Five years ago when Hazleton adopted an immigration law requiring businesses to screen workers, challengers to the law said the system “was not ready for prime time.”

Now the time is near as demands increase on the system, known as E-Verify.

On May 26, the U.S. Supreme Court upheld a law that required employers to use E-Verify to check the status of their workers in Arizona.

Arizona is among 14 states that compel at least some employers to use E-Verify.

In view of the decision in the Arizona case, the Supreme Court on Monday told a lower court to reconsider a ruling that Hazleton’s law is unconstitutional.

“In that context, it provides a green light to states that were trying to issue these types of laws,” said Muzaffar Chishti, an attorney and director of the Migration Policy Institute’s office at the New York University School of Law.

Pennsylvania’s Senate on May 24 approved a bill that required state contractors and sub-contractors to use E-Verify.

Sen. David Argall, R-29, said people frequently bring up immigration at town meetings, and he voted for the bill, as well as a bill requiring residents to show identification before receiving welfare and health-care benefits.

“I think it is very appropriate that we ask employers to do everything possible to determine if they are hiring legal workers,” Argall said.

State Rep. Tarah Toohil, R-116, said she will support the bill in the House of Representatives.

“Where the federal government has failed us, it is the duty of the state and local governments to enforce such laws,” Toohil said in an email.

In Congress, four bills introduced during the previous session proposed implementing E-Verify nationwide.

U.S. Rep. Lou Barletta, R-11, who led the effort to enact Hazleton’s law while he was the city’s mayor, co-sponsors a colleague’s bill to make E-Verify a national, mandatory program. He also backs a bill to use E-Verify to establish programs that might lead to the discovery of illegal immigrants.

“With so many workers out of work, it’s important to ensure we’re hiring legal workers, and E-Verify would be the way to do that,” Barletta said.

The accuracy of E-Verify’s improved, but the system still produces false results, Marc Rosenblum writes in “E-Verify: Strengths, Weaknesses and Proposals for Reform.”

Rosenblum, who testified about the verification program during the trial challenging Hazleton’s law, wrote the report in February for the Migration Policy Institute. He now works for the Congressional Research Service.

“Giving employers greater certainty about whether an employee is authorized to work in the United States is the only fair way to hold them accountable for having a legal workforce, and ultimately, to lessen the jobs magnet that attracts most illegal immigrants,” Rosenblum wrote.

Of the unauthorized workers screened by E-Verify from April to June 2009, 54 percent were incorrectly confirmed as legal workers, the Westat Corp. estimated in a study done for the U.S. Department of Homeland Security.

E-Verify, for example, can’t detect workers who present stolen or borrowed documents to verify their immigration status. Mississippi is trying a pilot program that uses photos to detect fraud with E-Verify.

Conversely, in about 0.8 percent of queries from April to June in 2008, E-Verify falsely labeled legal workers as tentatively noncompliant, according to a statistical model that Westat used.

Although E-Verify has improved from error results as high as 12 percent for tentative noncompliance, any false reading can keep workers from gaining jobs and cost employers time and money.

In 95 percent of queries, a worker’s status is confirmed immediately through E-Verify. Resolving the status of workers marked tentatively noncompliant, however, takes seven to 12 days, Rosenblum writes.

Although employers are supposed to screen workers after they hire them and provide an opportunity for workers to correct errors, some applicants are passed over and workers fired without ever being told the E-Verify labeled them as noncompliant.

Of those who are told, 22 percent said they spent $50 to correct the errors.

As the use of E-Verify expands, so will the number of workers affected by mistakes and the cost to taxpayers. The Congressional Budget Office estimated implementing E-Verify nationwide for fiscal years 2008 to 2012 would have cost $3 billion. Running E-Verify for fewer employers now costs about $100 million a year, Rosenblum wrote.

He also described a misunderstanding about the role of E-Verify.

The system, he said “can’t force employers to hire legal workers, it can only give employers a better tool to distinguish between legal and unauthorized workers.”

Rosenblam also favors linking the use of E-Verify with a program to legalize workers, an approach that he said would encourage workers and employers to follow the rules and avoid the underground economy.

Chishti, of the Migration Policy Institute’s branch at NYU School of Law, thinks all businesses eventually will be required to use E-Verify. He recommends a phase-in, starting with large employers or with employers in industries crucial to national security.

“See what the issues are, correct them and then move to the next stage,” Chishti said

And, in Colorado, the annual round-up of illegal farm workers has begun.

