On September 18, 2025, the Department of Justice (“DOJ”) announced a civil False Claims Act (“FCA”) settlement against a New Jersey shipbuilder to resolve allegations that it improperly employed unauthorized aliens to work on Navy ships. The settlement, which exceeded $4 million, is the second this year involving government contractors alleged to have employed unauthorized aliens in violation of FAR 52.222-54, Employment Eligibility Verification. With immigration enforcement squarely at the center of the current administration’s domestic agenda, government contractors should be mindful of this enforcement theory and take appropriate steps to ensure compliance and protect themselves from a costly FCA claim.
FAR 52.222-54, Employment Eligibility Verification
FAR 52.222-54, Employment Eligibility Verification, requires contractors and subcontractors to verify their employees’ employment eligibility in the federal E-Verify database. E-Verify is an internet-based system that compares information entered by an employer from an employee’s Form I-9, Employment Eligibility Verification, to records available to the U.S. Department of Homeland Security and the Social Security Administration to confirm employment eligibility.
When included in a government contract or subcontract, FAR 52.222-54 creates a general obligation for contractors and subcontractors to use E-Verify to confirm the employment eligibility of (1) all new employees working within the United States (regardless of...
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