Using "Illegal" Subcontractors Makes You a Target for Prosecution

Using "Illegal" Subcontractors Makes You a Target for Prosecution
Of all the employment issues we advise our clients on, the
subject of proper hiring practices is becoming more and
more critical. Just the other day in Des Moines, Iowa, 390
people were arrested for immigration violations at a
meatpacking plant. According to ICE (US Immigration and
Customs Enforcement) this was the largest workplace raid in
US history. The Associated Press reports that the raid was
aimed at seeking evidence of identity theft, stolen Social
Security numbers, and people who are in the country
illegally.

While the politicians wrestle with what to do about illegal
immigrants, Homeland Security has announced a
"comprehensive immigration enforcement strategy for the
nation's interior." In 2007 alone ICE "dramatically
increased penalties against employers whose hiring
processes violate the law, securing fines and judgments of
more than $30 million while making 863 criminal arrests and
4,077 administrative arrests." According to Julie Myers,
head of ICE, "ICE has no tolerance for corporate officers
who harbor illegal aliens for their work force."

OK. I can hear you saying, "I don't hire illegal aliens!
So why should this matter to me or my company?" While it
is obvious that hiring employees who are in the country
illegally is a crime, you may not know that using illegal
subcontractors can also subject you to the same punishment.

YOU BETTER KNOW WHO YOUR SUBCONTRACTORS ARE!

As you may know, Walmart was just was recently fined $11
million dollars for using subcontractors that had hired
illegals. Why? Because it is alleged that a few Walmart
managers knew that some of the subs were not here legally.
If someone in your company's management knowingly hires a
subcontractor who uses illegals, your company will be
subject to civil penalties. Furthermore, you will probably
end up getting really bad press!

CAN YOU SAY RACIAL PROFILING?

Because law enforcement hates to be accused of racial
profiling, I can almost guarantee that at some point, a few
businesses who have never hired anyone outside of a 5 mile
radius will still be investigated. How will they
investigate? Almost certainly someone will be sent to your
company to peruse your I-9 forms. Because an employee must
place his social security number on an I-9 form, examining
these forms allows ICE to see if any of your employees are
using a false social security number. A smoking gun.

CHECK YOUR EMPLOYMENT FILES - NOW!

Current law requires that all employees correctly and fully
complete an I-9 form upon being hired. Not retaining forms
or not having forms completed correctly can subject your
business to fines. If you've ever needed some
"encouragement" to double check your files, NOW IS THE TIME
TO GET YOUR RECORDS IN ORDER.

BUT I DON'T COLLECT I-9 FORMS FROM MY SUBCONTRACTORS

Most companies don't because they're not required to.
However, in light of the Walmart case, best practices may
dictate that you start. If ICE ever does investigate your
company, you can show that not only do you not hire illegal
aliens; you go the extra mile to make sure your subs are
not illegal either.

As the stepped up law enforcement surrounding this issue
shows, it's not going to go away any time soon. Therefore,
our duty as risk managers and insurance agents is to keep
our clients informed about these types of developments so
we can help protect them from all of the risks they face.

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Eric D. Patrick, is an attorney and Chief Operating Officer
of Consumers Insurance Agency Inc.
http://www.consumers-insurance.com . He also engages in
insurance consulting and legal work through The RiskAssure
Consulting Group. Please contact him for further
information.