Says BusinessWeek:

The agriculture industry fears a disaster is on the horizon if the one bit of new immigration policy that Congress seems to agree on becomes law.

It’s a plan to require that all American businesses run their employees through a program that confirms each worker is legally entitled to work in the U.S.

The program, known as E-Verify, could wreak havoc on an industry where 80 percent of the field workers are illegal immigrants. So could the increased paperwork audits already under way by the Obama administration.

The BusinessWeek story was excerpted from a much more in-depth Associated Press piece, which says farm businesses in the United States need to be able to hire lots of people on short notice and for short-term work that is both skilled and difficult.

“Few citizens express interest, in large part because this is hard, tough work,” Agriculture Secretary Tom Vilsak said this past week. “Our broken immigration system offers little hope for producers to do the right thing.”

Arturo S. Rodriguez, president of United Farm Workers, said migrant farm workers are exposed to blistering heat with little or no shade and few water breaks. It’s skilled work, he said, requiring produce pickers to be exact and quick. While the best mushroom pickers can earn about $35,000 to $40,000 a year for piece work, there’s little chance for a good living and American workers don’t seem interested in farm jobs.

…

Manuel Cunha, president of Nisei Farmers League, a group representing growers in central California, said farmers don’t have the wherewithal to verify a worker’s status when their labor force is often hired on the spot and in a hurry to pick ripe crops. Forcing them to verify a worker’s legal status, he said, would prove disastrous.

“If we were to use E-Verify now, we’d shut down, either that or farmers would go to prison,” said Cunha, a Fresno-based citrus farmer. “We’ve admitted many workers are not legal and if you have to get rid of everybody, where do I go to get my labor? Nowhere. We have to have a work force that we can put in the system.”

Last year, the AP reports, the UFW conducted a campaign to interest Americans in seasonal agricultural work. They received more than 86,000 inquiries but only 11 American citizens ended up accepting employment.

Many employers are unaware of the risks of I-9 errors, but the issue is emerging as more businesses find themselves subject to I-9 audits by Immigration and Customs Enforcement, or ICE, the police division of the Department of Homeland Security. With the federal government cracking down on noncompliant businesses, employers need to take immediate steps to get their I-9s in order or risk criminal and civil penalties.

The federal government has had the ability to audit employers since the act passed in 1986, though they rarely conducted audits until recently. However, beginning in 2009, ICE issued a memorandum directing its agents to begin targeting employers for failing to properly fill out the I-9.

Unfortunately for employers, this change occurred with almost no public notice, and ICE has begun to levy hefty fines and penalties against employers for even minor I-9 errors.

In 2010, ICE audited more than 2,600 companies and is well on its way to surpassing that number this year. The federal government sees I-9 audits as the linchpin to curbing illegal immigration. The rationale is that if it becomes too risky for an employer to take the chance of hiring an illegal immigrant, available jobs will fall in number and the incentive to come here illegally will also decrease.

ICE estimates that more than 99 percent of employers have errors on their I-9s, and the average I-9 has five errors. The rules are confusing because the Citizenship and Immigration Services issues the official regulations on the I-9 but a separate agency, ICE, enforces the regulations and issues its own unofficial regulations, which often contradict the official USCIS guidelines.

Employers are often left guessing about how to ensure I-9 compliance until ICE shows up for an inspection.

ICE will enforce criminal penalties against those running the company, along with civil penalties levied against the individuals and the company for failing to properly comply. Within the last year, several managers, CEOs and presidents have been sentenced to prison for hiring undocumented workers. One CEO got 27 years behind bars.

Additionally, ICE has levied heavy civil fines and sanctions against employers ranging from several thousand dollars to multimillion-dollar fines. ICE has also enforced civil fines against individuals, which in some cases exceeds $250,000 per person. Moreover, ICE has begun to bring discrimination lawsuits against employers who “over-document” their foreign-born legal employees.

Obviously, I-9 noncompliance is a corporate land mine that every company should be aware of.

In order to protect your business and yourself, there are a few things every employer should do.

First, every employer should have their I-9s audited by a corporate immigration attorney to assess any errors that have occurred, many of which are correctable.

After an attorney performs the company’s self-audit, human resources personnel should be trained on how to comply with I-9 procedures, and the company should adopt an I-9 compliance policy. The compliance policy should emulate ICE Best Practices, which are the guidelines ICE suggests each employer should adopt.

