Family Justice Center

Archive for July 10th, 2010

Many states have enacted “mini-I-9” laws. Employers, especially companies that operate in more than one state, must closely monitor their compliance with the employment eligibility and verification laws for each state in which they do business.

The most common regulation states have imposed on businesses in recent years is requiring employers to use the federal E-Verify system to confirm workers’ immigration status and employment eligibility or work authorization, specifically illegal immigrant employment eligibility, work authorization and immigration status.

E-Verify is an Internet-based system operated by Department of Homeland Security (DHS/U.S. Citizenship and Immigration Services (USCIS) in partnership with the Social Security Administration (SSA). E-Verify is currently free to employers and is available in all 50 states. E-Verify provides an automated link to federal databases to help employers determine employment eligibility or work authorization of new hires and the validity of their Social Security numbers.

Employers or “Designated Agents” (e.g., payroll companies) must register online and agree to the terms of participation to use E-Verify. [Registration includes agreeing to the DHS/Immigrations and Customs Enforcement (ICE) Memorandum of Understanding (MOU). A discussion of the ICE E-Verify MOU is outside the scope of this post.]

E-Verify will soon be required of all federal contractors. DHS is now promulgating “final” E-Verify regs. I present an E-Verify overview and update in this post.

(The National Conference of State Legislatures does a remarkable job of monitoring these new developments and I include a variation of their chart and summary of the new state legislation below.)

Review of Relevant State Laws

State Laws Requiring Use of E-Verify

Arizona
Arizona

The Arizona Fair and Legal Employment Act (HB 2779), enacted in 2007, prohibits employers from knowingly hiring unauthorized workers and requires all employers to use the Basic Pilot Program to verify employment eligibility. It establishes substantial penalties and threatens noncompliant employers with suspension and potential revocation of their business licenses. Effective date Jan. 1, 2008.

Colorado
Colorado HB 1343 (signed 6/6/2006) prohibits state agencies from entering into contract agreements with contractors who knowingly employ illegal immigrants and requires prospective contractors to verify legal work status of all employees. The contractor must confirm that the Basic Pilot Program has been used to verify the status of all employees. If the contractor discovers that an illegal alien is employed, the contractor must alert the state agency within 3 days.

Georgia
The Georgia Security and Immigration Compliance Act, SB 529, covered employment, enforcement, and benefits and was signed by the Governor on April 17, 2006. The bill requires public employers, contractors and subcontractors with 500 or more employees to participate in E-Verify for all new employees beginning July 1, 2007. The law is phased in for public employers, contractors and subcontractors with 100 or more employees effective July 1, 2008; and for all employers by July 1, 2009.

Idaho Executive Order
On December 13, 2006, Governor Jim Risch issued an executive order requiring that state agencies participate in the E-Verify system. Also, all workers employed to the state through contractors must also be from companies that have been verified to have eligible employees.

Minnesota Executive Order
Governor Tim Pawlenty issued an executive order on Jan. 7, 2008, stating that all hiring authorities within the executive branch of state government as well as any employer seeking to enter into a state contract worth in excess of $50,000 must participate in the E-Verify program. The Executive Order’s effective date is January 29, 2008.

Mississippi
Mississippi SB2988 (signed 3/17/08) requires public and private employers to participate in E-Verify. The phase-in period is: all government agencies and businesses with more than 250 employees by July 1, 2008; companies with 100 to 250 employees by July 1, 2009; those with 30 to 100 employees by July 1, 2010; and all remaining companies by July 1, 2011. An employer violating the law is subject to the cancellation of public contracts, ineligibility for contracts for up to three years, and loss of business license for up to one year. The law also makes it a felony to accept or perform employment knowing or in reckless disregard of the immigrant’s ineligibility to work, with penalties from one to five years of imprisonment and/or $1,000 to $10,000 in fines.

North Carolina
All state agencies, offices, and universities must use E-Verify, required by SB 1523 in 2006. This applies to employees hired on or after January 1, 2007, except for employees of local education agencies hired on or after March 1, 2007.

