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.”

Story from the trenches: When state laws slam into federal rules

This dispatch from the mean streets of Phoenix:

One of our clients hired a woman and, complying with Legal Arizona Workers law and the E-Verify rules, ran her through the database within three days of hire.

She had recently gotten married and used her married name in the application. But she hadn’t changed her information with the Social Security Administration. Not surprisingly, E-Verify returned a tentative non-confirmation. Our system provided the forms needed and she headed over to the local SSA office.

They changed her information in the system. Told her they’d send her a new SSN. And told her it was OK in 24 hours to resubmit her case.

The business did. And she came up with another tentative non-confirmation. A call to the SSA. “No, you’re in the system. Give it a day or so.”

Two days later, another submission attempt. Another tentative non-confirmation. Federal rules state that she can’t be fired during the allowed 10-day resolution period. But now those 10 days are up, and despite SSA assurances, she’s termed out. If the company keeps her on, they’ve essentially committed the same sin in the State of Arizona’s eyes as if they knowingly hired an illegal employee and kept them on despite the non-resolution of a tentative non-confirmation.

This is what happens when the state law — a non-positive in E-Verify equals a presumptive illegal worker or a hell of a lot of paperwork explaining why the worker’s legal — crashes into both federal rules and bureaucracy.

The final resolution: We called the E-Verify folks and found that the system hadn’t released the initial report. So we killed out the report, the company re-ran the employee, she came back “SSA employment authorized” and she’s working again.

Arizona statistics and what they mean

We’re big Mark Twain fans, and when he says there are “Lies, damn lies and statistics,” we tend to agree.

But here’s the cold hard facts about how the first quarter returns came out for our clients:

Percentage of forms run resulting in “tentative non-confirmation” returns: 8

Percentage of “tentative non-confirmation” returns that were uncontested: 9 percent

Percentage of “tentative non-confirmation” returns that were contested and resolved positively: 94 percent

So what does it mean?

The most salient stat is the 94 percent positive resolution rate on tentative non-confirmations. It tells us that the E-Verify database still has its error problems (roughly an 8 percent error rate, based on USCIS data released in December 2007; full evaluation is here) but is doing its job pretty well.

You’re looking at a 425 million record database, and with that error rate, you’re looking at 34 million mistakes. The most common error flags that we see is name mismatch, which seems to be centered on the middle name. For instance, “Mary Elaine Smith” is listed on the Social Security Card and “Mary Smith” was entered into the E-Verify database. The result was a tentative non-confirmation.

We terminated the query and re-entered the exact same information but included the middle name and got an “SSA Employment Authorized” back. Go figure.