Legal Considerations for Independent Contracting
It is important to consider and be aware of the legal aspects of earning a living as an
independent contractor without legal status. Under federal law, as mandated by the
Immigration Reform and Control Act of 1986 (IRCA)
1
, it is illegal to knowingly employ
unauthorized workers in the United States. This applies to all workers; however, an
employer’s responsibility to verify work authorization is much higher for workers
classified as employees than for workers classified as independent contractors, sporadic
domestic workers, or workers who are hired through contracts with other legal entities.
The IRCA requires employers to verify that every new employee is legally authorized to
work in the U.S., through a two-part federal employment verification system, known as
the “I-9 System”. First, an employee must complete Form I-9, Employment Eligibility
Verification and assert under penalty of perjury that they are legally authorized to work
in the U.S. Second, the employer must review the original documentation from a
specified list (e.g., birth certificates, passports and work permits) to verify both the
worker’s identity and eligibility to work. After review, the employer must certify under
penalty of perjury that they have examined the original documentation.
2
There are exceptions to the I-9 System obligations when not dealing with employees. An
individual or entity is NOT required to obtain Form I-9 from independent contractors or
sporadic domestic workers.
3
Further, Individuals or entities are generally not obligated
to affirmatively verify the work authorization of individuals whom they engage as
independent contractors. However, Federal Statute 8 U.S. Code 1324a(a)(4) prohibits an
individual or entity from knowingly engaging an unauthorized individual to provide
services as a contractor.
4
This means that if an employer is aware that an employee’s
work authorization has expired, he or she could not then contract with that same
individual as an independent contractor. Therefore, if a DACA beneficiary were to lose
his or her work permit, the company that hired them would not be able to contract with
1
Immigration Reform and Control Act of 1986, Pub. L. No. 99-6603, 100 Stat. 3359 (codified at 8 U.S.C §
1324a). The IRCA amended the Immigration and Nationality Act (“INA”).
https://www.gpo.gov/fdsys/pkg/STATUTE-100/pdf/STATUTE-100-Pg3445.pdf
2
8 CFR § 274a.2(b)(1)(i)(B), https://www.uscis.gov/ilink/docView/SLB/HTML/SLB/0-0-0-1/0-0-0-11261/0-
0-0-28757/0-0-0-28810.html
3
8 CFR § 274a.1, https://www.uscis.gov/ilink/docView/SLB/HTML/SLB/0-0-0-1/0-0-0-11261/0-0-0-
28757.html
4
United States Code, 2006 Edition, Supplement 5, Title 8 - ALIENS AND NATIONALITY
https://www.gpo.gov/fdsys/granule/USCODE-2011-title8/USCODE-2011-title8-chap12-subchapII-partVIII-sec1324a/content-
detail.html