Employer Sanctions

BACKGROUND

Congress adopted penalties for employers who hired illegal aliens in the 1986 Immigration Reform and Control Act (IRCA). The idea was that aliens would cease to come or stay illegally if they knew that employers would not hire them. The concept was right on target. In execution, however, the new system of sanctions was far off the mark.

The execution of the system is based on the completion of an INS form I-9 for all new employees which provides name, date of birth, address and Social Security number as well as identification whether the employee is a U.S. citizen, legal resident or nonresident alien. This information used to meet this requirement may be selected by the employee from a long list of identification documents, such as a driver's license, voter's registration card, passport, etc.

During the first two years after adoption of this new screening system, there was evidence that it was having some effect in reducing the lure of the U.S. employment market, especially along the U.S.-Mexican border. Apprehensions of illegal border crossers dropped off significantly. However, very quickly Border Patrol apprehension data began to show a resurgence in illegal entry. The reason the employer's sanctions system was not working was that a cottage industry in the production of counterfeit identification documents had mushroomed into a major illegal enterprise. When employers learned that the INS would not hold them accountable for employing illegal aliens if they had completed the I-9 screening process on the basis of counterfeit documents, and when the illegal aliens learned that employers would not scrutinize their counterfeit documents, the inexorable growing penetration of the U.S. workforce by illegal aliens resumed.

INS Aggravates the Problem

Independent evaluations of operations of the immigration authorities (now in the Department of Homeland Security, DHS), including that of the U.S. Commission on Immigration Reform, have concluded that the agency is suffering from "mission overload." There is no doubt that the INS is confronting an unprecedented challenge from the huge increases in legal and illegal aliens and in asylum applications, while having to cope at the same time with a huge increase in naturalization applications. Whatever the reasons, responsibility for locating and removing illegal aliens has been relegated to a very low priority, and that has not changed with the transition to the new DHS. The authorities insist that they still continue worksite enforcement operations where there are believed to be large concentrations of illegal alien workers. However, they all but admit that they give no priority to apprehending illegal aliens who don't fit one of those priority profile categories, such as deporting criminal aliens.

In 1994, the INS degraded its worksite enforcement operations significantly when it began use of what is now known as the Phoenix Plan. That operational posture allows the INS -- after reviewing an employer's I-9 files -- to inform employers that they appear to have illegal aliens on the payroll and to give them the opportunity to fire them, rather than to conduct work site raids to apprehend the illegal aliens and expel them from the country (through deportation or "voluntary departure"). The INS defended this method of work site enforcement as cost efficient, palatable to employers -- because they are better able to cope with what may be the forced separation of numerous employees -- and ultimately effective in causing the illegal aliens to go home when they lose their job.

The problem with the Phoenix Plan approach to worksite enforcement is that the illegal aliens are still in possession of their counterfeit documents and are able to use them to illegally gain new employment. Some employers have publicly complained that their former illegal alien employees have gone to work for their competitors.

Compounding the diminished threat to illegal aliens from INS worksite enforcement was a new operating instruction issued by INS Headquarters in May 1988 that prohibited any high-profile enforcement operation without a written plan and prior approval from the district or national headquarters. The instruction required that the INS inspectors "...avoid contentious circumstances (e.g., restaurants at peak service time...)" and routinely "...provide lists of unauthorized aliens to individual employers..." -- i.e., a reiteration of the Phoenix Plan. In addition, the INS inspections staff was tasked with developing and incorporating into their operations a "community liaison officer" to be present at any worksite enforcement operation. These instructions applied to all cases except the most egregious ones of deliberate exploitation of illegal aliens and criminality.

Halfway Measures

Even in cases in which the immigration authorities have evidence that employers are in violation of the law in employing illegal aliens--1an average between 1994-98 of 1,660 warnings and fines, which dropped to an average of 427 between 1999-20002--the agency tends to back off if an employer pleads ignorance of the law or fights a fine that has been imposed. Of the 15,000 cases, the INS imposed fines in only 3,765 cases--only one quarter of them. The amount of the assessed fines was $34.5 million, but the amount actually collected was only $14.5 million. Of the 10 largest fines assessed by the INS up to 1994, five ended up negotiated down to zero and the other five were reduced substantially.

Penalties for Hiring Illegal Aliens
(INA Section 274A)

Fines beginning at no less than $250 and up to $10,000 per alien may be assessed for knowingly hiring an illegal alien. The amount of the fee escalates depending on whether there are repeated violations. If there is found to be a pattern or practice of violations, employers may be sentenced to up to six months of imprisonment.

According to the INS, employers are routinely given the opportunity to negotiate a settlement of the fine levied against them, and most often ("99.5% of the time") they do so. In some cases, the employer may accept, as part of a negotiated settlement, to enroll in a program of checking the employment eligibility status of all new immigrant employees. In other cases, especially in the case of sweat-shops that exist only on the basis of exploiting illegal aliens, the company may simply close and move to a new location, beginning operations again under a new name. The INS also claims that it is hindered by inadequate resources in discharging its workplace enforcement responsibilities, with only 300 agents nationwide assigned to that responsibility. (See: The Orange County Register, August 30, 1998)

Is a Solution Possible?

In he 1996 Illegal Immigrant Reform and Immigrant Responsibility Act, (IIRAIRA) Congress recognized that the employers sanctions system was not working because of counterfeit documents and acted to correct the problem. However, instead of adopting a system of document verification, as was proposed, the legislative process watered down the proposal to a pilot project to test the feasibility of document verification--despite the fact that verification has been an on-going program for years for federal agencies required to screen out illegal aliens from federal benefits.

The pilot projects (there were three alternatives mandated--only one of which involves full-scale identity document verification) have been tested since 1997.  An outside evaluation of the program found that the Basic Pilot project is effective and met the needs of employers to ensure they had a legal workforce.  Nevertheless, in 2003 Congress extended the pilot project for an additional five years.  At the same time, the program was expanded from the handful of states where it was operating to become available nationwide during 2004. 

FAIR'S Position

FAIR is committed to making the ban on hiring illegal aliens work in the form that it was originally intended. At present, the system is not fair to employers. Those who seriously try to make sure that they are not employing illegal aliens run a much higher risk of penalties for discrimination against job applicants as a result of demanding proof of citizenship or legal residence. Those employers are also at a competitive disadvantage if their competitors can hire a cheaper workforce by looking the other way when an illegal alien employee presents false identification.

The way to make the system work efficiently and even-handedly is for the federal government to assume the responsibility for verifying which aliens are legally in the country and entitled to take jobs. That will remove the onus of possible employment discrimination from the employer and create a more level playing field among competitors. Several national commissions have come to the same conclusion and have so recommended to the Executive and Legislative Branches.

All that remains is for Congress to adopt it as a national mandatory program. However, for Congress to take action, it will need to feel enough public pressure for action to offset opposition from seasonal crop agriculture and other employers that have become addicted to cheap, easily exploited illegal workers.

Updated 3/05