Oklahoma
The Oklahoma Taxpayer and Citizen Protection Act of 2007 (HB 1804) addressed multiple issues: transporting and harboring, driver’s licenses, public benefits, law enforcement and employment. It made it a felony to transport or harbor unauthorized immigrants, with exceptions for health or benefits guaranteed by federal law. It requires public employers, contractors and subcontractors to participate in a federal electronic employment verification system and requires income tax withholding for independent contractors who do not have valid Social Security numbers. The law became effective Nov. 1, 2007.

Rhode Island Executive Order
On March 27, 2008,Governor Carcieri issued an executive order requiring executive agencies to use E-Verify; and for all persons and businesses, including grantees, contractors and their subcontractors and vendors to use E-Verify.

Utah
SB 81 was signed into law 3/13/08. The law address multiple issues, including driver’s licenses, law enforcement, harboring and transporting, public benefits and employment. It requires public employers to register and use the Basic Pilot program for new employees; state contractors must use Basic Pilot effective July 1, 2009. The law makes it a Class A misdemeanor to conceal, harbor, transport or shelter undocumented immigrants, though church, charitable and humanitarian assistance groups are exempted.
Encourages the Use of E-Verify (1)

Tennessee
HB 729, signed into law on June 26, 2007 and effective January 1, 2008 states that employers who “knowingly employ, recruit or refer for a fee for employment an illegal alien” are subject to a temporary suspension of their business license; repeat offenders are subject to a one-year suspension. Employers who comply with the requirements of the current I-9 process or who verify new hires through the E-Verify within 14 days of employment are shielded from sanctions.

One State Limits The Use of E-Verify
Illinois
Illinois enacted HB 1744, which bars Illinois companies from enrolling in any Employment Eligibility Verification System until accuracy and timeliness issues are resolved. Illinois also enacted HB 1743, which creates privacy and antidiscrimination protections for workers if employers participating in E-Verify don’t follow the program’s procedures.

State Laws Targeting Employers On Immigration Status

Current Litigation Over State Laws: Federal Pre-emption
Two lawsuits now making their way through the federal court system could restrict states’ ability to continue to crack down on businesses that hire unauthorized workers. One is a court challenge to the 2007 Arizona employer sanctions law filed by a coalition of Arizona trade groups. In February, a federal judge denied the coalition’s request to delay implementation of the law with a temporary restraining order, and the plaintiffs took their case to the U.S. Ninth Circuit Court of Appeals. Oral arguments are scheduled for this summer and a decision is expected in the fall.

Another lawsuit making its way through the federal courts originated last year in Hazleton, PA, where a local ordinance enacted in 2006 denies business permits to employers who hire illegal immigrants and fines landlords who rent to them. In a ruling issued last summer, a federal judge struck down the Hazleton ordinance, saying it treads on federal terrain and violates illegal immigrants’ constitutional right to due process.

The town is appealing the decision, and the case will be heard in the U.S. Third Circuit Court of Appeals this summer. A decision in this case is also expected in the fall.

If the two appellate courts hand down similar rulings; either both upholding the local laws, or both asserting federal authority, the battle over federal preemption could end there. But if the courts hand down opposing decisions – one supporting state authority and the other backing federal preemption – the debate will likely go to the Supreme Court. The consequence: no clear direction for state lawmakers for at least a year or two.

Many legal experts say the bills being passed in state capitals are not constitutional, and many of the new laws are being challenged in court. The U.S. Constitution gives federal law “supremacy” over state statutes. My personal understanding of the fundamental “pre-emption” issue is that the federal laws do not pre-empt these state laws. Frankly, this is a very complex constitutional issue.

The 1986 Immigration Reform and Control Act (IRCA) explicitly prohibits states from imposing sanctions on businesses that hire unauthorized workers. But one phrase in the 1986 law – a seven-word parenthesis allowing states some leeway in the matter of “licenses and similar laws” – has created a contested gray area.

Many states have taken the IRCA parenthesis to mean they have the authority to suspend or revoke the business licenses of employers who hire unauthorized workers. Businesses and many constitutional lawyers disagree.

“You have this complex overlay of statutes and regulations and court cases, and you’ve got this federalism question of what has traditionally been federal power and what the states can do,” Jan Ting, a Temple University law professor, told the Washington Post. “There could not be an area of law that is less clear than this.”

