[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]
S. Hrg. 102-000
IMMIGRANT EMPLOYMENT VERIFICATION AND SMALL BUSINESS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON WORKFORCE, EMPOWERMENT & GOVERNMENT PROGRAMS
of the
COMMITTEE ON SMALL BUSINESS
HOUSE OF REPRESENTATIVES
ONE HUNDRED NINTH CONGRESS
SECOND SESSION
__________
WASHINGTON, DC, JUNE 27, 2006
__________
Serial No. 109-58
__________
Printed for the use of the Committee on Small Business
Available via the World Wide Web: http://www.access.gpo.gov/congress/
house
_____
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COMMITTEE ON SMALL BUSINESS
DONALD A. MANZULLO, Illinois, Chairman
ROSCOE BARTLETT, Maryland, Vice NYDIA VELAZQUEZ, New York
Chairman JUANITA MILLENDER-McDONALD,
SUE KELLY, New York California
STEVE CHABOT, Ohio TOM UDALL, New Mexico
SAM GRAVES, Missouri DANIEL LIPINSKI, Illinois
TODD AKIN, Missouri ENI FALEOMAVAEGA, American Samoa
BILL SHUSTER, Pennsylvania DONNA CHRISTENSEN, Virgin Islands
MARILYN MUSGRAVE, Colorado DANNY DAVIS, Illinois
JEB BRADLEY, New Hampshire ED CASE, Hawaii
STEVE KING, Iowa MADELEINE BORDALLO, Guam
THADDEUS McCOTTER, Michigan RAUL GRIJALVA, Arizona
RIC KELLER, Florida MICHAEL MICHAUD, Maine
TED POE, Texas LINDA SANCHEZ, California
MICHAEL SODREL, Indiana JOHN BARROW, Georgia
JEFF FORTENBERRY, Nebraska MELISSA BEAN, Illinois
MICHAEL FITZPATRICK, Pennsylvania GWEN MOORE, Wisconsin
LYNN WESTMORELAND, Georgia
LOUIE GOHMERT, Texas
J. Matthew Szymanski, Chief of Staff
Phil Eskeland, Deputy Chief of Staff/Policy Director
Michael Day, Minority Staff Director
SUBCOMMITTEE ON WORKFORCE, EMPOWERMENT AND GOVERNMENT PROGRAMS
MARILYN MUSGRAVE, Colorado Chairman DANIEL LIPINSKI, Illinois
ROSCOE BARTLETT, Maryland TOM UDALL, New Mexico
BILL SHUSTER, Pennsylvania DANNY DAVIS, Illinois
MICHAEL FITZPATRICK, Pennsylvania RAUL GRIJALVA, Arizona
LYNN WESTMORELAND, Georgia MELISSA BEAN, Illinois
THADDEUS McCOTTER, Michigan GWEN MOORE, Wisconsin
JEB BRADLEY, New Hampshire
Joe Hartz, Professional Staff
(ii)
C O N T E N T S
----------
Witnesses
Page
Calvert, The Honorable Ken (CA-44), Congressman, U.S. House of
Representatives................................................ 4
Divine, Mr. Robert, Acting Deputy Director, U.S. Citizenship and
Immigration Services, U.S. Department of Homeland Security..... 6
Shandley, Mr. Jack, Senior Vice President, Human Resources, Swift
& Company...................................................... 17
Amador, Mr. Angelo, Director for Immigration Policy, U.S. Chamber
of Commerce, Essential Worker Immigration Coalition............ 19
Krikorian, Mr. Mark, Executive Director, Center for Immigration
Studies........................................................ 22
Malara, Mr. Toby, Government Affairs Counsel, American Staffing
Association.................................................... 24
Lake, Mr. Monte, Partner, McGuiness, Norris & Williams, LLP...... 26
Appendix
Opening statements:
Musgrave, Hon. Marilyn....................................... 33
Velazquez, Hon. Nydia (Ex Officio)........................... 37
Prepared statements:
Calvert, The Honorable Ken (CA-44), Congressman, U.S. House
of Representatives......................................... 39
Divine, Mr. Robert, Acting Deputy Director, U.S. Citizenship
and Immigration Services, U.S. Department of Homeland
Security................................................... 42
Shandley, Mr. Jack, Senior Vice President, Human Resources,
Swift & Company............................................ 49
Amador, Mr. Angelo, Director for Immigration Policy, U.S.
Chamber of Commerce, Essential Worker Immigration Coalition 53
Krikorian, Mr. Mark, Executive Director, Center for
Immigration Studies........................................ 65
Malara, Mr. Toby, Government Affairs Counsel, American
Staffing Association....................................... 73
Lake, Mr. Monte, Partner, McGuiness, Norris & Williams, LLP.. 80
(iii)
IMMIGRANT EMPLOYMENT VERIFICATION AND SMALL BUSINESS
----------
TUESDAY, JUNE 27, 2006
House of Representatives
Subcommittee on Workforce, Empowerment and
Government Programs
Committee on Small Business
Washington, DC
The Subcommittee met, pursuant to call, at 2:30 p.m., in
Room 2360 Rayburn House Office Building, Hon. Marilyn Musgrave
[Chairman of the Subcommittee] presiding.
Present: Representatives Musgrave, Lipinski, Udall, Davis.
Also Present: Representative Akin.
Chairman Musgrave. I think I will go ahead and call the
meeting to order, out of respect to Congressman Calvert's time,
and the witnesses. Mr. Lipinski is on his way, so he will join
us shortly.
I call this meeting to order. I thank you all for being
here, especially those of you that have traveled great
distances to provide the Committee with testimony.
While I've been traveling around my district, and I hear
this from most Congressmen, the problem of illegal immigration
is constantly one of the top concerns. Individuals, community
leaders, law enforcement leaders, healthcare providers,
educators, all recognize the effects that illegal immigration
has on our country, and they talk to us about passing laws to
promote America's tradition of waffle immigration.
The increasing number of immigrants crossing our borders
illegally is a burden to our economy and a threat to our
national security. The official census data predicts there are
8.7 million individuals living here illegally. However, some
unofficial estimates predicted closer to 12 million. There are
also approximately 500,000 illegal aliens that enter the United
States every year.
