CAMBIO de COLORES 2003

 

Latinos in Missouri:

Neighbors in Urban and Rural Communities

 

Employment Panel

The Latino Workforce: Its Contributions and Potential

 

 

Wednesday, March 12, 2003

 

Impact of the U.S. Immigration Law on the Latino Workforce

 

Presented by

 

Attorney Mira A. Mdivani

 

Immigration Law Practice

The Law Firm of Klamann & Hubbard, P.A.

7101 College Blvd., Suite 120, Overland Park, KS 66210

(913) 327-7600

www. kh-law.com/immigration

 

 

 

 

 

 

 

 

 

 

 

Table of Contents

 

I           Introduction: The Hispanic Workforce in Kansas City and the Issue of the Undocumented

Workers

 

II.         Undocumented Workers Are More Vulnerable to Discrimination and Unlawful Labor    Practices after the Supreme Court Decision in Hoffman Plastic Compounds

 

III.       IRCA Compliance and Employer Sanctions

 

IV.       Use of RICO in Criminal and Civil Suits Based on Employment of Undocumented Workers

 

V.        Solutions Available Under Current Laws and Needed for the Future

 

VI.              Conclusion

 

                                                           

I.          Introduction: The Need for the Hispanic Workforce in Kansas City and the Issue of       the Undocumented Workers

 

            Federal Reserve Chairman Alan Greenspan told Congress on February 12, 2002: “Short of a major increase in immigration, economic growth cannot be safely counted upon to eliminate deficits and the difficult choices that will be required to restore fiscal discipline.”  Many U.S. businesses do not need to read Chairman Greenspan’s monetary policy report because they know that many of their businesses simply would not survive without the immigrant workforce.  Under various estimates, up to 20% of the U.S. workforce is employed without authorization.  Construction, food preparation and processing, hotel, landscaping, cleaning, fruit and vegetable picking - the list goes on.   At the same time, for political and other reasons, while Chairman Greenspan and other leading economists acknowledge that we need immigrant labor, Congress is reluctant to adopt a guest worker program or change existing inflexible work visa categories. 

 

            How does this need for immigrant labor impact Kansas City?   A recent study of the Hispanic population of Kansas City conducted by El Centro, Inc. shows that almost fifty per cent of survey respondents in that study arrived in the United States with legal immigration permission, but approximately 76% of those employed were working without authorization.   While jobs are readily available for these immigrants, lack of employment authorization clearly steers them into low-paid employment categories.  Serious issues arise in this context: undocumented workers often take jobs without benefits.  Only 6% of all respondent in the El Centro study received full benefits, such as heath insurance, disability, retirement, maternity leave, and paid vacation.  Many are driven away from their existing jobs by the “no-match” letters instituted by the Social Security Administration, by the fear of the INS raids and deportations, and by discrimination, which is reported by 26% of the El Centro study participants.    It is crucial to understand that without obtaining legal status in the United Status, undocumented immigrant workers cannot be protected and cannot reach their full potential.

 

II.         Undocumented Workers are More Vulnerable to Discrimination and Unlawful Labor                 Practices after the Supreme Court Decision in Hoffman Plastic Compounds                      

 

            In a 2002 decision, the U.S. Supreme Court’s Chief Justice William Renquist summarized the court’s view on whether an undocumented worker is eligible for back pay or reinstatement for being illegally fired by his employer:

 

            On the final day of the hearing, Castro testified that he was born in

            Mexico and that he had never been legally admitted to, or authorized to

            work in, the United States. . . . Neither Castro nor the Board’s General

            Counsel offered any evidence that Castro had applied or intended to

            apply for legal authorization to work in the United States.   Based on this

            testimony, the ALJ found the Board precluded from awarding Castro

            back pay or reinstatement... (Emphasis added).

