Hopes, wishes and E-Verify

When we were out at the SHRM conference in Hattiesburg, we had the chance to sit next to an attorney who specialized in labor law. “Hell,” he said, “we have no idea what this law’s going to do.”

We had another conversation with an attorney there this week (a different one, but still a labor attorney). He’s hopeful, he said, that there will be a lawsuit. “But let’s be honest,” he continued, “any time that you’re hoping for a lawsuit to fix things, you’re in a bad spot.”

We tend to agree. Mississippi is now less than a month away from the first stage of implementing the Employment Protection Act. Most of the business owners we’ve talked to keep hoping, rather than planning.

If you’re an employer in Mississippi, here’s what you should be doing right now:

1. Figure out what solution is right for you (i.e., the free government version or our premium version)

2. Get signed up and ready so those July 3rd hires don’t get you in trouble. If you use the government version of the interface, each user has to sit through a tutorial and pass the Mastery test before being able to use the system. That’ll take a couple hours. Or you could just use us, and you won’t have to do that.

Either way, if your company is in the first phase of MEPA, you need to stop wishin’ and start doin’.

The tide rolls on

Back from short break …

Lots of E-Verifyish news here. Missouri and Rhode Island have both passed laws requiring the use of E-Verify for a majority of employers. Suffolk County, N.Y. passed its own employer-sanctions law. Washington County, Utah officials are discussing doing the same.

Setting aside the emotional pro/con arguments, the trend we’ve noticed continues: more and more jurisdictions are passing laws that are dependent on E-Verify.

Which makes it all the more interesting that E-Verify needs to be reauthorized in November. That debate’s going to be bloody, where everyone invokes “the will of the people.”

Figuring ‘The Gap’

The Immigration Policy Center put out a report this week on E-Verify in Arizona. It was a scathing report about how the system has failed, based on news report. We think it’s about as authoritative as the U.S. Chamber of Commerce study that came out in late April that said a whole bunch of Americans would lose their jobs if mandatory employment eligibility measures were put into place.

Our fairness disclaimer: Our product is a gateway into the E-Verify system, which many people think sucks (and they’re not entirely wrong, but not entirely right, either).

That said, we want to talk today about “The Gap.” This is the difference between the reported reality of the system and what we’re seeing on the ground, particularly when it comes to people not being able to get any of their information corrected if they get a tentative non-confirmation. This is cited in the IPC’s report, and it was cited over and over and over at last week’s Congressional hearings on E-Verify.

But the fact is that we haven’t seen it. Somewhere up above 90 percent of our clients’ tentative non-confirmations get resolved within the eight Federal business days. The rest? About half go uncontested and the employee is never seen again that day. The remainder say they’re going to contest it, then never come back to work. Or work for a couple days then are never seen again.

We asked one of our biggest clients about this. They’re a good representative client: a multi-unit restaurant company that has a high hiring throughput (over 1,000 new hires a year) and tends to attract lower wage earners.

This was our exact question: “There’s a lot of talk about qualified people not being to stay on after tentative non-confirmations because they can’t get in to SSAs office to get their information changed. Have you seen that?”

The answer: “Not at all. Never. We see people who get tentative non-confirmations not coming back after the first day. Or we see people go and get it figured out.”

We asked another client of ours, a 100-200 employee company in the construction industry, if they were losing employees because of calendar issues after a tentative non-confirmation result.

The answer: “Never. Our tentative confirmations usually don’t contest, and they just walk out of the office. When they’ve challenged them and gotten them resolved they can usually do it in a long afternoon.”

So you’ve got “The Gap” between what’s being said and what’s actually happening out here.

The E-Verify debate is becoming the abortion debate of the employment-law world, and facts are getting lost in the shuffle.

Here’s a line from the IPC report:

Ken Nagel, a restaurant owner in Phoenix, recently hired one of his daughters—a native-born U.S. citizen—to work in his restaurant. When he put her information through E-Verify, he received a “tentative nonconfirmation,” meaning the system could not verify that she was authorized to work in the United States.4

The fact comes out of a March 3, 2008 story in The Arizona Republic. What’s never answered is why. My guess is that the daughter is married and used a different last name in the E-Verify input than was listed in the SSA database.

Probably 50 percent of our tentative non-confirmations are because of last name misalignments.

