Dallas-Fort Worth Immigration Lawyer

The San Luis Obispo Tribune has an excellent article today on the potential impact of the government's new "no match" letters on employers. Here are excerpts:

Businesses across San Luis Obispo County are closely watching a federal court decision expected Monday that could lead to greater workplace enforcement of illegal immigration.

The decision involves the legality of a new U.S. Department of Homeland Security rule that focuses on a company's responsibility in verifying employment eligibility, based on letters that the Social Security Administration sends out.

"The rule has a lot of people fearful because there are many employers on the Central Coast that have received those letters in the past," said Richard Quandt, president of the Grower-Shipper Vegetable Association of San Luis Obispo and Santa Barbara Counties. "They assume they will receive them again."

At issue are new responsibilities that businesses would have to assume to verify the legal status of their workers. Failure to do so could subject a business to fines or even criminal charges, should an investigation be done and the firm be found to have knowingly employed workers without legal residency.

For nearly three decades, the Social Security Administration has contacted employees when their name and Social Security number do not match. Employers with more than 10 employees with mismatches also get a letter, also known as the "no-match" notification.

Until now, employers were recommended to not take any adverse action against an employee based solely on the letter.

But the nature of the letters is set to change as the government puts a greater onus on employers.

In August, Homeland Security announced that no-match letters would now be accompanied by notices from the U.S. Immigration and Customs Enforcement, the largest investigative arm of the department. Outlining what it calls a "safe harbor" for employers, the ICE insert identifies the necessary steps that will protect employers from civil fines or criminal charges.

Homeland Security clearly states that receiving a nomatch letter and not following the guidelines could be construed as knowingly employing illegal immigrants.

However, a lawsuit filed in late August by several labor union groups, including the AFL-CIO, halted distribution of the letters, which was set to begin in mid-September. The suit claims that the rules would violate workers' rights and unfairly burden employers.

A judge with the U.S. District Court for the Northern District of California then issued a nationwide temporary restraining order blocking the Social Security Administration from sending the letters with the inserts. The order is in effect until Monday, when another federal judge will decide how to proceed.

"It's important for employers to know we have dramatically increased enforcement, and are increasingly relying on criminal prosecution of businesses, as opposed to fining them, as we have done in the past," said Virginia Kice, a spokeswoman for ICE.

Indeed, work-site enforcement targeting illegal immigrants is up substantially in the last two years. Criminal prosecutions nationally have jumped from 25 in 2002 to 176 in 2005 to 742 in the first seven months of 2007. Felony charges that can be brought include harboring illegal immigrants, which carries a potential 10-year prison sentence, and money laundering, which can mean a potential 20-year prison term.

Homeland Security has also announced that in the near future, the penalty for this offense will increase by about 25 percent. Currently, the fines range from $275 to $2,200 per worker for the first violation and increase for additional violations.

"We have discovered that fines are not effective; many people consider that the cost of doing business," Kice said. "People should know we are also ready to seize a business's assets, as we have done in a recent case."

California businesses are set to receive most of the letters that are going to about 140,000 employers. The Social Security Administration has posted on its Web site that it intends to send out 35,675 nomatch letters to California employers this year for the 2006 tax year. That's nearly three times more than the next highest-scrutinized state, Texas. County-specific data are not available.

County employers--across industries such as agriculture, construction, lodging, restaurants and health care -- are confused and concerned about the rules and the extent to which they will be enforced.

"There is a fair amount of misunderstanding among employers about this rule," said Carl Borden, associate counsel with the California Farm Bureau Federation in Sacramento. He has been making presentations over the past month about the rule to agriculturalists throughout California, including a stop in Paso Robles.

"Merely failing to follow the rules doesn't in and of itself put them in jeopardy. But following it does protect them in the future," Borden said.

Borden explained that fear is one of the intended goals of the new rule.

"Regardless of how the court case turns, I'm sure we are going to see some high-profile enforcement actions," he said. "Part of that will be to scare all employers into thinking that they better follow the safe-harbor steps."

In announcing the rules, Secretary of Homeland Security Michael Chertoff acknowledged that the agency would "rely on a lot of self-policing" like with the tax code.

That's because the Social Security Administration is prohibited from sharing private data with other governmental agencies such as Homeland Security. No-match related fines and charges are anticipated to arise if there are employer audits or raids, Borden said. The letter is evidence of "constructive knowledge of an employee's lack of work authorization."

"There are some real enforcement issues with this," he said. "A lot of what it comes down to is deterrence."

That "puts the employer in the position of being the policemen," said Karen Ross, president of the California Association of Winegrape Growers.

Dana Merrill, president of Mesa Vineyard Management in Templeton, has attended four different presentations on the rule, and says he is still somewhat hazy on what is going to happen when the safe harbor timeline expires. His company employs about 150 people and hires an additional 200 workers through labor contractors during peak periods.

"I think employers want to do the right thing, but we're not clear what that is," said Merrill, who has received nomatch letters in the past. "We are hearing some pretty scary stories about what could happen to employers if we don't follow the steps, but I don't know if we'll get sued if we fire people."

Ross said that this is a common worry because employers must operate within strict parameters to avoid the potential of discrimination lawsuits. Homeland Security recommends employee termination if a Social Security mismatch can't be cleared up or the employee's employment eligibility is not re-verified within 93 days.

But the existing Social Security guidelines -- which remain unchanged--specifically state that employers should not use the letter alone "to take any adverse action against an employee, such as laying off, suspending, firing or discriminating against an employee."

"We have gotten so many calls and questions," Ross said. "Employers are scared. They are not sure how to act, and they are worried that employees will be scared away from the job."