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DEPARTMENT OF LABOR

The Department of Labor (DOL) administers and enforces more than 180 federal laws. These mandates and the regulations that implement them cover many workplace activities for about 10 million employers and 125 million workers.

PUBLIC LAW 108-390 - ELECTRONIC SIGNATURE ON FORMS I-9 - (online here)

U.S. Immigration and Customs Enforcement (ICE) and the Department of Homeland Security (DHS) have received inquiries from many employers regarding the availability of electronic Employment Eligibility Verification Forms (Form I-9). Employers have expressed their frustration with being required to keep paper forms or to store the forms on microfilm or microfiche when all other aspects of their business have been automated.

On April 28, 2005, a new law will take effect allowing employers to sign and store Forms I-9 electronically.

On October 30, 2004, the President signed legislation into law (Public Law 108-390) authorizing employers to retain Forms I-9 in electronic format, in addition to the current choices of paper, microfilm or microfiche. The legislation also authorizes attestations on the Form I-9 to be manifested by an electronic signature. The legislation prescribed an effective date of April 28, 2005, or the effective date of implementing regulations, whichever occurred first.

SECTION 1. IMPROVEMENTS TO EMPLOYMENT VERIFICATION SYSTEM.
(a) IN GENERAL.--Section 274A(b) of the Immigration and Nationality Act (8 U.S.C. 1324a(b)) is amended--

(1) in paragraph (1)(A), by inserting before ``A person or entity has complied'' the following: ``Such attestation may be manifested by either a hand-written or an electronic signature.'';
(2) in paragraph (2), by adding at the end the following: ``Such attestation may be manifested by either a hand-written or an electronic signature.''; and
(3) in paragraph (3), by inserting ``a paper, microfiche, microfilm, or electronic version of'' after ``must retain''.

(b) EFFECTIVE DATE.--The amendments made by subsection (a) shall take effect on the earlier of--

(1) the date on which final regulations implementing such amendments take effect; or
(2) 180 days after the date of the enactment of this Act.

 

OCCUPATIONAL SAFETY AND HEALTH (OSH) ACT

The Occupational Safety and Health (OSH) Act is administered by the Occupational Safety and Health Administration (OSHA). Safety and health conditions in most private industries are regulated by OSHA or OSHA-approved state programs, which also cover public sector employers. Employers covered by the OSH Act must comply with the regulations and the safety and health standards promulgated by OSHA. Employers also have a general duty under the OSH Act to provide their employees with work and a workplace free from recognized, serious hazards. OSHA enforces the Act through workplace inspections and investigations.

In a letter from the Directorate of Enforcement Programs to the DaimlerChrysler Corporation on April 10, 2000 (available here),

OSHA (Occupational Safety and Health Administration) training standards generally require the employer and trainers to sign a certification record which includes the identity of the person(s) trained; signatures of the employees are not required. ... OSHA would have no objection to the use of an electronic signature pad to satisfy the certification requirements.

In a letter from the Directorate of Enforcement Programs August 14, 1997 (available here),

A search of all OSHA standards found that there is no standard that requires the employer to obtain the employee's signature. Instead, most OSHA standards concerning training require the employer and trainers to sign a certification record which includes the identity of the person(s) trained.

EMPLOYMENT AND STANDARDS ADMINISTRATION (ESA) OFFICE OF LABOR-MANAGEMENT STANDARDS (OLMS)

ESA now enables union officers in 14,000 labor unions across the country to sign and submit their annual reports electronically. Union officers use a digital signature and submit the report over the Internet.

Every labor organization subject to the Labor-Management Reporting and Disclosure Act of 1959, as amended (LMRDA), the Civil Service Reform Act (CSRA), or the Foreign Service Act (FSA) must file a financial report, Form LM-2, LM-3, or LM-4, each year with the Office of Labor-Management Standards (OLMS) of the U.S. Department of Labor's Employment Standards Administration. These laws cover labor organizations that represent employees who work in private industry, employees of the U.S. Postal Service, and most Federal government employees.

These forms (LM-2, LM-3, LM-4) can be electronic filled out and submitted to the Department of Labor using the OLMS Electronic Forms Software (available here)

These forms can be saved in a varity of formatts (PDF, XML) that can be sent through PrivaSign and allow for union officers to capture internal signatures on forms before being sent to the DOL.

 

ELECTRONIC SIGNATURES AND THE COPELAND ACT

From a letter to the Department of Transportation on November 12, 2004 (online here)

Current law establishes that the proper use of electronic signatures on certified payrolls and related compliance statements satisfies the requirements of the Copeland Act (29 CFR 3.3 and Part 5) and its implementing regulations. Those signatures carry the same legal effect as handwritten signatures.

Copeland Act

The Copeland Act prohibits inducing

by force, intimidation, threat of procuring dismissal from employment, or otherwise, any person employed in the construction or repair of public buildings or public works, financed in whole or in part by the United States, to give up any part of the compensation to which that person is entitled under a contract of employment. (18 U.S.C. 874)

Section 2 of the Copeland Act further requires "each contractor and subcontractor to furnish a weekly statement with respect to the wages paid each employee during the preceding week." (40 U.S.C. 3145 (a) ; formerly 40 USC 276(c)).