Because this is a pressing issue, the House of
Representatives passed H.R. 4437, the Border Protection, Anti-
Terrorism and Illegal Immigration Control Act, prior to the
recess of Congress in December of `05. In May of 2006, the
Senate also passed a significant immigration reform bill,
S.2611, the Comprehensive Immigration Reform Act of 2006. Both
bills make numerous significant changes to our immigration law
and border security efforts.
H.R. 4437 also aims to crack down on alien smugglers and
the alien gang members who terrorize our communities. In the
addition, the bill would direct the Secretary of Homeland
Security to devise a plan to provide systematic surveillance
coverage, and within one year introduce a plan for border
security, including risk assessment of ports of entry. This
plan would include a description of border security roles of
federal, state, regional, local and tribal authorities in ways
to ensure such security efforts would not impede commerce.
The focus of the hearing today, however, will be on the
expansion of the Basic Pilot program for employee verification
that is contained in both bills. The Immigration Reform and
Control Act of 1986 made it unlawful for employers to knowingly
hire or employ aliens not eligible to work, and required
employers to check the identity and work eligibility documents
of new employees.
This Act was designed to end the ``job-magnet'' that draws
the vast majority of illegal aliens to the United States.
Unfortunately, the easy availability of counterfeit documents
has made a mockery of that legislation that was passed in 1986.
Fake documents are produced by the millions, and they can be
bought very cheaply.
Through the Illegal Immigration Reform and Immigrant
Responsibility Act of 1996, Congress responded to the
deficiencies of the 1986 Act by establishing three employment
eligibility verification pilot programs for volunteer employers
in selected areas. This is known as the Basic Pilot program.
Since November of 1997, the Social Security Administration
and the Systemic Alien Verification for Entitlements program
have been conducting the Basic Pilot program in the states of
California, Florida, Illinois, Nebraska, New York and Texas.
The program was made available to all employers in all states
starting in December of 2004. The Basic Pilot involves
verification checks of the SSA and the now Department of
Homeland Security databases of all newly-hired employees,
regardless of citizenship.
The Basic Pilot is currently a voluntary program, and is
free to employers who volunteer to participate. It is now used
by over 4,000 employers and at least 15,000 work sites
nationwide.
The recently passed House and Senate legislation both
change the name of the Basic Pilot program to the Employment
Eligibility Verification System, and would require all
businesses to use it when making new hires. The legislation
also increases fines for companies failing to comply with the
new law.
While the House bill prescribes lower penalties for small
and medium-sized businesses, the Senate bill does not, nor does
the Senate bill have an exemption or fines for a ``good faith
effort'' to comply.
Our purpose here today is not to compare and contrast the
merits of either bill. All too often when these gigantic
reform-minded pieces of legislation are formulated, small
businesses are just an after thought. While the House did take
small and medium-sized businesses into consideration when they
constructed the legislation, there are many questions we need
to ask to ensure that this bill, should it become law, will not
unjustly overburden America's small businesses.
We need to answer questions such as, will making
participation mandatory increase the paperwork burden for small
businesses? How accurate will it be, and how can we ensure the
number of false positives and negatives will be extremely
minimal? How long will it take to certify someone, and will the
Department of Homeland Security be ready for it if it happens,
and what do we need to do in Congress to make sure they are?
I'm eager to hear today's testimony, and I would like to
sincerely thank Representative Calvert from California for
coming to testify before the Committee today. I know you are
very busy, and when you need to leave we will appreciate your
time that you've spent with us today.
Now, I'd like to recognize the Ranking Member, Mr.
Lipinski, for an opening statement.
[Chairman Musgrave's opening statement may be found in the
appendix.]
Mr. Lipinski. Thank you, Madam Chairman.
There's no question that immigration is a serious issue for
Americans, it has a significant impact on our economy. It's
estimated there are at least 7.2 million people who are working
illegal in the U.S., which is about 5 percent of the U.S. labor
force.
While this has been an issue for quite some time, the House
recently passed a bill to address this problem. The bottom line
is this, our borders simply are not as secure as they should
be. More than 500,000 individuals enter our country illegally
every year. We need to know who is coming into our country, and
prevent unauthorized people from entering.
I believe strongly that if a nation does not control its
borders, it is not fully protected. Border security legislation
is absolutely necessary.
But, before I go any further, I want to make it clear that
I believe that most who come into our country illegally, and
are here working illegally, are in this country illegally, are
here to work and to make a better life for themselves and for
their families. But, although this is the case, this does not
mean that we can just ignore the situation. For the sake of our
national and economic security, we can't allow the current
situation to continue.
H.R. 4437, the Border Protection, Anti-Terrorism and
Illegal Immigration Control Act of 2006 attempts to address
immigration problems by enhancing border security, or requiring
employers to verify the employment eligibility of its workers.
It is a critical step, but it's important that we carefully
examine all proposals and try to mitigate any unintended
consequences for small businesses.
Under Title VII of H.R. 4437, a new employee verification
system will be created that will make sure that employees are
legal and have proper documentation to work in the United
States.
During roundtables that I have had with small business
owners in my district, there's one clear message that they keep
giving me regarding employee verification. It's this, whatever
you do, make sure that when I follow the law my competitors are
also following the law, so I can compete on a level playing
field.
This new system is designed to accomplish this goal, but as
we consider the impact of new regulations on our entrepreneurs,
we must remember that the cost of regulation compliance is
already 60 percent higher for small businesses than their big
business counterparts. We need to make sure that any new
regulations do not add an unnecessary burden for small
businesses. Some additional burden will, unfortunately, be
necessary. We need to do all we can to minimize it.
In addition, small business owners need to know and
understand what the rules are regarding their work force. If
small business owners are not provided with a full
understanding of the verification system, it can lead to
significant confusion. Well-intentioned entrepreneurs may
inadvertently fail to comply, resulting in fines and possibly
criminal liability. We must do all we can so that those who are
breaking the law know it, and know that they will be punished.
Small businesses are the most important engines of our
economy. We must always be extremely careful when establishing
new regulations. We also have responsibility to secure and
protect our borders, and make sure that Americans are given the
opportunity to work.
I look forward to hearing the testimony from our witnesses
today about how we can best meet all of these goals.
Thank you.
Chairman Musgrave. Thank you, Mr. Lipinski, and now we will
hear from our first panel, starting out with Congressman
Calvert, and then we'll hear from Robert Divine. Thank you.
