Employers Are Targeted for Immigration and Customs Enforcement
by Candace C. Crouse

In fiscal year 2008, Immigration and Customs Enforcement ("ICE") made more than 6000 criminal and administrative arrests tied to workforce investigations. Of the 6000 people arrested, 135 were owners, managers, supervisors, and human resources employees. Many of these arrests came as the result of high-profile workplace immigration raids. A local example of such a raid took place in August 2007 at Koch Foods, a poultry processing plant, during which over 160 illegal employees were arrested. Due to the early intervention of Koch's attorneys, the company and its managers were able to avoid criminal charges.

In April 2009, the Department of Homeland Security ("DHS") provided new guidance to ICE about how to deal with illegal immigrant workers, directing ICE to focus on employers "to target the root causes of illegal immigration." As a result, ICE has increased civil audits of the hiring records of small, medium, and large businesses in order to ensure compliance with immigration laws.

The recent resolution of a federal criminal case against a South Carolina poultry processing plant and two of its managers for immigration violations exemplifies DHS's new immigration enforcement strategy. On the eve of trial, the defendants entered into a "diversion" agreement in which the company agreed to pay $1.5 million and was given 24 months to bring its hiring practices in compliance with federal law. If the company successfully complies with the terms of the agreement, the criminal charges will be dismissed. The U.S. Attorney for the case stated, "It was a combination of poor training in the human resources department and a bad compliance program… It was a systemic problem inside the corporation. The whole goal behind this prosecution was to bring this company into compliance with what [ICE] and our office considers to be good hiring practice."

For employers who want to comply with the law and avoid any civil or criminal sanctions, it is important to understand what DHS, ICE, and the Department of Justice consider to be "good hiring practice." In the current immigration climate, the answer is not always clear. On one hand, DHS expects employers essentially to act as immigration law enforcers, but on the other hand, employers are subject to laws that prohibit discrimination on the basis of national origin, color, or immigration status.

So what is an employer to do? The agreement reached by the South Carolina company provides some guidance. One of the requirements the government insisted upon was for the company to use DHS's "E-Verify" system - a free Internet-based system that allows an employer to verify an employee's eligibility to work in the United States. The E-Verify system is mandatory in some states (but not Ohio or Kentucky) and is required for certain employers with federal contracts. Although the E-Verify system is optional for most employers, DHS clearly views its use as a "good hiring practice.

Many employers do not use E-Verify because of implementation expenses and additional burdens that are imposed when it is used, including the requirement to allow the government to inspect the company's employment records with no prior notice. Also, E-Verify can only be used for new hires, not to verify the status of existing employees. Nonetheless, it is expected that E-Verify will become mandatory for all employers sometime in 2010.

The South Carolina agreement also requires the company to use the Social Security Number Verification Service ("SSNVS") to check the social security numbers of its current employees and to resolve any negative results in a timely manner. SSNVS allows employers to verify social security numbers of current or former employees, but it is illegal to use the service to verify the social security numbers of potential new hires. It is also illegal to immediately fire someone simply because their name and social security number do not match Social Security Administration records.

The South Carolina agreement requires the company to establish an internal training program, with annual updates, to instruct human resources employees on how to properly use E-Verify, complete I-9 forms, and detect fraudulent documents. Although the anti-discrimination laws tell employers to refrain from overzealous scrutiny of documents, ICE and the DOJ now require employers to make an effort to become better educated about the various government-issued social security and immigration documents.

Finally, the South Carolina agreement requires the company to utilize an external auditing firm to conduct annual Form I-9 audits. Employers are required to properly fill out and maintain an original form and supporting documentation for all employees for at least three years after the employee is hired or one year after termination, whichever is longer. Fines for a single, minor, technical violation can range from $110 to $1100.

Failure to comply with immigration laws can expose a company to a bad public image, substantial fines, debarment from government contracts, and even criminal prosecution. As the South Carolina case indicates, the government can also impose significant ongoing obligations as a part of a diversion or consent agreement. Companies are therefore well-advised to adopt good hiring and business practices in advance. The implementation of a compliance program that contains proper training and continuing education of human resources personnel, as well as a system to screen employment eligibility without engaging in discrimination, goes a long way to show federal and local authorities that an employer is attempting to comply in good faith with our immigration laws.

Candace Crouse is a member of Strauss and Troy's Corporate Compliance and Criminal Defense Department. She and attorney Martin Pinales were part of the Koch Foods legal team. Candace and other qualified attorneys assist companies with their immigration needs, including the implementation of immigration compliance programs. She can be reached at 513-629-9493.