When one company buys another, the deal team spends months on contracts, finances and systems. Form I-9 records often get a single line on a due diligence checklist, if they get one at all. That is a mistake. When you take on another company's workforce, you may also take on its I-9 history, including every missing form, late Section 2 and incorrect document entry.
The good news is that employers have clear options for handling I-9s after a merger or acquisition. The key is choosing one deliberately, applying it consistently and documenting what you did.
Why I-9s matter in a deal
Every employer must have a properly completed Form I-9 for each employee hired after November 6, 1986. In a merger or acquisition, the question is whether the employees who come over are "new hires" for the buyer or continuing employees of a successor business.
If the buyer qualifies as a successor in interest and the employees continue in their jobs without a break, the buyer can usually choose how to treat them. That choice decides whether the old forms carry forward or whether everyone completes a new Form I-9. It also decides who owns the risk in the old paperwork.
Option 1: Keep the existing Forms I-9
A successor employer may treat acquired employees as continuing in their employment and keep the Forms I-9 the previous employer completed. This is often the fastest path. Employees do not have to fill out new forms, and HR avoids a large onboarding project right after closing.
The catch is that the buyer also takes on any errors in those forms. If the seller's records are incomplete, late or wrong, those problems become the buyer's problems in an inspection. Keeping the old forms makes sense when due diligence shows the seller kept clean, complete records. It is a much harder choice when you have not looked.
If you keep the existing forms, you also inherit their reverification and retention dates. Make sure you receive the full records, including any Supplement B (or older Section 3) pages and any copies of supporting documents the seller kept, and that hire dates come over accurately so retention can be calculated correctly.
Option 2: Complete new Forms I-9 for acquired employees
The other path is to treat the acquired workforce as new hires and complete new Forms I-9 for them. This gives you a clean set of records that you know were completed under your own process. It also limits your exposure to the seller's past paperwork errors going forward.
This option takes more work. Each employee completes Section 1, and someone reviews their documents and completes Section 2 within the normal timelines that apply to new hires. For a large acquisition, that means planning staff, locations and schedules in advance so the work does not pile up.
One rule matters more than any other here: be consistent. If you choose to complete new forms, do it for all acquired employees, not just some of them. Selecting certain employees for new forms based on national origin, citizenship status or how they look or sound can create discrimination risk. Make the decision based on the group, not on individuals.
A middle path: review first, then decide
Many employers start with an I-9 review during due diligence and use the results to decide. If the seller's forms are in good shape, keeping them may be reasonable. If the review finds widespread problems, completing new forms or correcting the existing ones may be the safer choice.
If you keep the existing forms and find errors, you can correct them using the proper method: make the correction, initial and date it, and attach a note explaining what was fixed and why. Never backdate a form, and never use correction fluid or recreate an old form from scratch to make it look complete. Corrections should make the record accurate, not hide when the work was done.
What to look for in I-9 due diligence
When you review the seller's I-9 program, focus on these questions:
- Is there a Form I-9 for every current employee on payroll?
- Are Section 1 and Section 2 complete, signed and dated?
- Was Section 2 completed on time for each hire?
- Are any employees past a work authorization expiration date without reverification?
- Were the forms kept on paper, in an electronic system or both, and can the records be transferred intact?
- Did the seller use E-Verify, and are the case records available?
- Has the seller received a Notice of Inspection or any prior findings?
Write down what you find. The results may affect deal terms, such as representations, warranties or indemnities, which is a conversation to have with your legal counsel.
E-Verify after the deal
E-Verify adds another layer. If the buyer participates in E-Verify and treats acquired employees as new hires, those employees generally go through E-Verify like other new hires. If the buyer treats them as continuing employees, E-Verify generally should not be run on them as new hires, with special rules for certain federal contractors. Rules and the buyer's enrollment details matter here, so confirm the approach before running cases.
If the seller was enrolled in E-Verify, decide what happens to its account and records. Do not let them lapse without a plan.
Plan the I-9 work into the integration
I-9 work goes more smoothly when it is part of the integration plan instead of an afterthought:
- Add I-9 review to the due diligence checklist.
- Decide whether to keep existing forms or complete new ones, and apply that decision to everyone.
- Get the full I-9 records, including supplements and document copies, before systems are shut down.
- Bring over hire dates so retention and reverification dates stay accurate.
- Correct errors properly and document each correction.
- Settle the E-Verify approach before closing.
- Write a short memo describing what you decided and why.
That memo matters. If an inspection happens a year after the deal, you will want to show the choices you made and the steps you took, not reconstruct them from memory.
How Clear I-9 helps
Clear I-9 by TRAK gives you one place to bring every Form I-9 together after a deal. New forms are completed with electronic signatures and error checks that catch common mistakes before a form is saved. Workflows and tracking keep reverification and retention dates in view, a complete audit trail records every action and correction, and centralized reporting lets HR see records across every location and acquired entity.
Integrating a new workforce? Request a demo of Clear I-9 and we'll show you how to keep every record in order.
This article is for general information only and is not legal advice. For guidance on your specific situation, consult qualified employment counsel and the official USCIS resources.