 

             The astonishing part of this opinion, reversing the long-standing Supreme Court’s precedent in Sure-Tan, Inc. v. NLRB , is Chief Justice Rehnquist’s use of the lower court’s finding that “[the illegal alien] has not offered any evidence that [he] had applied or intended to apply for legal authorization to work in the U.S.” as a relevant factor in arriving at a decision. The Chief Justice used this finding to support the Court’s decision to affirm the lower court’s denial of the worker’s claim for back pay and reinstatement.  In fact, it appears that the Chief Justice was not aware that there is no law which could have allowed this particular “illegal” alien to “apply or intend to apply” for legal work authorization.   In fact, Hoffman Plastic Compounds, the very employer who illegally fired the worker in this case, was the only party who could have applied for a temporary work visa or an employment-based green card for Mr. Castro.  Instead, the employer chose to continue to employ the alien illegally and use the fact that the worker was undocumented, to fire him in violation of federal law.  The Supreme Court sided with the employer: while finding that the termination was illegal, the Court said that it would be a violation of our immigration policy to award an undocumented worker back pay and reinstatement.  The Court said that the only punishment the employer deserves in this case is a small fine.    After the Hoffman Plastics decision, many immigrant rights advocates are left to wonder whether other anti-discrimination and illegal employment practices laws are any more effective tools in protecting the rights of undocumented workers.  

 

III.       IRCA Compliance and Employer Sanctions

 

                        1.         IRCA Compliance

 

                        The Immigration Reform and Control Act (IRCA) makes it illegal for an employer to hire, recruit or refer for a fee someone not authorized to work.   The statute covers employers who are natural persons and business entities.   Successor employers who retain a predecessor’s employees are either responsible for executing new I-9s or are liable for predecessor’s failure to complete or defective completion of I-9s.   An employer violates the Immigration and Naturalization Act where:

 

            (i)         It employs an alien knowing that the alien is not authorized to be                                                            employed under the Immigration and Naturalization Act or by Attorney

                        General.

 

            (ii)        It continues to employ an alien knowing that the alien has become unauthorized.

 

            Where the employer is informed that the employee is or may be unauthorized to work by the INS, it must inquire further because it is on constructive notice of unlawful employment .   Actual knowledge is not required, the “should have known” standard is applied where the employer fails to verify and re-verify the employee’s status to determine the continuing validity of the employee’s employment authorization.  The INS regulation adopts a broad view in its definition of “knowing” as including “not only actual knowledge, but also knowledge which may be fairly inferred through notice of certain facts and circumstances which would lead a person, through the exercise of reasonable care, to know about a certain condition.”   Under INS regulation, knowledge may be inferred where the employer fails to complete or improperly completes an I-9; has information available to it that the indicated employee is not authorized to work; or acts with reckless disregard by permitting another individual to introduce unauthorized workers to the work force.  However, knowledge cannot be inferred from an employee’s foreign appearance or accent.

 

            (iii)       Immigration and Nationality Act is violated where the employer fails to                                       comply with the IRCA-imposed verification system.

 

            Under IRCA, the employer must attest under penalty of perjury on INS Form I-9 that an employee produced either documents establishing both employment authorization and identity or separate documents evidencing employment authorization and documents establishing identity.   It is the employer, and not the employee, who is liable for any defects in the completion of section 1 and defects in the completion and accuracy of section 2 of Form I-9.  The examination and verification of documents should take place within three days of the hiring date.   While demanding compliance, IRCA at the same time prohibits the employer from requiring or specifying which documents an individual is to present.  This would constitute a violation of the Unfair Immigration Employment Practices provision.   Employers must retain I-9s for three years after the date of hiring or referral or one year after the worker’s employment is terminated, whichever is later.  If a worker’s employment authorization expires or the INS informs the employer that the authorization is not sufficient, the employer must re-verify the I-9 or be on notice that the person is not eligible for employment.     It is important to note that false attestations on Form I-9 are a separate criminal offense.  In addition, it may be treated as a crime of misrepresentation to federal officers.