STATEMENT OF THE HONORABLE KEN CALVERT (CA-44), U.S. HOUSE OF
REPRESENTATIVES
Mr. Calvert. Thank you, Chairman Musgrave, Ranking Member
Lipinski, and certainly Members of the Committee. Thank you for
inviting me to speak today on employment verification.
I'm very pleased that the Small Business Committee is
taking a look at this program, because I strongly believe that
businesses need to use the program in order to retain and
regain confidence in their work force.
Before coming to Congress, I was a small business
restaurant owner in California. Like all employers, I required
my employees to present documents authenticating their identify
and employment eligibility as far of the I-9 Immigration
policy. There's a form process that you are aware of.
Since I've never been an expert on documents, I had no way
of knowing whether the documents presented were authentic or
fraudulent, so when I was elected to Congress I wrote
legislation to create the Basic Pilot program with the
intention of giving employers a reliable tool to verify their
employees' eligibility to work.
In the 109th Congress, I introduced H.R. 19, which would
make the Basic Pilot program mandatory, and phase in over time
by the size of the employer. The bill became the backbone of
Title VII of H.R. 4437, and Title III of the Senate Bill,
S.2611.
For a decade, the Basic Pilot program has been tested,
improved and expanded. The program began as a telephone system,
then became a modem-based system, with software installed on
each user's computers. Today, the program is an internet-based,
and as easy to use as buying a book off amazon.com. I can
attest how easy the program is, since I'm one of the first
members of Congress to sign up and use the program in my
Congressional Office.
I appreciate the opportunity to clear up some
misconceptions about the program, and highlight several key
facts.
The Basic Pilot program, and its possible successor, the
Employment Eligibility Verification System, as outlined in both
the House and Senate passed versions of the Immigration Reform
bills, works to ensure a legal work force by verifying
information used in the I-9 form. This program does not target
people, but rather confirms the voracity of the information on
documents people present. It is important to remember that the
program does not discriminate against people, but instead gives
employers confidence that the work force is legal and free to
work.
It's been noted that the Basic Pilot cannot detect identity
theft, yet I believe it can if the new program is used
properly. Immigration Customs enforcements must be able to
monitor the program's data to look for suspicious patterns,
just as credit card companies can flag suspicious activity, the
Basic Pilot program can be used to detect possible identity
theft by flagging a name and a Social Security number that is
being used over, and over, and over again.
Concerns over identity theft have led many to conclude that
we need a national identification card. I disagree. By
monitoring the data and flagging suspicious activity, a
mandatory program can combat identity theft without a new ID
card. It is true that no program will ever be perfect, but the
concerns about identity theft and program or document fraud can
be adequately addressed through a thorough and thoughtful
mandatory system, as reflected in the House passed Immigration
Reform Bill.
Some of the individuals testifying today may question the
accuracy, ease of use, speed, or cost of the program, and may
ask whether the program can be expanded for all employers
quickly enough. According to the 2005 GAO Report, the U.S.
Citizenship and Immigration Services has reduced their data
entry backlog from nine months to approximately ten to 12 days,
significantly improving the speed and accuracy of the program.
Additional reports found that 98.5 percent of all queries
receive an immediate response, and the program is 98.6 percent
accurate.
Striving for 100 percent accuracy is necessary, but we
should not make the perfect the enemy of the good. The accuracy
rate is already very good, and it will improve as the system is
implemented. Inaccurate results indicate there is a discrepancy
between the information presented by the employees and the data
on record.
Notification of a discrepancy is an opportunity for the
employee to correct the record. Adequate time is mandated to
allow an employee to clear up discrepancies. No one is
dismissed because of an initial negative.
I might add here that all employees with mismatched data
will receive a chance to correct the record, because employers
cannot use the system to pre-screen employees. They can only
use the program after they hire a new employee, which is
another safeguard against discrimination. If an employee is
wrongfully terminated, currently existing remedies remain
available to them.
Think of this as a similar to use of a credit report, which
are vital to our financial system, yet may contain errors. We
do not demand 100 percent perfection in the credit report
system in order to find it useful, because we understand that
credit reports are viable tools and that errors can be
corrected.
The Basic Pilot program is a good tool, and the accuracy of
the information will continue to improve as individuals have a
chance to correct the record. The Basic Pilot program has
experienced incredible success since it was launched ten years
ago, and that success is even more incredible when you consider
that Congress has not appropriated funds specifically for the
Basic Pilot program, instead requiring the Department of
Homeland Security to use funds from its discretionary accounts.
Yet, the lack of funding is changing. For the first time,
the House appropriated $114 million for FY07 to expand and
improve the Basic Pilot program to ensure it is ready to handle
a huge spike in demand. There are right now about 10,000
employers using the program today, up from 2,300 in 2004, and
more employers are signing up each and every day.
Based on the program's superior performance at this point,
it is clear that the program will be adequately prepared to
quickly and accurately handle queries from every employer in
this Nation.
I believe the U.S. Government needs to better enforce their
immigration laws, including employer sanctions and work site
enforcement. If we are going to hold employers responsible for
following the law, we must give them a tool which they can use
in good faith. The Basic Pilot program is a tool that all
employers should use.
A vital component of immigration reform is to make sure
everyone who works in the United States is doing so legally, by
turning off the ``job-magnet.'' Making the Basic Pilot program
mandatory is an essential component of our national policy that
de-incentivizes illegal employment in the United States, and
without it all other efforts to enforce immigration laws, in my
opinion, will fall short.
Thank you for allowing me an opportunity to speak with you
today, and I'll be happy to answer any questions when the time
comes.
Chairman Musgrave. Congressman Calvert, would you be able
to answer questions after Mr. Divine speaks? Can you stay that
long?
Mr. Calvert. Sure.
Chairman Musgrave. Okay, thank you so much.
[Congressman Calvert's testimony may be found in the
appendix.]
Chairman Musgrave. Now we'll hear from Mr. Robert Divine,
Acting Deputy Director of U.S. Citizenship and Immigration
Services. Thank you for appearing before the Committee.
STATEMENT OF ROBERT DIVINE, U.S. CITIZENSHIP AND IMMIGRATION
SERVICES, U.S. DEPARTMENT OF HOMELAND SECURITY
Mr. Divine. Thank you, Madam Chairman.
