Client Alert: Social Security "No-Match" Letters Are Back

The Social Security Administration (SSA) has resumed sending no-match letters to employers if an employee's name and/or social security number does not match the SSA records. For years, the SSA sent no-match letters (referred to by the SSA as "Decentralized Correspondence" or "DECOR" notices) to employers. The SSA stopped sending the no-match letters a few years ago after litigation was filed challenging a controversial proposed rule issued by the U.S. Department of Homeland Security relating to no-match letters. The proposed rule was eventually rescinded and the resumption of SSA no-match letters became effective as of March 22, 2011.

Unfortunately, the resumption of no-match letters creates questions for employers regarding how to respond to the letters. No-match letters normally provide that the employer does not have to respond to the letter. However, employers should not ignore the letters. Doing so may have serious repercussions.

The SSA has stated that a no-match letter is not a basis, in and of itself, for an employer to take any adverse action against an employee, such as laying off, suspending, firing or discriminating against an individual. In fact, there are a number of reasons why information reported to the SSA may not correspond with SSA records including, but not limited to, typographical errors, incomplete employer records, unreported name changes or even an error in the SSA records. Therefore, employers should not jump to conclusions about the reasons behind a letter.

Employers should develop a company-wide policy for uniformly handling all no-match letters and carefully follow the instructions set forth in the letters. The policy should ensure that all no-match letters are received, and/or forwarded to, one department for processing. According to the SSA, employers should take reasonable steps to resolve the mismatch and apply those reasonable steps uniformly to all employees.

Each case a business or individual may face is unique and may require legal advice. If you have questions about developing or updating your procedures for addressing "no-match" issues, or would like additional information regarding the content of this article, please contact a member of our Labor and Employment Department.