Once those steps are finished, the employer should have an annual compliance audit performed for any new employees hired since the prior audit.

If an employer follows these steps, the risks of noncompliance will be greatly decreased, and individuals and the business are protected.

On Thursday, the U.S. Supreme Court upheld an Arizona law that permits local officials to revoke the licenses of businesses that knowingly hire illegal workers. The decision makes sense in principle but not in practice.

Under the 2007 Legal Arizona Workers Act, business owners are required to use the federal E-Verify program to confirm if a person is authorized to work in this country. Employers must electronically check workers’ names against databases kept by the Social Security Administration and the Department of Homeland Security. Workers found to be ineligible have up to eight working days to straighten out the problem before employers would be required to fire them. If a company is found to have knowingly hired an undocumented worker once, it can have its licenses suspended; twice, the company may be shut down.

The problem with the Arizona statute is not that it penalizes employers who break the law. Businesses that hire undocumented immigrants should face fines or sanctions, as called for under current federal law (although many would disagree with the court’s conclusion that states may impose such penalties). The problem is that the law relies on E-Verify, which isn’t ready for prime time.

Until now, E-Verify has generally been used on a voluntary basis by employers because of concerns about its accuracy. Conservative estimates put the program’s error rate at just under 1 percent — meaning that one out of every 100 legal job applicants could be found ineligible to work. Nearly half of those will not be able to fix the problem even though they are citizens or legal workers, according to the National Immigration Law Center. The reality is that the error rate may be much higher. Consider that in 2008, Intel Corp. reported that just over 12 percent of its workers were wrongly tagged as ineligible, according to the Migration Policy Center in Washington. Or that a survey by Los Angeles County of employees found an error rate of 2.7 in 2008 and 2.0 in 2009, according to a report submitted to the Board of Supervisors. The error rate is especially high in cities with large immigrant communities.

Furthermore, E-Verify doesn’t detect identity theft or prevent unscrupulous employers from moving their workforce off the books. Nor does the law guarantee employers that they will be immune from losing their licenses if E-Verify mistakenly allows them to hire an undocumented worker. That lack of protection may, as Justice Stephen G. Breyer noted in his dissent, persuade some business owners to avoid hiring those who look or sound foreign-born.

At the very least, the court’s ruling should prompt the Obama administration to act quickly to fix E-Verify and improve its accuracy. And the White House should seek a qualified candidate to serve as the Justice Department’s special counsel in charge of enforcing the anti-discrimination provisions of the immigration law.

But the court’s ruling doesn’t fix the bigger problem: the need for comprehensive immigration reform.

Arizona and other states that have passed similar measures are stumbling to create their own immigration laws because the current system isn’t working. Thursday’s decision should put Washington on notice that in the absence of a federal solution, states will step in to fill the void.

The USCIS also revised the list of acceptable documents and eliminated outdated documents. For example, Temporary Resident Cards (I 688) and Forms I-688A and I-688B have been removed, because the USCIS no longer issues such cards and any such document would have expired by the effective date of the final rule. Documents applicable to certain citizens of the Federated States of Micronesia and the Republic of the Marshall Island are now acceptable.

Attorney for Fiesta Foods Julie Pace said, ”the companies are victims too and people can pass the I-9 process which is a mandatory process in the country, and still be using counterfeit documents that people don’t know about.”

Some of the employees left when they were notified, some were laid off, and some are fighting the claim. The company’s lawyers should not be fined or penalized because they didn’t knowingly hire illegal immigrants. She says it voluntarily uses E-verify to check employees citizenship status.

Pace said, “it’s not foolproof, government statistics are that 50 percent of people who are undocumented to work still pass E-verify.”

Many of the fiesta foods customers KAPP/KVEW talked with said the employment audit is not going to steer them away from the store, but many of them had very different views on immigration reform itself.

Pioquinto Garcia said, ”why not help them out, try to get them a license to work here or permit, try and get them their papers.”

Bonnie Leppert said, ”if it was me, and I had come into the U.S. and I had done everything legally and them I see that it’s not being upheld or it’s not being enforced it would make me upset.”

The ICE spokeswoman says the department has increased random I-9 audits like this after President Obama took office. She says there have been 3,500 audits like this under his administration. As for the employees who left, the company attorney says they cannot be hired back, and they will be pointed in the right direction for obtaining legal citizenship.