 

                        2.         Civil Penalties

 

                        Civil penalties under IRCA for employing an unauthorized alien (excluding paperwork violations) include:

 

                        First offense:                 $275.00 to $2,220.00 for each alien;

 

                        Second offense:            $2,200.00 to $5,500.00  for each alien;

 

                        Subsequent offenses:     $3,300.00 to $11,000.00 for each alien.

 

            In addition, fines may be imposed for paperwork violations, i.e. failure to fill out and maintain I-9s correctly, in the amounts of $110.00 to $1,100.00 for each I-9 form.  

 

            Defenses and mitigating circumstances may include: the size of the employer, good faith of the employer, seriousness of the violation, employee in fact being authorized to work, and any history of previous violations by the same employer. 

 

            Any federal contractor may lose its right to do business with the federal government for IRCA violations under Executive Order 12989 (Feb. 13, 1996).

 

 

IV.       Use of RICO in Criminal and Civil Suits Based on Employment of Undocumented                     Workers

 

            In 1996, the Illegal Immigration Reform and Control Act made employment of workers without employment authorization a predicate offence under The Racketeering Influenced and Corrupt Organization Act (“RICO”).   Since 2001, civil and criminal suits involving prosecution of employers who hire undocumented workers, have been changing the way employers are looking at such practices.

 

            A.        Criminal Prosecution of Tyson Foods Under RICO

 

            Criminal penalties, including up to $3,000 and/or six months in jail,  may be imposed under 8 CFR §274a.10 if a “pattern and practice” of IRCA violations is found.   It is also a criminal offense, under 8 U.S.C1325a(a)(3)(A), carrying a penalty of up to five years in jail for “any person who during a twelve month period knowingly hires for employment at least ten individuals with actual knowledge” that these individuals are not authorized to work and where such individuals were brought to the U.S. in violation of 18 U.S.C.§1324.  These laws were used by the Department of Justice to file a federal suit at the U.S. District Court for the Eastern District of Tennessee against Tyson Foods, Inc., the world’s largest producer of poultry products, for alleged participation in a scheme to smuggle and employ illegal aliens.   In December of 2001, after Tyson refused to settle the case for One Hundred Million Dollars, the charges resulted in the grand jury’s  thirty-six count indictment against the company’s executives and managers.   INS Commissioner James Ziglar said in the Department of Justice Release on December 19, 2001:

 

            “This case represents the first time INS has taken action against a company of Tyson’s              magnitude.   INS means business and companies, regardless of size, are on notice that the            INS is committed to enforcing compliance with immigration laws...”  

 

            The Tyson case is now in trial and we are awaiting its results.  Meanwhile, similar indictments across the country have businesses fear treble damages, forfeiture of their plants and imprisonment of their management personnel based on their employment of undocumented workers. 

 

            B.         A Group of Companies Wins a RICO Appeal Against a Competitor

                        Based on Allegations of Hiring  Illegal”Aliens

 

            The Second Circuit’s recent decision in Commercial Cleaning Services, L.L.C v. Colin Service Systems, Inc. may have opened the door to a new kind of liability, i.e. treble damages under RICO for employment of workers who are not authorized to work in the United States.  Commercial Cleaning Services, L.L.C (Commercial), a small cleaning services company, together with similar firms, filed a class action law suit again Colin Service Systems, Inc. (Colin), one of the nation’s largest corporations engaged in the business of cleaning commercial facilities.  The class action complaint alleged that Commercial and the members of the plaintiff class are victims of Colin’s pattern of racketeering activity in violation of 18 U.S.C §1962(c), referred to as the “illegal immigrant hiring scheme.” The theory of the case was that Colin obtained a significant business advantage over the firms in the “highly competitive” and price-sensitive cleaning service industry by hiring “hundreds of illegal immigrants at low wages.”  The complaint alleged that Commercial lost its lucrative cleaning contract with Pratt & Whitney because of Colin’s illegal immigrant hiring scheme.   The complaint referred to the hiring at least one hundred and fifty undocumented workers, continuing to employ aliens after their work authorization had expired, and failing to prepare, complete, and update employment documents.   The allegations asserted that Colin was part of an enterprise composed of entities associated-in-fact that included employment placement services, labor contractors, newspapers in which Colin advertised for laborers, and others.   The complaint alleged that Colin’s participation in the enterprise through the illegal immigrant hiring scheme violated 8 U.S.C. §1324(a), which prohibits hiring certain undocumented aliens, and which is a RICO predicate offense if committed for financial gain.  

