The federal government has decided to postpone until June 30, 2009, implementation of the E-Verify requirement for federal contractors.

In June 2008, President George W. Bush issued an executive order requiring federal government contractors to use E-Verify to confirm work eligibility of all new hires and existing employees assigned to work on federal contracts. The final rule, published in November 2008, applies to prime federal contracts with a period of performance longer than 120 days and valued above $100,000 and to subcontracts for services or construction valued at $3,000 or more.

The final rule initially was to go into effect January 15, 2009. However, the federal government delayed implementation to February 20, 2009, after a coalition of business groups filed a lawsuit challenging the rule. On January 28, 2009, the government announced a second postponement, to May 21, 2009, to allow the Obama Administration time to review the modified rule.

Although employers presently are not required to use E-Verify based on federal government contracts, those with locations in certain states or having state or local government contracts may be subject to state law requirements mandating use of E-Verify. Thus, employers should review any state or local contracts and laws of the states in which they are located for possible E-Verify requirements.