Chairman, Ranking Member Lipinski, Members of the
Subcommittee, my name is Robert Divine. I'm Acting Deputy
Director of U.S. Citizenship and Immigration Services. I'm
honored to have this opportunity to talk with the Subcommittee
about the basic Employment Verification Pilot, which we call
the Basic Pilot, which confirms information for participating
employers concerning the work eligibility of their newly-hired
workers.
I'll also describe the agency's plans to improve and expand
the Basic Pilot, and to implement a nationwide mandatory
Employment Eligibility Verification System.
I appreciate your interest in the program, I appreciate
Congressman Calvert's involvement in creating it.
Chairman Musgrave. Could you move the mic just a little
closer, we are having a little bit of a hard time hearing.
Mr. Divine. There we go.
Chairman Musgrave. Okay, thank you.
Mr. Divine. Let me put it in my mouth and it will work.
And, we look forward to seeing the participation in the
program of every one of the Committee and Subcommittee's
Members' offices.
The Employment Verification System, as we conceive it, is a
critical step in improving work site enforcement, and it
directly supports the President's goal of achieving
comprehensive immigration reform.
In his speech to the U.S. Chamber on June 1, President Bush
endorse the Basic Pilot as a quick and practical way to verify
Social Security numbers that gives employers confidence that
their workers are legal, improve the accuracy of wage and tax
reporting, and helps ensure that those who obey our laws are
not under cut by illegal workers.
Today, an illegal immigrant with a fake ID and a Social
Security card can find work almost anywhere in the country
without difficulty. It is the prospect of jobs that leads
people to risk their lives, crossing hundreds of miles of
desert, or to spend years in the shadows, afraid to call the
authorities when victimized by criminals or exploited by their
boss. That is why the Administration has proposed a
comprehensive overhaul of the Employment Verification System
and Employers Sanctions Program as part of the President's call
for a comprehensive immigration reform.
Quick history, Congress established the Basic Pilot as part
of the IIRIRA law in 1996, creating a program for verifying
employment eligibility, at no charge to the employer, of both
U.S. citizens and noncitizens. The Basic Pilot program began in
1997 as a voluntary program for employers in the five states
with the largest immigrant populations, and in 1999, Nebraska
was added. It was twice extended, most recently in 2003, valid
and effective until 2008, and at that time it was also made
available to participating employers in all 50 states, not just
those five original. A small percentage of employers
participate, but the program is growing by about 200 employers
a month, as Congressman Calvert stated, about 9,300 Memorandums
of Agreement with employers who are verifying over a million
new hires per year at more than 34,000 work sites.
Madam Chairman, I understand you have said, that ``Small
businesses are the backbone of Colorado's economy,'' and, of
course, that's true for the Nation as well. Most of our
participating employers have 500 or fewer employees. In
Colorado, there are 207 participating employers, including the
U.S. Olympic Committee, Alsco Laundry Service and the New World
Restaurant Group, as examples. Ranking Member Lipinski, in
Illinois, there are 407 participating employers, including
Staffmark Employment Agency, Judson College, and St. Joseph's
Medical Center, and we welcome your support in reaching out to
enroll even more employers into the program.
Now, here's how the program works. After hiring a new
employee, an employer submits a query including the employee's
name, date of birth, Social Security account number (SSN) and
whether the person claims to be a U.S. citizen or a noncitizen,
and if a noncitizen they provide either the Alien number of
some other DHS number to give a tie in to a system about their
status. And, through the system the employer receives an
initial verification within seconds, electronically. The system
first electronically sends the information to the Social
Security Administration's Numident database, and if the new
hire claims to a citizen, then that's the end of it. It stops
with the Social Security Administration's confirmation in the
database.
If the new-hires SSN, name and date of birth to the Social
Security Administration (SSA) to match that data, and SSA will
confirm citizenship status (if the employee claimed to be a
U.S. citizen) based on data in the Social Security
Administration's Numident database. If the Social Security
database cannot immediately verify electronically, then that
system sends an SSA tentative non-confirmation to the employer,
and then the employer must notify the employee of the tentative
non-confirmation and give the employee an opportunity to
contest that filing, a very important part of the procedure as
the Congressman has mentioned.
In the case of a noncitizen, after the Social Security
Administration has--after its system has verified, and only if
it verifies, then the system will go forward to the DHA Basic
Pilot database, and seek to verify electronically. And, if the
system cannot electronically verify the status of the
noncitizen as lawfully able to work in the United States, then
an Immigration Status Verifier, a human being in U.S.
Citizenship and Immigration Services, will personally research
the case, usually providing a response within one business day,
I think in 90 percent of the cases that's the turnaround time,
either verifying work authorization or issuing a DHS tentative
non-confirmation. If the employer receives a tentative non-
confirmation, the employer must notify the employee of that
finding and give the employee an opportunity to contest that
finding.
When USCIS receives a response to that, USCIS normally
resolves the case within three business days, issuing either a
verification or a DHS final non-confirmation. So, whether it's
to the Social Security Administration initially or to USCIS for
a noncitizen who verified with Social Security if there is a
non-confirmation, if the system can't confirm then the employee
is given a chance to contest and cure the problem, and correct
the database.
As you know, the House and the Senate have both passed
significant immigration legislation this session, including an
agreement on the idea of a mandatory electronic Employment
Eligibility Verification Program for all 7 million U.S.
employers. Although the proposals differ in some significant
ways, both bills would require an expansion of the electronic
Employer Verification System Program that is, basically, an
expansion of the Basic Pilot to all employers.
Therefore, USCIS is already planning for the expansion of
the program, planning. The President's Fiscal Year `07 budget
requests $110 million to expand and improve the Basic Pilot, so
that it can be used for all employers, including components for
outreach, systems monitoring and compliance.
So, let me briefly outline what those improvements and
expansions that we are planning. First, ensuring that all
employment-authorized aliens have secure biometric cards with
an enumerator, and phasing out the production of locally-
produced cards that are too vulnerable to counterfeiting, and
that are not tied reliably to the verification system. The idea
is to reduce manual secondary checks, which slow down everybody
in the system and cost the system money and time.