 

            The Second Circuit reversed the lower court’s decision to dismiss the claim and allowed the class action to go forward.  The  found that Commercial was directly injured by Colin’s unlawful hiring scheme.  If successful on remand, Commercial Cleaning could recover damages of three times its actual losses under RICO’s civil remedy provision, in addition to having stopped the alleged unlawful activity.  The decision may have an impact beyond a competitor’s use of illegal aliens.  RICO applies to any party that has maintained an enterprise and caused injury through a pattern of racketeering activity.   A pattern of racketeering can involve repeated violation of a long list of federal laws, including mail and wire fraud.  As a result, the Commercial Cleaning decision may provide additional grounds for civil and criminal liability.

 

            C.        U.S. Workers Sue Their Employer in a RICO Class Action Suit for the Use of                                      Unauthorized Workers Employed by an Employment Agency

 

            Until now, the Second Circuit was the only appellate court to have considered allegations of illegal immigrant hiring as a predicate offence for standing to sue under RICO.   In June of 2002, as part of a CLE presentation for the Kansas City Metropolitan Association, I predicted that Commercial Cleaning was a ticking bomb, and that we would hear about this case soon.   The Mendoza v. Zirkle Fruit Co. decision was released for publication on September 3, 2002.   In that case, the Ninth Circuit, citing Commercial Cleaning, predictably held that allegations of illegal immigrant hiring may serve as a predicate offence for a RICO claim, under a set of facts that must serve as a wake-up call to all employers.  

 

            Washington state’s apple growing industry generates over $1 billion a year.   There are more than 30,000 orchard pickers and 15,000 fruit packers who work in the apple orchards every year.   The Immigration and Naturalization Service conducted investigations finding that as much as half the growers’ workforce is employed illegally.    The Mendoza v. Zirkle Fruit Co. complaint alleged that fruit growers, Zirkle Fruit Company and Matson Fruit Company, had knowledge of illegal harboring and/or smuggling of undocumented workers.   According to the complaint, the illegal scheme was facilitated by Selective Employment Agency, Inc., a separate company that employed the illegal workers.   It is important to note that the U.S. workers did not sue the employment agency, but went directly after their own employers.   The court held that knowledge of illegal employment alone was sufficient to allege the predicate act of knowingly hiring undocumented workers, as required to state a claim under RICO.    This point cannot be emphasized enough: a company may be found liable not only for hiring or continuing to employ unauthorized workers, but under Mendoza, may be found liable if the company knowingly uses somebody else’s unauthorized workers.

 

V.        Solutions Available Under Current Law and Needed for the Future

 

            While far from perfect (and sometimes rather maddening), the immigration law as it exists now provides limited solutions to questions raised by the need to employ foreign workers. 

 

            A.        Work Visas and Employment-Based Green Cards

 

                        1.         Essential Workers: H-2B

 

                        H-2B category may be useful in cases where employers experience shortages of workers in some occupations, as long as they can prove that their need is temporary.   It is available for workers performing “agricultural labor or services . . . of a temporary nature,” or for those engaged in “other temporary services or labor.”   In order to obtain an H-2B classification for a foreign worker, an employer must be able to demonstrate that the position offered is (1) of a seasonal nature, e.g. landscape workers; (2) a one-time occurrence, e.g. a foreign chef specializing in French cuisine coming to a restaurant to train its workers in the preparation of pastries; or (3) a peakload or an intermittent need.   

