You’ve decided to hire a new employee. The interviews are complete, you’ve chosen the person you think is both most qualified and the best fit for your business’ culture. The new guy is enthusiastic and ready to get started. Then you ask the magic question: “I’ll need your social security number for payroll.” Your new employee responds: “I do not have a social security number and have no intention of obtaining one because it is against my religion and you have to accommodate my religious convictions.”

You already know that all U.S. citizens and alien residents are required to file tax returns and that employers must withhold taxes from both citizen and alien employees’ wages “at the source” through the mechanism of IRS Form W-4. 26 U.S.C. §3402(a)(1); 26 C.F.R. §§31.3401(a)-1, 31.3402(b)-1, 31.3402(f)(5)-1(a). An employer who fails to collect the withholding tax is liable for the amount of the tax (not just a fine). 26 U.S.C. §3403 (“the employer shall be liable for the payment of the tax required to be deducted and withheld”); 26 C.F.R. §31.3403-1. To identify the wage earner, Form W-4 includes a block for the employee’s social security number, which is also his taxpayer identification number.

In other words, the employee is required by law to provide a SSN when filling out tax documents, and the employer is required by law to request and obtain a SSN from the employee for the purpose of withholding taxes on his or her behalf. The only exception to the SSN requirement is the use, in the alternative, of an IRS Individual Taxpayer Identification Number (ITIN). However, one can only obtain an ITIN if one is not eligible to obtain a SSN and, all U.S. citizens and virtually all legal residents are eligible for an SSN. But you can’t refuse to hire someone based on religion? Can you?

The U.S. Supreme Court has held social security’s withholding system uniformly applicable, even where an individual chooses not to receive its benefits. “The tax system imposed on employers to support the social security system must be uniformly applicable to all, except as Congress provides explicitly otherwise.” (United States v. Lee 455 U.S. 252, 261 (1982)) “We note here that the statute compels contributions to the system by way of taxes; it does not compel anyone to accept benefits.” (Lee at 261 n. 12.)

An IRS Form 4029 will permit the employee, under very limited circumstances, to be exempt from social security taxes in exchange for a waiver of rights to all benefits. However, Form 4029 requires certain requisites, including that both the employee and the employer be members of a religious group that is conscientiously opposed to social security. In any case, Form 4029 will not exempt one from income taxes, and even when applying for a waiver pursuant to Form 4029, one is required to provide a SSN, or to apply for one concurrently.

In Cheek v. United States 498 U.S. 192 (1991), the U.S. Supreme Court set forth in no uncertain terms that: “Because both citizens and resident aliens must comply, an employer’s insistence that an employee complete IRS W-4 does not imply citizenship status discrimination.”

In Hover v. Florida Power & Light Co., Inc. 1995 WL 91531 (S.D.Fla.) aff’d, 101 F.3d 708 (11th Cir.1996), the court explicitly rejected a free exercise of religion challenge. There, the plaintiff brought a Title VII employment discrimination claim against the defendant employer for requiring him to provide a SSN on certain tax and employment documents as a condition of employment, in violation of his religious belief that a SSN constituted the “mark of the beast.” The court found in favor of the defendant, ruling that:

“[R]equiring PSESI to intentionally violate the Federal Regulations referenced hereinabove in order to ‘reasonably accommodate’ the Plaintiff’s religious preferences is unreasonable in and of itself. If the employer cannot accommodate a religious practice without undue hardship, the practice is not a protected religion within the meaning of Title VII of the Civil Rights Act.”

In Bright v. Bechtel Petroleum, Inc. 780 F.2d 766, the Ninth Circuit stated that: “Under 26 U.S.C. §3402, an employer has a mandatory duty to withhold federal income tax from and employee’s wages where required by applicable regulations…. This circuit has repeatedly held that an employer is not liable to an employee for complying with its legal duty to withhold tax.”

In Toussaint v. Tekwood Associates, Inc. 1996 WL 670179 (O.C.A.H.O.), the hearing officer concluded as follows: “It is undisputed that Tekwood withdrew its offer of employment because Toussaint did not provide it with a Social Security number. Toussaint asserts that no law requires him to have a Social Security number. However, that contention is irrelevant to this matter. As previously stated, nothing in IRCA limits an employer’s ability to require a Social Security number as a pre-condition of employment. As the facts regarding the request are not in dispute, and as Toussaint has not presented any evidence in the form of an affidavit to show that Tekwood applied this requirement in a discriminatory manner, (i.e. requiring only United States citizens to provide a Social Security number), he has failed to state a claim upon which relief can be granted because he has provided no evidence that Tekwood’s asserted legitimate, non-discriminatory reason for its failure to hire was a pretext for discrimination. Therefore, with respect to his claim of citizenship status discrimination, Toussaint has failed to state a claim upon which relief may be granted.”

Similarly, the hearing officer in Lewis v. McDonald’s Corporation 2 OCAHO 383 (1991) found that: “The public policy against immigration-related discriminatory practices is strengthened by prohibiting a prospective employer from demanding any particular document to satisfy employment eligibility verification requirements, e.g. a Social Security card. That policy is not enhanced, however, by prohibiting an employer from demanding a Social Security number. Nothing in the logic, text or legislative history of IRCA hints that an employer may not require a social security number as a precondition of employment.”

In conclusion, an employer is not only within its rights in denying employment if an employee refuses to provide a valid SSN, but is obligated as a matter of law to require a prospective employee to provide a valid SSN before employing an individual.

Hiring, firing, contracts, corporate procedures, wages, salaries, vacations, office and retail leases, sick leave, benefits, everything you do in business today involves the law and this is just one more example of the legal consequences should you take the wrong step.