Second, we are working on tapping into our card databases
for verification. That means, a worker who has a card, a
permanent resident card, or an employment card, would present
that card for verification and would be required to do so, and
when doing so would be--that card and its data would be
validated against the database from which the card was made. In
other words, it's a one-to-one match directly against the
information that it arose from, and it should be instantaneous.
That would again reduce the number of manual secondary checks.
The third thing is to add more DHS information about the
status of temporary workers in the Basic Pilot Verification
System. Right now, our system is not pointed to every--to a
real-time database about entries that has recently become
available, so we need to point to that system and get the
information.
We also need to include information about people who have
changed or extended their status within the United States, and
when we do that we will reduce the number of manual secondary
checks that have to be performed. More people will get an
instantaneous response.
[Mr. Divine's testimony may be found in the appendix.]
Chairman Musgrave. Okay, I think I'll go ahead and open it
up for questions. We want to be very respectful of the time
here.
Congressman Calvert, in H.R. 19 there was a tiered
implementation program that I thought was very reasonable for
small businesses, and it started out with bigger companies the
first year, clear down to seven years for the smallest of the
small businesses.
Do you have any insight as to why that was not included in
the final product? It just seemed to be so reasonable and
something that people could appreciate your concern for small
businesses and the burden.
Mr. Calvert. As I mentioned, as an employer myself and
recognizing the fact that we have 12 million--up to 12 million
people working in the United States today, that you can't just
immediately cut that labor off without having some negative
effect in the economy.
And so, we tried to work out a legislative fix where we
would phase in this program over a period of time, starting
with 10,000 employees and more, the Wal-Marts of the world, and
5,000 the next year, 2,500 the year after that, so forth and so
on, until we got to zero over seven years time. That would give
enough time for the agencies to gear up for a program of some
significance.
Fight now, as was mentioned, we have approximately 10,000
employers on the program, that would go to millions when we get
to this program as a mandatory system.
Chairman Sensebrenner wanted to move this program sooner
rather than later. He has a two-year phase in for all employers
in the United States in the final version that came out of the
Judiciary Committee and was reported off the floor. The Senate,
I'm not quite sure of how they, you know, will phase that in.
That would have to be negotiated in the conference report, in
fact, there is a conference report.
But, I think that, quite frankly, realistically, I think
that a phase in would not be a bad idea, to make sure we give
employers enough time in order to do the right thing. I'm not
out to punish employers. You know, as an employer, we run into
government agencies often, and we want to make sure that we use
a carrot approach rather than a stick approach, and get
employers to do the right thing, which I think most employers
want to do, and not to get into a punitive mode as far as how
we get people to initiate this program.
Chairman Musgrave. Thank you very much.
Mr. Lipinski?
Mr. Lipinski. Thank you, Madam Chairman.
I want to first thank Representative Calvert for his expert
testimony here, not just as a Member of Congress, but also your
experience as a small business owner. We very much appreciate
that.
I want to focus my questions primarily on Mr. Divine.
Representative Calvert, you can jump in here, if you would
like. A couple of things that I'm wondering about. It seems
that we are really going to have to expand from this pilot
program if we are going to be covering everybody, 407 employers
in Illinois just seems like a very small number.
You were saying the requests for FY07 from the
Administration is $110 million to expand the pilot program. How
much is going to be needed, what kind of appropriations are we
going to need to be able to make this a system that can cover
everybody?
Mr. Divine. Well, we are already making the systems changes
in terms of the technology, so that, as I said, the employer
gets an immediate answer the first time almost every single
time, and we reduce the delay for the employer, the cost for
the agency to try to run that down.
The rest of it includes outreach to employers who need to
participate, assistance, training, and also monitoring and
compliance, because as the Congressman mentioned it's not
foolproof, and we have to have some compliance capability to
monitor trends and detect patterns of abuse.
Mr. Lipinski. Do you have any idea how much this is going
to cost? We certainly have, up until this point, been cutting
back on the amount of money towards, you know, any type of
enforcement. Now, turning around to what really needs to be a
really huge investment it would seem, to be able to make this
work, do you have any idea how much it may cost?
Mr. Divine. Well, the President's request for `07 is $110
million, and--
Mr. Lipinski. But, down the line, do you have any idea how
much more it's going to cost?
Mr. Divine. I can't say specifically, because we don't have
experience with the system to roll that out to every employer,
but, that's the plan.
Mr. Lipinski. I'm not trying to--you know, I think that it
will be money well spent, I just wanted to try to get some
sense of that.
Congressman Calvert?
Mr. Calvert. Yes, Mr. Lipinski, I would point out, by the
way, and just to confirm what the gentleman is saying, that
right now the program is at 98.6 percent accuracy rate. It's
almost 99 percent. Obviously, if you expand the program very
quickly that may affect accuracy, but still I think we can make
it very accurate.
Millions of credit card transactions every single day take
place in America, with virtually--everyone has a high degree of
confidence in using their credit card. I mean, you know, at
least, you know, most of us anyway.
But, the cost of this, I think eventually, can be borne by
those who are not following the system. You know, there is, for
those who knowingly hire people illegally, and I think we ought
to give a lot of discretion to the regulators in making sure
that we don't fine people immediately, give them every
opportunity to follow the law, but the fact is, is that there
are people out here, believe it or not, that knowingly hire
people that are here illegally. And, in my opinion, they should
be fined, and those fines should help offset the cost of
running this program. And, I think that that can go a long way
to doing that.
In the initial period of time, we really don't know what
it's going to cost, until we get this up and operating, but
it's really not that complicated a system, though it seems
complicated, simplistically we are checking a name against a
number.
Mr. Lipinski. I certainly agree with you that those who
are--who are really violating the law, they should be fined,
good place to get the money, we should be serious about
enforcement.
I think, Mr. Divine, did you have more information there?
Mr. Divine. Hot off the presses, as it were, I'm told by
people who will have to get it done, that the $110 million gets
all 7 million employers on board by the end of the Fiscal Year
`07, and that for `08 the cost would probably go up a little to
fully fund the positions that were obtained in `07, and hire
about 40 more status verifiers. You know, when you talk about
the scale that you expand to for all employers, even though we
reduce the percentages the numbers go up, in terms of the work
you have to do to run down. That's the best information I've
got.
Mr. Lipinski. Thank you, I see my time is up. I have
another question, but we'll get on to other people asking
questions.
