Employment Development Department
Attn. Audit Section MIC 94
PO Box 826880
Sacramento, CA  94280-0001

Dear Tony Sunseri,
at (916) 464-2500,

Regarding our phone conversation on 1 PM, Friday Dec. 21, 2001, I would like either you, or someone within the EDD who is authorized, to provide me with written confirmation of the essential details of what you shared with me, stating the official policy of the EDD, and stating the laws which authorize the request and use of the social security number by the EDD, such as you quoted to me over the phone, which were Sec. 1211(b) of the Tax Reform Act of 1976, Title 42 USC 405 (c)(2)C, and public law Vol II 80-759 sec 12(e).  For your record, I also referenced the following laws when seeking an answer to my question:

26 USC Sec 6724 and Treas Reg 3016109-1(c) which are quoted below for your convenience:

26 USC Sec. 6724 :  "No penalty shall be imposed [to the employer] under this part with respect to any
     failure [to obtain a social security number from an employee] if it is shown that such failure is due to
     reasonable cause and not willful neglect."

Treasury Regulation 301.6109-1(c) provides: ... "When the person filing the return statement, or
     other document does not know the SSN of the other person, and has complied with the request provision
     of this paragraph, he shall sign an affidavit on the transmittal document forwarding such returns,
     statements, or other documents to the Internal Revenue Service so stating.  A payor is required to request
     the identifying number of the payee.  If after such request has been made, the payee does not furnish the
     payor with an identifying number, the penalty ($50.00) will not be assessed against the payor, if it is
     shown that such failure is due to reasonable cause and not willful neglect."

Since I will be seeking employment in the State of California in the future, and since I do not use the social security number, this issue may come up again for me, and thus, I will most likely have to address this issue again with future employers.  So that I will not have to bother calling the EDD (speaking first to a customer service rep, and then an auditor, and then a supervisor such as yourself) each time I seek employment, I would like official written answers to the following questions:  (Please note that I am not asking for legal advice.  Please refrain from offering legal advice, and refrain from addressing issues such as the I-9, but stick only to issues having to do with EDD policy, and the laws authorizing the EDD to act with respect to such issues regarding the Social Security number.)

1.  What EDD penalty, if any, would there be to employers in the State of California, who, according to the laws above, show that they asked an employee for a Social Security Number, and were unable to actually get a number from an employee?   What is an employer required to do to show that "such failure is due to reasonable cause and not willful neglect" in the event that they are unable to get a number from an employee after asking for it?

2.  Does the EDD actually require and/or mandate that all employers in the State of California only employ people who have social security numbers?

3.  If an employer refuses to hire a person who does not have a Social Security Number, and the employer makes that decision based on a claim that the Social Security number is required for all employees in the State of California by the EDD, is that employer acting on what the EDD and/or what the law tells them to do, or is that employer acting on their own?

Thank you very much for your time and effort on my behalf.
 
 

Sincerely,
 
 

Jason Hommel