Because states have until recently stayed away from imposing sanctions for immigration violations, federal preemption has rarely been tested and few court precedents exist.

Private Rights of Action
While E-Verify requirements have so far proven the most popular method to deter the hiring of illegal immigrants, some states are beginning to make use of another tool: giving employees a “private right of action.” Oklahoma was the first state to pass such legislation, in 2007, allowing fired U.S. workers to sue their employers if unauthorized workers were subsequently found to be working in their place. Mississippi, Utah and South Carolina followed with similar provisions this year, allowing fired workers to sue if they are then replaced by illegal immigrants. Some say the laws could open businesses to lawsuits if they employ any unauthorized workers, whether or not they have hired them to replace fired legal workers. Other states are expected to adopt this approach next year.

Also still in place are provisions mandating that all businesses in Arizona enroll in E-Verify and allowing prosecutors to investigate anonymous tips made against businesses alleged to be employing unauthorized workers.

State Felony Laws
Companies should also be concerned about a Mississippi law that makes it a felony for illegal immigrants to accept unauthorized employment. Violators are subject to imprisonment from one to five years and fines of between $1,000 and $10,000. And while the measure seemingly applies only to unauthorized workers, if I had clients who do business in Mississippi I would be strongly cautioning them. I have many clients, both individual and business, where the kind employer assists driving the very good employee to work because the employee does not have a valid state driver license because s/he lacks immigration status. In my opinion a business can be prosecuted for aiding and abetting a felony or harboring a felon under this law.

Oklahoma also imposed felony penalties, in 2007 – in that case, against anyone caught transporting, concealing, harboring or sheltering illegal immigrants in any location,
including any building or means of transportation. Utah, Missouri and South Carolina passed similar measures this year, and many fear the provisions could be used against employers who knowingly hire unauthorized workers.

Under the Commonwealth Constitution, the Federal government has the power to make laws with respect to marriage. As such, the various States and Territories historically were left with the power to make laws dealing with matters arising out of the breakdown of de facto relationships, including parenting and financial issues.

In the mid 1980s various States and Territories conferred upon the Federal government the power to deal with parenting issues arising out of de facto relationships. Previously, contested parenting issues involving children from de facto relationships were dealt with in the State Civil Courts. After the Federal government acquired the power to deal with children of de facto relationships, all parenting disputes, whether arising from marriage or de facto relationships, were then dealt with in the Family Court jurisdiction.

Financial issues arising out of marriage relationships have always been dealt with in the Family Court. However, financial issues arising out of de facto relationships were historically dealt with in the State and Territory Civil Courts.

To add to the confusion of which jurisdiction to turn to in contested financial cases after the breakdown of a relationship, the Federal government established the Federal Magistrates Court in 2000. The idea was for the Federal Magistrates Court to deal with the simpler cases, whereas the Family Court was to deal with the more complex cases. Loose guidelines indicated which was the appropriate jurisdiction to deal with any particular case. However, those guidelines were not clear, and not consistently applied.

In late 2008 the Federal government passed legislation to amend the Family Law Act after various States conferred upon the Commonwealth the power to deal with financial matters arising out of de facto relationships.

This meant that any de facto relationship which broke down after 1 March 2009 would be subject to the new laws under the Family Law Act. Those new laws would treat financial issues arising out of the breakdown of de facto relationship on a par with marriage cases. Previously the economically disadvantaged party in de facto relationships usually achieved a poorer result in property settlements than in equivalent marriage cases.

This was seen as a sensible move as potentially de facto relationships which had broken down involving contested parenting and property issues could end up having parenting issues litigated in the Family Court/Federal Magistrates Court and financial issues in the State Civil Courts. Now all issues arising out of the breakdown of de facto relationships will be litigated in the Family Court or Federal Magistrates Court.

In a move which will relieve confusion over which jurisdiction in which to commence proceedings, it has been announced that in 2010 the Family Court and the Federal Magistrates Court will merge. The practical result of this will be that any contested parenting or financial issues whether arising out of marriage or de facto relationships, will now all be dealt with in the one Commonwealth Court rather than having to navigate the minefield of State Civil and Commonwealth Courts.