Robert Luskin, an outside counsel for Chipotle, confirmed that U.S. Immigration and Customs Enforcement officials visited “20 to 25 restaurants” as part of a criminal investigation of the company. Mr. Luskin, a partner at Patton Boggs LLP in Washington, D.C., said the government had notified the company that its agents would seek to interview workers.

“The company remains fully committed to cooperating with the government’s investigation,” said Mr. Luskin.

The agents, who arrived in plain clothes, interviewed managers and supervisors, according to people familiar with the investigation. The restaurants visited by agents were located in Atlanta, Washington, D.C., and Los Angeles, among other cities, these people said.

“As a matter of policy, ICE does not comment on ongoing investigations,” said Cori W. Bassett, an agency spokeswoman.

ICE has been investigating Chipotle for several months. The burrito chain has seen galloping growth in recent years.

Chipotle let go of more than 400 workers in Minnesota last December, following an ICE audit of company records, namely I-9 forms that attest to a worker’s eligibility to be employed in the U.S. The audit indicated workers had used suspect documents to secure jobs.

“If agents are interviewing workers at stores, clearly they are looking for information that goes beyond the I-9 audits,” said Victor Cerba, a former general counsel at ICE who is now a partner at Jackson Lewis LLP. “An audit can be a purely paper process when there is nothing unusual with the company.”

In March, Chipotle fired at least 40 workers in Washington, D.C., after ICE collected documents for an audit in Virginia and Washington, according to an immigrant advocacy group and dismissed workers. A Chipotle spokesman said they had presented new documents to verify their status “that proved to be fraudulent.”

Last month, Chipotle disclosed that the criminal division of the U.S. attorney’s office in Washington had joined the case. “That elevated the case to the highest level of scrutiny under immigration law,” said Mr. Cerba, who advises firms facing audits.

The Obama administration in 2009 shifted the focus of workplace enforcement from arresting illegal workers to pressuring employers not to hire illegal workers. The approach includes expanded use of civil penalties and criminal prosecutions. Businesses face criminal charges if authorities can prove the employers knowingly employed unauthorized workers.

In the fiscal year that ended Sept. 30, 2010, ICE filed criminal charges against a record 180 owners, managers and other senior officials of companies. It initiated a record 2,746 work-site enforcement cases in fiscal 2010.

More than 1,000 audits are under way, according to ICE. But the investigation of Chipotle, a high-profile chain whose slogan is “Food with Integrity,” has garnered the most attention.

Chipotle boasts 1,100 company -owned and-operated restaurants across the U.S. Its share price has more than tripled in the past two years. Recently, the company announced that it plans to open an Asian-themed restaurant chain in the summer that would echo Chipotle’s concept and business model.

But the immigration probe has cast a pall over the Wall Street favorite, with some analysts downgrading its share value. The company’s labor costs are likely to rise as it hires new workers who require training to replace undocumented workers.

Job site Careerbuilder.com Tuesday had more than 100 postings for Chipotle hourly “team workers,” for restaurants from Florida and Connecticut to Nebraska and Arizona. Many of them had been posted in the past few days.

The Department of Justice, Office of the Chief Administrative Hearing Officer (OCAHO) has published a precedent decision regarding an employer’s liability for Form I-9 violations and the proper weight of various factors used to assess the amount of civil fines. The case, United States of America v. Snack Attack Deli, Inc. d/b/a Subway Restaurant #3718, tells the familiar story of a small restaurant in North Carolina that had neglected its employment eligibility verification responsibilities for several years and failed to complete I-9s for its employees. Faced with a potentially crippling fine of $111,078 for 108 distinct I-9 violations, the restaurant requested a hearing with OCAHO to dispute both its liability and the assessed fines. In ruling on the government’s motion for summary judgment, the Administrative Law Judge, Ellen Thomas, agreed with Immigration and Customs Enforcement (ICE) that the violations were serious and that the employer lacked good faith (as defined in more detail below). On balance though, the Judge considered the company’s small size and the general state of the economy to be more important considerations that weighed in favor of a reduced penalty.

This small business owner still had to pay $27,000 in fines.  Legal Employer works with many franchisees and small business owners around the country to ensure that their I-9 documentation is current and complies with all Federal regulations.  They have helped their clients avoid costly fines and embarrassing PR and most importantly – many hours of down time due to I-9 files that are either non-existent or out of compliance.  Contact them today for a free consultation and see how they can assist you – 1-866-726-9620.