Chairman Musgrave. Okay.
While we are talking about the cost of the system, in your
written testimony, Mr. Divine, you talked about a fee that
would be assessed to pay for the system, and I have a huge
problem with someone having to pay a fee to comply with the
law. And so, elaborate a little bit on that, if you would,
please.
Mr. Divine. Well, I guess for USCIS, which is
overwhelmingly a fee-funded agency, and if the budget request
is granted for this year, it will be one of the only
appropriated activities in this agency. And so, I guess there's
sort of a theory that we come to things with that, if the cost
of it can be borne by those who are using it, as is in the rest
of our business, then that's something to consider. It
certainly would reduce the amount of appropriations. It's
certainly a policy call for the appropriators to make, but it
certainly would ensure the integrity and funding of the process
if we had that funding stream.
Mr. Calvert. I would point out one thing, Ms. Musgrave. The
system as it exists today is voluntary, and as was pointed out
in the testimony it's been phased in over a period of ten
years. And so, employers have to voluntarily involve themselves
in the system and pay that fee if they so choose.
If it becomes a mandatory system, in my opinion, there
should not be a fee, and that the appropriators should find
money, as we have for this year, and I believe that any
penalties, and, hopefully, we don't have penalties, hopefully,
the employers do the right thing, but those penalties should go
toward the agency to help offset their costs.
Chairman Musgrave. Thank you.
Mr. Calvert. Offset the appropriation.
Chairman Musgrave. Thank you.
Mr. Davis?
Mr. Davis. Thank you very much, Madam Chairman, and I thank
you and Mr. Lipinski for calling this hearing. Let me thank
both of our witnesses.
Representative Calvert, let me begin with you, and ask what
exactly is it that you are trying to accomplish with your
legislation?
Mr. Calvert. Well, I'll just give you an example. When I
was in the restaurant business, you know, I had many people
come in and apply for work, and we would always file the I-9
forms that we were obligated to under the law, under the 1986
Immigration Act, and people would hand me identification.
As required under the law, you have to--we need to xerox
two identifications, stick it on the back of the I-9 form,
usually a driver's license, or a Green Card, but in every case
a Social Security card.
There's no way for me to tell whether that Social Security
card was a valid card or not. We are not checking people, we
are checking documents, and many people I knew were using
invalid Social Security cards.
Well, let me tell you, there is no way that you could tell
the difference between an invalid Social Security card and one
that is a valid Social Security card. The counterfeit business
is pretty good, and the documents that the folks use to get
work are very good.
And, as you probably know, Mr. Davis, it's illegal for me
as an employer to ask a person's status, an individual status,
I can't check an individual under the law, under the Civil
Rights Act. The only thing I want to do is check the voracity
of the document.
So, this legislation does, it doesn't check people, it
checks whether or not the Social Security number that's being
used is a valid number, that's all it does, and that's all we
are attempting to do, is that people use legal documents when
they apply for work, and I think that's important, not just for
the employer who wants to hire people who are here legally, but
also for national security reasons. People use invalid
documents, and so that's what this legislation attempts to do.
Mr. Davis. And now, the potential employer knows at least
in his or her mind that the document used by the applicant is
not matching, as being a legal document.
Mr. Calvert. Once I determine to hire an individual, I
check that number and find out that it's an invalid number,
I'll give that--under the law, the employee has some time to
try to fix it, if, in fact, the employee says, well, Social
Security made a mistake, or whoever, some agency made a
mistake.
But, yes, it's just making sure that the Social Security
number is a valid number.
Mr. Davis. Now, if we should find, and that's not
necessarily a part, though, that the employer, then goes ahead
and willfully hires an individual, do we seek any kind of
additional penalty?
Mr. Calvert. Well, under existing law, under the law that
exists today, that if an employer knowingly hires someone here,
someone that's here illegally, they can be fined today. The
problem is, is how you prove they hired somebody knowingly
illegally.
Right now, before the Basic Pilot program, there was no way
you could determine whether or not the documents were valid or
not, so you couldn't fine the employer if he filed the I-9 form
properly, put the forms on the back of the file, so it was kind
of a wink and nod system, quite frankly, since 1986. Everybody
did it, everybody knew it, including myself. I'm probably the
biggest sinner in Congress. I mean, I hired a lot of people,
but there was no way that I could tell whether or not the
documents that were being used were valid documents or not,
until we had the Basic Pilot program.
Mr. Davis. And now, we would know, and so this could
actually cut down on illegal immigrants filtering into the job
market, which could take away the concerns expressed by people
that illegal immigrants are undercutting the labor force
because they are not illegal anymore.
Mr. Calvert. Yes, sir, you are exactly right. I mean,
people who are using fraudulent documents to get work will not
longer be able to do so, and people who have correct documents
will be able to get work, and that would remove the ``job-
magnet'' from people coming from outside of the United States
into the United States to obtain employment.
Mr. Davis. So, I would then hope that the outcome of that
would ultimately be that some individuals who take the harshest
views and positions, relative to non-entry of immigrants, that
might lighten them up a little bit. They may not be as opposed,
because they don't have that factor to say, here's part of our
rationale.
Mr. Calvert. I might point out, my district is 45--was 45
percent Hispanic. Most of the people that are in my
congressional district are in favor, most of the Hispanics are
in favor of a verification program, because they want--they
don't want to be discriminated against, quite frankly, the
people that are here legally.
And so, they believe that it's a good system to verify
whether or not the documents are correct when people apply for
work.
Mr. Davis. Well, I want to thank you very much, because it
certainly has helped me. I view myself as not being opposed to
individuals coming into the country, but I certainly don't have
any problem with finding out who is legal and who is illegal.
So, thank you very much.
Mr. Lipinski. Thank you, gentlemen.
Chairman Musgrave. Thank you, Mr. Davis.
Maybe, I don't know which one of you wants to answer this,
but there is a tension between Immigration and the Department
of Justice. You know, the Department of Justice assuring that
there's not discrimination in hiring, and Immigration making
sure that people are legal. This is the tension that we always
come down to. Could you comment on that, please?
Mr. Calvert. I think the important difference here is, we
are not checking people. We are not checking Ken Calvert, or
Ms. Musgrave, we are checking documents. We are checking
documents to see whether or not they are valid or not. And so,
when people use invalid documents to obtain work, unless they
can fix that problem by finding proper documents, that they
cannot have work. We are not checking individuals, that's the
difference here.