 

            The advantages of the H-2B category are that despite the annual numeric limitation (66,000 visas available annually), visas are almost always available, and the application process is relatively fast.  Another advantage is the ability to bring the worker’s family to the United States legally while the primary H-2B worker is employed by the sponsoring company.   The weak points include having to go through a temporary labor certification, which involves the  additional expense of advertising, the short duration of H-2B visas (up to one year),  and the fact that many of the jobs do not fall squarely into this limited category. 

 

                        2.         Agricultural Workers: H2A

 

                                    Agricultural employers may bring workers from abroad on H-2A visas.  H-2A visas allows employment for seasonal purposes, such as harvesting crops.

 

                        3.         Employment-Based Permanent Residency

 

                                    Temporary work visas such as H-2B or H-2A are limited in their application.   In cases where no visa will work, employers may consider finding qualified workers abroad and sponsoring green cards for them before the workers arrived in the United States.   In addition, in cases where temporary work visas have been used, employers do not find it reasonable to lose a valuable worker who has several years of experience on the job, and they would like to have the worker available to them on a permanent basis.  Many companies choose to sponsor their foreign workers for employment-based permanent residency (“green card”).  Depending on the job offer (which determines the immigration category), the location of the offered job, and on whether the worker with an approved immigrant visa petition chooses to ask for an immigrant visa at a consulate or apply for adjustment of status in the United States, the process may take from a few months to several years.   An alien does not have to be in the United States while a U.S. company is applying through the labor certification and immigrant visa petition.   However, if the alien is in the United States, it is important to maintain a valid non-immigrant status in order to be eligible for adjustment of status or to avoid being subject to any entry bars if the employee wants to apply for permanent resident status by a U.S. consulate abroad.                      

 

 

            B.         Obtaining Legal Status Through Family

 

                        The El Centro 2002 Study shows that 85% of the undocumented Latinos in Kansas City live in “mixed” family, meaning that some members of the family are either legal permanent residents or U.S. citizens.    In some cases, legal status for the undocumented members of the family could be achieved through those who are in the United States legally.  There are many barriers to obtaining legal status: long delays caused by the unavailability of immigrant numbers for many categories of immigrants, lack of information about immigration benefits which may be available to immigrants, misinformation, and lack of access to qualified legal help.   However, it is encouraging to know that approximately 85% of the Latino population in this city may have a chance eventually to receive their green cards through their family.   Much work needs to be done by the Hispanic organizations to explain the availability of immigration benefits and improve access to qualified legal help. 

 

            C.        Other Grounds for Obtaining Legal Permanent Residency or

                        Employment Authorization

 

                        Other grounds for obtaining legal permanent residency in the United States include asylum, refugee status, work authorizations granted under Temporary Protected Status (TPS), issued to students on student visa if they show economic hardship, and in other cases. 

 

            D.        Needed Solutions

 

                        New legislation is needed at the federal level to change the status quo.  Hispanic organizations and businesses who depend on their immigrant workforce should lobby Congress to find sensible solutions to the issue of the undocumented workers in America.   Such solutions may include expanding current work visa categories or creating a guest visa program for the much-needed immigrant workers.  

 

VI.       Conclusion      

 

            The key to improving our economy lies in embracing and nurturing the immigrant workforce.   Legalizing undocumented Latino workers is at the heart of this issue.  It is also the key to providing Latino workers with the protection of U.S. human rights and labor laws, and to creating stable communities in Missouri and throughout the United States.  Hispanic organization should get involved in educating immigrants and their employers about available work visas and employment-based green cards, should work on availability of qualified legal advice to immigrants who are eligible to adjust their status based on family relations, and should lobby Congress to change the existing laws to acknowledge and legalize the undocumented Hispanic workforce in this country.