An appearance in The Arizona Republic

An article by Craig Harris of The Arizona Republic that quoted us a couple times.

A good article, with an interesting point by Julie Pace, a Phoenix employment attorney who fought E-Verify on behalf of the business community and now appears to be not such a fan of designated agents such as ourselves.

She makes the point that DHS has promulgated, in practice, two sets of regulations. One for DA’s and one for those who contract directly with E-Verify. Those who contract with DHS have to use the PhotoTool, she says, and those who don’t aren’t required to keep photocopies of I-551 applicants.

She’s only half right. Designated agents don’t have the PhotoTool available to them at this time, so if you sign up with a designated agent, you won’t have access to the tool, which brings up the I-551 or I-776 document image in the DHS system.

But here’s a lesson to the eight of you that read this blog: Just because you’re signed up with a designated agent doesn’t mean that regulatory requirements are lifted. Go to the higher standard to make the good faith argument when you get audited.

We’ll write about DHS’ efforts to negotiate with state motor-vehicle departments to get driver’s license photos of all licensed drivers to add into the PhotoTool tomorrow.

Bloody E-Verify debate looms

May 6 is upon us. The day that there’s a huge E-Verify hearing on Capitol Hill. And the day that E-Verify proponents (there are few) will face off against the Society of Human Resource Managers and other groups that support Texas Sen. Sam Johnson’s employment verification bill.

There’s a fine entry in Workforce Washington about it. Best line in the piece:

So, in typical Washington fashion, the DHS decides to inoculate against such criticism by unveiling two enhancements to the system the day before a Tuesday, May 6, House Ways & Means subcommittee hearing on employer verification.

The two major changes:

1. Naturalization data will be added into the master E-Verify database (which now is comprised of DHS and Social Security Administration data).

2. Non-confirmed workers will be able to go to USCIS to resolve their issues rather than working through SSA.

From an operational standpoint, these are two good improvements. Naturalization data should tighten E-Verify’s error rate. And shifting some of the fix burden away from SSA is always a good thing.

Watch the May 6 debate for foreshadows: Congress has to extend the law that authorizes E-Verify in November.

Critical mass builds as sine die approaches

So here we are, with legislative sessions winding up. The National Conference of State Legislators released a report last week that pretty much stated that immigration laws are the new black: more than 1,100 bills have been considered in 44 states.

Most of them fail. So far, 26 state have enacted 44 laws on the issue, according to the report. This includes Mississippi’s Employment Protection Act.

But as we get closer to sine die, the final week of the various bodies legislative, we’re beginning to see things heat up. In Arizona, the state Senate has passed a bill that gives the business community a little more control over the Legal Arizona Workers Act last year (and, if passed and signed by the governor, would head off a harder-line citizens’ initiative). In Rhode Island, a mandatory E-Verify bill had its vote pushed back to next week (last month, the governor signed a resolution that all state agencies and private companies doing business with the state had to use E-Verify; Utah passed a similar law earlier this spring).  And in South Carolina, a bruising legislative battle over use of E-Verify is coming to a head.

None of this is surprising, of course.  The NCSL counts 179 of the 1,106 immigration-related bills as dealing with the topic of “employment.”

As critical mass builds, it will be interesting to watch which direction the energy moves. The Arizona bill passed last year and being revised this year was unfriendly to employers but didn’t really penalize illegal workers. The Mississippi law is somewhat unfriendly to employers and would throw illegal workers in prison for up to five years.  The question on our minds is this: Will the energy in these bills go towards penalizing the employers, or penalizing the employees?

Back from Mississippi

So, we’re back from the SHRM conference in Hattiesburg. We’ll spare the “good time was had by all” commentary, though it was a nice time.

Here’s some random E-Verify/EEV things we picked up.

1. While conservative talk radio tends to be talk about this more than mainstream people, this was a topic mentioned by every caller to the various local call-in shows about politics.  As we’ve seen other places, the people talking about it in Mississippi tend to focus more on the illegal worker than the company that hires them illegally. The EPA, with its 1-5 years in prison for being an illegal immigrant, is reflective of this.

