizen children suffer.
Thus the SSA's no-match letter policy has not resulted in reducing the suspense file, has not eliminated computer no-matches, and has not diminished unfair hiring practices. In fact, the consequences have been quite the contrary. Particularly in this time of heightened security, we must foster an environment that that will encourage individuals to emerge from the shadows and participate as productive members of our society in order to separate them from those who are here to do us harm. Rather than pour the SSA's resources and energies into an ineffective and harmful policy, we must be prepared to step back and look at the larger picture.
The testimony of Mr. Matthew James Reindl highlighted the advantage that unscrupulous employers who hire undocumented workers have over law-abiding employers. For years, immigrant advocates have argued that unlawful hiring practices harm both immigrant workers and U.S. workers. The recent Supreme Court decision in the Hoffman Plastic Compounds Inc. vs. NLRB, ___ U.S. __, 122 S. Ct. 1275 (2002), further exacerbates that advantage and gives added incentive to employers to hire unauthorized workers. In that decision the Court found that undocumented workers who are illegally fired are not eligible for certain backpay remedies under the NLRA. This decision means that employers can continue to hire unauthorized workers and subject them to exploitative conditions and even fire them for union organizing activities—all of which are illegal regardless of a worker's immigration status—with no out-of-pocket costs. The Social Security Administration's no-match policy will not punish these employers nor resolve the underlying problems associated with the hiring of undocumented labor. Instead, it provides added incentives for employers to take unlawful action against the workers whom they have knowingly hired with no legal ramifications. The answer to the problem raised by Mr. Reindl is to enact legislation reversing Hoffman, thus leveling the playing field by removing the incentive to hire undocumented workers to whom they will never owe backpay.
The problems highlighted during the hearing clearly demonstrate the need for comprehensive immigration reform. The existence of the SSA suspense file shows that immigrant workers, regardless of their immigration status, are paying Social Security taxes and are not receiving the benefits of those taxes. The evidence presented also demonstrates that immigrant workers are essential to the U.S. economy and that U.S. employers have knowingly and unknowingly hired many undocumented workers needed to fill jobs in key sectors of the economy. These hardworking, taxpaying immigrants should be rewarded for their contributions by getting the opportunity to legalize their immigration status and obtain permanent residence in the U.S. Only in this way can these workers come out from the shadows, be known to U.S. authorities, properly pay all of their taxes, and be compensated appropriately. Such a legalization program would also greatly reduce document fraud by virtually eliminating the market for falsified Social Security Numbers and other identifying documents, and the Social Security Administration could continue its primary mission of administering the Social Security program.
We urge you to reflect upon the ineffectiveness of the no-match letter policy and work towards effective and comprehensive solutions to the problems associated with unauthorized labor in the U.S. We look forward to working with you in the future.
National Council of La Raza
National Immigration Law Center