Employees, Employers - As introduced, beginning July 1, 2026, requires all state and local governmental employers to verify the work authorization status of each prospective employee through the federal E-Verify program prior to employment; authorizes the attorney general and reporter to enforce compliance with the requirement against local governments and subjects a noncompliant local government to the withholding of all funds of this state allocated to the local government via grant, contract, or statute, including, but not limited to, state-shared taxes. - Amends TCA Title 4; Title 5; Title 6; Title 7; Title 8; Title 12 and Title 50.

114th Regular Session (2025-2026) Introduced by Tim Rudd

Tennessee would require all public employers to use E-Verify for hiring starting July 2026, with state funding withheld from non-compliant local governments.

Transmitted to Governor for his action.

#employees #employers

Legislative bill overview

HB 1705 mandates that all state and local government employers in Tennessee use the federal E-Verify program to confirm work authorization for every prospective employee beginning July 1, 2026. The bill grants the attorney general enforcement authority and allows the state to withhold all state funding—including grants, contracts, and tax-sharing revenues—from local governments that fail to comply.

Why is this important

This legislation directly impacts hiring practices across Tennessee's public sector and creates significant financial leverage over local governments. The funding withholding mechanism is particularly consequential, as it could affect schools, municipalities, and counties' ability to operate core services if they don't implement E-Verify systems.

Potential points of contention

Implementation costs and burden: Local governments must establish E-Verify systems across all hiring, potentially requiring new software, training, and administrative personnel, with no funding mechanism provided by the state

Funding withholding severity: Withholding all state allocations (including education funding and tax-sharing revenue) for non-compliance may constitute punishment disproportionate to hiring violations and could harm essential services unrelated to hiring

E-Verify accuracy concerns: The federal program has documented error rates and can delay hiring; mandating it for all public employment may create administrative gridlock for time-sensitive positions like substitute teachers or emergency hires

Federalism and local autonomy: The bill removes local government discretion over hiring verification methods and employment practices, concentrating power at the state level through financial coercion