2. Lt. Gov. Phil Bryant was on one of the call-in shows. We don’t claim to be experts in Mississippi politics, but we found it interesting that Bryant said he doesn’t think the law needs any modifications, while the governor, Haley Barbour, signed the bill into law with reservations and hoped the state legislature would make some revisions.  We think this will ultimately result in stalemate, at least until the business groups get their act together and start pushing. It also looks like a special session of the Ledge will deal with healthcare, rather than this bill.

3. No one has any idea what’s going to happen. In separate conversations with attorneys, SSA employees and private employers, no one has yet put together a roadmap. This isn’t entirely surprising, given the law’s recent advent and the fact that the first stage of implementation doesn’t hit for eight more weeks.

4. The most common questions about the experience in Arizona were:

1. How long does it take to resolve a tentative non-confirmation? (Answer: The hire gets 10 federal days, but our clients are seeing an average resolution time of 5 five days)

2. Are employers using it to go back and check current hires? (The DHS-employer MOU specifically forbids this, with the punishment being that an employer won’t be allowed to use E-Verify)

3. Has anyone been prosecuted in Arizona? (Not yet. The Arizona Republic has a nice story here about that).

Heading to Hattiesburg

We’ll be at the Mississippi Society of Human Resource Managers state conference in Hattiesburg Wed. – Fri.

If you’re there, stop by, have some caramel corn and watch us demonstrate how painless E-Verify can be when you have an interface that’s fast, easy and actually lets you manage the process.

We don’t have a booth number yet, but we’ll post it when we get there.

The coming collision between the Feds and the several states

On April 17, Pilgrim’s Pride Corp., one of the biggest chicken processors in the country, had its facilities raided by Immigration and Customs Enforcement. Despite voluntarily using E-Verify, some 4 percent of the company’s workforce at its processing plants in Arkansas, Florida, West Virginia and Texas was found to have committed identity fraud.

There’s a well thought-out blog entry at Immigration Insider that deals with the Pilgrim’s Pride raid being another example of how good-faith compliance with government regulations doesn’t mean squat to the federal government.

We feel there’s another problem: State laws — the Mississippi law among them — that state they provide “safe harbor” to companies using E-Verify can lull businesses into a false sense of security.  Because here’sa quote from the head of ICE’s Dallas office: “We’ll go wherever the evidence leads us … We’re still here. This is not the end.”

The Pilgrim’s Pride incident foreshadows a coming collision between federal laws and rules and the laws that are emerging out of the several states.

Both Arizona and Mississippi guarantee that employers who use E-Verify to hire employers — as is mandated under the Arizona Legal Workers Act and the Mississippi Employment Protection Act — are granted “safe harbor” when it comes to enforcement of the state law. Use of E-Verify = rebuttable presumption.

But despite this fact, and despite the fact that the standard memorandum of understanding between the Department of Homeland Security and any E-Verify user also grants users a rebuttable presumption, the federal government continues to crack down.

ICE did it last year with Swift and this year with Pilgrim’s Pride.

Our worry is that using E-Verify is going to lull employers into a false sense of security. After all, it creates a rebuttable presumption, right? And you can believe that right up to the time the ICE guys arrest 4 percent of your workforce.

Calcification of the labor market

California legislators have introduced employer-sanction bills in the Legislature there. Florida has an E-Verify-for-all-government-agencies bill moving through its legislature.

Has anyone wondered about the downstream effect of all this? Besides the employers.

I’m aching to see a study about what  happens in the labor market after employment-verification laws are put in. Perhaps it’s too new to do a study (and the only state with a 100 percent requirement is Arizona), but from what our clients are telling us, the labor market is getting swampy.

Or more like calcified. We surveyed our Arizona clients last week about this — an estimated 12 percent of the workforce there is illegal — and here’s the results:

The new law makes it harder to hire qualified workers: 80 percent strongly agree

The labor market has gotten smaller since the new law passed: 65 percent strongly agree, 10 percent agree

(but in the categories of construction and hospitality, it’s 100 percent strongly agree).

The downstream effect, from our study, at least, is that the tighter labor supply due to E-Verify  is doing two things: 1) Illegal employees that were employed before Jan. 1, 2008 are staying put; and 2) wages are going up.

We had a conversation with a restaurant owner the other day who said that job he’d usually pay presumptive illegals $5-$7 for he’s now having to pay out $8-$9 for. He calls it “The Price of Legality.”