The statute's implementing regulations provide, in relevant part, that each covered contractor or subcontractor

shall furnish each week a statement with respect to the wages paid each of its employees engaged on [covered] work . . . during the preceding weekly payroll period. This statement shall be executed by the contractor or subcontractor or by an authorized officer or employee of the contractor or subcontractor who supervises the payment of wages, and shall be on form WH 348, "Statement of Compliance", or on an identical form on the back of WH 347, "Payroll (For Contractors Optional Use)" or on any form with identical wording. (29 CFR 3.3(b))

See also 29 CFR 5.5(a)(3)(ii)(A) (requiring regular submission of payroll copies to the appropriate federal agency). The regulations further specify as follows:

Each payroll submitted shall be accompanied by a "Statement of Compliance," signed by the contractor or subcontractor or his or her agent who pays or supervises the payment of the persons employed under the contract. [1] 29 CFR 5.5 (a) (3) (ii) (B) (emphasis added).

While the Copeland Act does not require that the "weekly statement" be signed, the implementing regulations do require a signed "statement of compliance." However, the regulations do not specify that the signature should be "handwritten." In addition, Wage and Hour's Form WH-347 also does not contain any language prohibiting electronic signing. See 29 CFR 5.5(a)(3)(ii)(C) (authorizing the use of Form WH-347 to satisfy the "statement of compliance" requirement). Furthermore, the Department is aware of no decision by the Administrative Review Board or any federal court addressing the issue of whether the Copeland Act requires a handwritten signature on the contractor's compliance statement. Thus, there is nothing in the Copeland Act, its implementing regulations, or the caselaw expressly prohibiting the use of electronic signatures as a valid means of compliance with the Copeland Act's reporting requirements.

Supporting Legislation

Recent legislation authorizes and directs federal agencies to accept the use of electronic signatures. Government regulatory and enforcement activities, such as those under the Davis-Bacon and Related Acts, are generally subject to the Government Paperwork Elimination Act (GPEA), Pub. L. 105-277, 112 Stat. 2681 (1998) (codified at 44 U.S.C. 3504, note), which requires, when practicable, that Federal agencies use electronic forms, electronic filing, and electronic signatures to conduct official business with the public. In section 1707, the GPEA states, in relevant part, that

[e]lectronic records submitted or maintained in accordance with procedures developed under this title . . . or electronic signatures or other forms of electronic authorization used in accordance with such procedures, shall not be denied legal effect, validity, or enforceability because such records are in electronic form. (44 U.S.C. 3504, note.)

Additionally, the Electronic Signatures in Global and National Commerce Act (E-Sign Act), Pub. L. No. 106-229, 114 Stat. 464 (2000) (codified at 15 U.S.C. 7001, et seq.), which applies to commercial transactions between the Government and private entities, similarly provides that

a signature, contract or other record . . . may not be denied legal effect, validity, or enforceability solely because it is in electronic form; and . . . a contract . . . may not be denied legal effect, validity, or enforceability solely because an electronic signature or electronic record was used in its formation. (15 U.S.C. 7001(a)(1) and (2) )

In support of these laws, the Office of Management and Budget (OMB) offers extensive guidance to assist federal agencies in the use of electronic forms, filing, and signatures with which to conduct official business. See e.g., http://www.whitehouse.gov/omb/fedreg/gpea2.html (OMB guidance to agencies on implementing GPEA); www.whitehouse.gov/omb/memoranda/m00-10.html (same); www.whitehouse.gov/omb/memoranda/esign-guidance.pdf (.pdf, 60 kb) (OMB guidance on E-Sign Act); www.whitehouse.gov/omb/memoranda/m00-15.html (same).

Record Retention

While the implementation of systems with which to accept electronic records has been largely left to the discretion of the federal agency, for purposes of the Copeland Act and the Davis-Bacon and Related Acts, agencies should be reminded that, in accordance with the Reorganization Plan No. 14 of 1950, reprinted in 5 USC Appendix, and in 64 Stat. 1267, they continue to act as the first level of enforcing authority for ensuring that appropriate records are maintained by the contractor and the employees are compensated in accordance with the Davis-Bacon Act. See 29 CFR 5.6. Moreover, because the use of such records may be required for litigation purposes, a reliable means of retrieving compliance documents collected and stored electronically should be included in any such methodology or arrangement.

In addition to filing requirements, contractors continue to have an obligation to retain records. The regulations state that: "Payrolls and basic records relating thereto shall be maintained by the contractor during the course of the work and preserved for a period of three years thereafter for all laborers and mechanics working at the site of the work . . . ." 29 CFR 5.5(a)(3)(i). Such records shall contain the name, address, and social security number of each such worker, his or her correct classification, hourly rates of wages paid (including rates of contributions or costs anticipated for bona fide fringe benefits or cash equivalents thereof . . .), daily and weekly number of hours worked, deductions made and actual wages paid. Id. The use of electronic signatures in no way negates the record keeping requirements and responsibilities outlined above.

Conclusion

Pursuant to the pertinent provisions of the Copeland Act and the GPEA, described above, accurate electronic signatures are sufficient for compliance purposes under the Copeland Act. However, all parties are reminded of the responsibility to ensure the accuracy of the electronic signature process, and the proper retention and accessibility of the resulting electronically transmitted documents.