So, it's non-discriminatory, because every single person
who applies for work, every single one, must use valid
documents in order to obtain work. And so, the question you've
got to ask yourself, and maybe there are some people in this
room, who is in favor of using invalid documents to obtain
work? I mean, how can you say I'm for using invalid Social
Security cards, or invalid driver's license, or whatever, in
this case a Social Security card because we can check the
number versus the name.
Chairman Musgrave. Mr. Udall.
Mr. Udall. Thank you, Madam Chair.
This is a good opportunity, I think, for us, Mr. Calvert,
having you here, and having actual experience on this, and I
applaud your effort to try to improve the system.
My memory is when we passed that 1986 law, and maybe you
can help enlighten me here, early on there was a major effort
by the Federal Government to prosecute employers for knowingly
hiring illegals. And, it seems like that was dropped very
quickly. I mean, and I'm wondering what changed in that period.
I mean, the law went into effect, I believe what the consensus
that was reached, is that employers were the magnet that were
drawing people here, and in order to solve the overall illegal
immigration problem you had to deal with the employer part of
it.
And then, somehow that was dropped, and now we are trying
to get back to it again, but do you remember what I'm talking
about and what happened there?
Mr. Calvert. I remember as an employer. Now, you may want
to hear from the agency itself to give their perspective on it,
but I'll give you my anecdotal information.
Back in the days when the program first began, Immigration
would come in and they would pick up your I-9 forms and they
would check those I-9 forms to try to verify whether or not
people had status to be working, say, within my restaurant,
restaurants. And then, they would notify you of a list of
names, and then they may come down and visit your restaurant
one day and pick those folks up without any announcement.
Well, employers started yelling and screaming, saying, hey,
look, you know, we did the right thing, we filed the I-9 form,
we put identification on the back, just like you told us to,
and then you come in and, you know, say a farmer in the middle
of harvest, or a restaurant guy in the middle of the lunch
shift, or a manufacturer in the middle of the day, and you pick
up all of our employees, you know, and then we lose a day's
work and it puts us, you know, in a bad position.
So, I think there was a lot of pressure on the agencies and
they kind of stopped.
Now, the agency might want to give their perspective, but
that's my opinion about what happened in those days, and there
were huge pressures because companies needed these employees
here.
Mr. Udall. Right.
Mr. Calvert. I mean, that was the basic response that
people were saying, there was no way for the employer to know
who they were hiring.
Mr. Udall. Yes, but, please, thank you, Mr. Calvert,
please, go ahead.
Mr. Divine. I have to say that for 18 of the 20 years that
have ensued in the meantime I was a practicing lawyer, so I can
say, similarly to Mr. Calvert, from the private sector point of
view I was advising clients about whether to participate in
this program when it became available. And, echoing what
Congressman Calvert said, one of the primary reasons for a
human resources manager to push participation in this program
was to avoid that moment when the INS would come in and raid
the place and take away half the workers, and make it
impossible to make any kind of production. That's the kind of
event that gets the human resources manager fired, and that's
the kind of event that they would try to plan against.
And, this system allows for an employer to weed out clearly
unauthorized workers on the front end, and to do that in lock
step with every other employer in the industry, so that there's
not a competitive disadvantage from compliance.
And so, it all makes sense.
Mr. Udall. There's been a lot of discussion about a tamper-
proof verification card. I mean, where does that fit in this
picture?
Mr. Divine. We make tamper-proof cards, we make some that
aren't tamper-proof, and we are going to quit making the kind--
Mr. Udall. Mr. Calvert is smiling, so I'm going to get him
to comment on this one.
Mr. Divine. Well, tamper resistant, may I say, we make
tamper-resistant cards in the form of what we call the ``green
card'' that hasn't been green for a long time, but is the
Permanent Resident Card, and we also make a work authorization
card. We make two kinds. One is a kind that's issued out of a
secure facility that has a lot better features in it, and the
other is a kind that's made in local offices that can be
counterfeited quite easily. And, we want to quit making that
second kind, not only because it's counterfeitable, but because
the systems out of which it's made are not tied in well with,
and can't be tied in well with, the verification database.
So, we'll have more tamper-resistant cards when we have
only those two kinds, and whatever other similar kinds we make
for any other program that comes down the pike, but I think I
want to make clear, that is not foolproof, and there is no card
that can be made that cannot be counterfeited, or at least
can't be attempted to be counterfeited, and someone who wants
to make a card that has a stolen identity in it, and present
that to an employer, may still be able to get away with that,
because the data will verify in the system, because it's a real
human being. But, we'll get more sophisticated, because we will
be detecting patterns of use of those identities and will be
able to take action and make investigation with our partner at
ICE to sort that out when we detect that pattern.
Mr. Calvert. I would just point out that this bill, I mean,
Basic Pilot Employment Verification, does not get into tamper
proof, that's separate. However, I will say that somewhere down
the line we may want to look at that, but this legislation
doesn't get into national ID or tamper-free identification.
To get into that, you need--the only way to have a surety
in the program is to have a biometric identifier on the card
itself for each individual, and that gets into a whole
different debate, which is not this legislation.
Mr. Divine. And, I apologize if I misled you, when I say
``we,'' Department of Homeland Security makes those cards, that
doesn't apply to citizens who would not be having a Permanent
Resident Card or a work card to present.
Chairman Musgrave. Mr. Lipinski, I'm going to recognize you
for your second question.
Mr. Lipinski. Appropriate follow up on what we were just
talking about, I don't quite understand, if these cards you are
talking about, tamper-resistant cards, are going to go to
people who--they are not going to go to U.S. citizens, because
we are not going down the line of a national ID card, well
then, if you are impersonating, if you are coming in and you
are saying, I am a citizen, gives false documents, then how
does that help, because you are not going to come in and say,
well, I--if someone is not really eligible to work, aren't they
going to claim that they--probably going to claim that they are
a citizen, so then they don't have to, you know, bring you a
card that you are talking about?
Mr. Divine. That's an excellent question, and it gets to
the heart of it, and, again, it's not a foolproof system, and
people may very well claim to be citizens, and present
documents like that, just as well as they may claim to be a
permanent resident with a card that looks like the kinds of
cards that we give out, and that contains data of a real human
being whose information will match.
