x Verifying Employment Using the Employment Verification (EV) - Spectrum Enterprises


Verifying Employment Using the Employment Verification (EV)

Written by Lainey Nadeau, Spectrum Enterprises

When verifying tenant income owners must use verification methods that are acceptable to HUD. The HUD Occupancy Handbook Chapter 5 states that written documentation sent directly by a 3rd party source is the preferred method of verification.  When dealing with employment income this is done using the Employment Verification form (EV).

The EV can be sent to the employer via mail, fax or email. The HUD 4350 states, “The applicant or tenant should not hand-carry the verification to or from the third-party source. If the verification does not contain an original signature or is delivered by the applicant or tenant, the owner should examine the document for evidence of tampering. In these situations, the owner may, but does not have to, accept the document as acceptable verification” (p. 5-53). The EV must be no older than 120 days before the effective date of the Tenant Income Certification.

Make sure you are familiar with the requirements of your state, company, owner & investor regarding employment verification. You may be required to use a certain EV form or you may be required to follow up to by obtaining a tax return, pay stubs or performing a telephone clarification with the employer.

  • Example, the California Tax Credit Allocation Committee requires all LIHTC projects to verify employment with an EV and 3 months of consecutive pay stubs.

If there is not a required EV your organization can create an EV or use the EV provided on the Spectrum Web site. I will be referring to the EV on the Spectrum Web site.  **

When you receive the EV back from the employer make sure it has been fully completed. If any questions have been left unanswered the manager must follow up with the employer to obtain the missing information or receive clarification as to why the information was not provided. Any follow up should be written on a separate clarification record in the file. The manager should never write on the EV.

  1. Make sure the Employee name written on the EV by the employer is the name of your tenant.
  1. Look at the applicant’s job title – this can be a trigger for additional questions.
  • Example:  Aubrey’s job title is “server” at the Dream Café.  As a server we would expect to see tips reported in addition to her regular wage. Even when tips are verified on the EV Spectrum recommends tenants complete a Tip Affidavit. This will verify any tips the applicant receives but that they do not report to the employer
  • Example: Ron’s job title is “Ed Tech” at Anytown School District. Often when someone works at a school they have their summers off. Did the employer indicate if the position was seasonal/sporadic? When work is seasonal/sporadic, Spectrum recommends the use of a Seasonal Worker Affidavit to determine the layoff period and any income received during the layoff period, such as unemployment benefits, gift income or working a 2nd job.
  • Example: David’s job title is car sales associate. This is a position that may receive bonuses or commissions. Check the EV to see if any bonuses or commissions are listed. If the employer lists commission/bonuses/tips as “approximately” or “it varies” follow up with the employer. In this instance the manager may want to request additional documentation such as pay stubs or a tax return from the applicant/tenant.
  1. Make sure the current wage or salary has been completed and that the frequency of the payment has been indicated. Know what the minimum wage is in your state and follow up with the employer if the EV lists an amount that is less than minimum wage.  To check the minimum wage law for your state go to www.dol.gov/whd/minwage/america.htm.
  • Example: Elaine is employed as a bookkeeper in Maine where the state minimum wage is $7.50/hr.  She does not receive any tips, bonuses, commissions and her work is not seasonal or sporadic. The EV shows she earns $290/wk and indicates that she works 40hrs/wk. $290/40=$7.25/hr which is less than minimum wage. The manager should call the employer and ask why Elaine is earning less than minimum wage.
  1. If the EV shows a tenant working in excess of 40 hrs per week we would expect that the hours over 40 would be subject to an overtime rate.
  • For example, Kenny works at Home Depot. He works 45 hours per week. The EV shows 40 hrs at $10/hr and 5 hrs at $15/hr. The Federal Minimum Wage Act of 2007 requires employers to pay employees not less than one and one‑half times their regular rate of pay for all hours worked in excess of 40 in a workweek, unless the employee is otherwise exempt.

    If the EV showed 45 regular hours instead of 40 regular and 5 overtime hours the manager would want to follow up with the employer to determine if 5 of the hours are subject to the overtime rate. If the EV showed an overtime rate less than one and one-half times their regular pay, the manager should follow up to determine why the OT rate does not comply with the Federal Minimum Wage Act.

  1. Some employees receive shift differentials for all or some of the hours they work.
  • Example:  Ann works as a CNA. She works 40 hours a week and her regular pay is $8/hr. Of those 40 hours 16 are worked on Saturday and Sunday. For those weekend hours she receives a shift differential of 50 cents/hr. Her earnings are ($8 x 40) + ($0.50 x16) = $328/wk.
  1. YTD income testing has become an industry standard. The EV should ask for YTD information unless your state has a policy saying YTD is not required. Spectrum recommends asking for the total YTD earnings and the dates and number of pay periods represented in those earnings. This allows the manager to make an accurate calculation of YTD income. If the YTD calculation is not consistent with the other information on the EV the manager should follow up with the employer.
  2. Some questions on the EV ask about the employee’s current income (ex. current wages) & previous income (ex. YTD). Remember the HUD Handbook 4350 defines annual income as “all amounts anticipated to be received from a source outside the family during the 12 month period following admission or annual recertification” (p. 5-3). That is why the question of anticipated changes on the EV is so important. The employer should list what the anticipated change is, the amount of increase/decrease, if applicable, and when the anticipated change is expected.


Here are some examples:

  • Helen works at a flower shop. Her hire date was 6/1/11 and she currently earns $8/hr and works 20 hrs/wk. She does not receive any OT, SD, commissions/tips/bonuses. The employer said she is eligible for a .50 raise on 6/1/12. Perfect. If the EV came back saying she was eligible for a raise on 6/1/12 but that the amount was “unknown” the manager would need to follow up to find out the anticipated amount of the raise.
  • Dwight works at a grocery store. His hire date was 2/23/2001. He does not receive any OT, SD, commissions/tips/bonuses. The employer wrote the following regarding an anticipated increase “increase unknown, annual review”. The manager would want to follow up with the employer to determine the amount of the anticipated increase. If the employer says the increase is still unknown the manager should ask what Dwight has historically received for a raise, since the EV states he has been employed since 2001.

Even though the 3rd party EV is the preferred method of verification, be aware of all information in the file and check for inconsistencies. The tenant may have reported her income to be higher on the application or her bank statements may show weekly direct deposit amounts that are higher than verified on the EV. These inconsistencies with the EV require that due diligence be exhibited and additional verification be obtained.

At first recertification always check the “Date First Employed” on the EV. If this date is before the move-in-date, but the tenant didn’t disclose this job at move in then there was unverified income at move in. This can affect eligibility and indicate fraud.


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