But, if you are working and living in Illinois, and the
same person--a person who uses the same data as you to validate
in Miami, and in Ohio, and in Minnesota, within a short period
of time, then our system will be improved to recognize that and
to cause action to be taken.
Mr. Lipinski. Yes, I agree, that is the key, as
Representative Calvert had talked about earlier, so as long as
there is that type of tracking to make sure that there isn't
duplications like that, and I certainly hope that that can and
will be done.
Thank you.
Mr. Divine. That's certainly the plan.
Chairman Musgrave. Mr. Davis, did you have another
question?
Mr. Udall?
Mr. Udall. No, no more.
Chairman Musgrave. Okay.
I'd like to thank our panel, thank you, Congressman, thank
you, Mr. Divine, for your testimony today.
Mr. Calvert. Thank you.
Chairman Musgrave. I'd like to call up the second panel,
please. We are going to have Mr. Jack Shandley on the panel,
Senior Vice President of Human Resources at Swift & Company,
from Greeley, Colorado; Mr. Mark Krikorian, Executive Director,
Center for Immigration Studies, here in Washington, D.C.; Mr.
Monte Lake, Partner, McGuiness Norris & Williams, American
Nursery and Landscape Association; Mr. Angelo Amador, Director
of Immigration Policy, U.S. Chamber of Commerce; Mr. Toby
Malara, Government Affairs Counsel, American Staffing
Association, from Alexandria, Virginia.
I'm going to ask you all when you speak to get the
microphones as close as you can, it's kind of difficult to
hear, and, Mr. Shandley, we'll start with you. Welcome to
Committee.
STATEMENT OF JACK SHANDLEY, SWIFT & COMPANY
Mr. Shandley. The penalty for sitting on the end, I guess.
Chairman Musgrave. You get to go first, yes.
Mr. Shandley. Thank you, Chairman Musgrave, Congressman,
members of the Committee, and other esteemed guests good
afternoon. My name is Jack Shandley, and I am Swift & Company,
as Senior Vice President of Human Resources. Thank you for
inviting me to testify today.
I will begin with some background information on Swift.
Swift is the third largest processor of both fresh beef and
pork in the United States. Our annual sales are close to $10
billion, and we employ 15,000 people domestically and 20,000
worldwide. We operate nine domestic processing plants in eight
states.
Today's meat processing industry is nothing like it was 10
years ago, much less 100 years ago. Our production facilities
are safe, clean, and pay wages and provide benefits that enable
our people to achieve the American dream.
Swift's production wages are at or above average rates in
the communities within which we operate. We offer affordable
healthcare benefits to employees who have been with us for at
least six months, and approximately 80 percent of our qualified
employees participate in our healthcare plans.
Our production employee turnover rate is lower than
industry figures for leisure and hospitality, construction, and
retail trade. All but one of our domestic plants are unionized.
Our safety rates, as measured by lost time injury
incidence, are comparable to all manufacturing businesses in
the U.S. Our Greeley beef facility recently completed 5.4
million operating hours without a lost time injury!
Simply put, this isn't the meat processing industry you
hear and read about in the media.
Regarding immigration reform, the ongoing highly charged
debate highlights the importance of this issue to the American
public. Similar to a large percentage of the electorate, Swift
& Company supports the development of common sense, balanced
and comprehensive immigration reform legislation that: 1.
Recognizes the U.S. economy's current and future needs for
workers to support growth; 2.
Protects employers that act in good faith to comply with
all legal hiring requirements; and 3.
Contains border security and guest-worker provisions.
Today's hearing clearly touches on my second point with
respect to the role of employers in the current immigration
debate. While Swift is clearly not a `small business'` by
definition, we do have a wealth of experience in the area of
employee identity verification that is relevant to today's
hearing.
Under the current U.S. law, employers assume responsibility
for verifying the identity and employment eligibility of newly
hired employees. As part of the hiring process, we are required
to complete and retain individual I-9 forms. When completing
the I-9 form, a total of 29 distinct documents may be used by
the employee to properly establish his or her identity. It is
important to note that we as employers are limited in our
ability to verify the identity of a new employee: we can't ask
for a specific identification document; we can't ask for
additional forms of identification; and we can't refuse to
accept any single eligible identification document.
Two federal departments enforce the verification and non-
discrimination provisions of existing immigration legislation:
the Department of Homeland Security's Immigration and Customs
Enforcement branch is charged with enforcing verification
provisions, and the Department of Justice's Office of Special
Counsel enforces anti-discrimination provisions.
This enforcement structure creates significant policy
tension between the need for employers to accurately determine
workers' eligibility versus the need to address privacy and
non-discrimination concerns.
In 2002 we experienced this policy tension first hand when
the Office of Special Counsel cited Swift for $2.5 million for
allegedly acting too aggressively when verifying the work
authorization status of new hires. To repeat, our company found
itself in hot water for allegedly pushing too hard to ensure
employees possessed the status they claimed! After two years of
close cooperation with Federal officials we ultimately settled
the case with no admission of guilt for approximately $200,000.
Since 1999 Swift has voluntarily participated in the
government's Basic Pilot Program to supplement our efforts to
properly verify the identity of all new hires. This program,
along with increased employer sophistication in processing
identity documents, was reasonably effective in helping to
eliminate the use of counterfeit paperwork.
However, over time weaknesses in the Basic Pilot weaknesses
came to light. As currently structured, the Basic Pilot Program
cannot detect duplicate active records in its database. The
same Social Security number could be in use at another
employer, and potentially multiple employers, across the
country.
The underground market responded by replacing counterfeit
documents with genuine identification documents obtained under
fraudulent terms--for example, state identification cards
obtained with valid copies of birth certificates. As an
employer, we must accept such cards on face value. Yet valid
birth certificates can be resold to another undocumented worker
for reuse in obtaining yet another official state
identification card.
As you can see, employers have no foolproof way to
determine if a new hire is presenting valid identification
documents created under fraudulent circumstances. Furthermore,
attempts to use additional means to determine employee
eligibility place employers in jeopardy with law enforcement
agencies. From our point of view, employers like ourselves who
are trying to abide by the law are not the problem in the
immigration reform debate--the current immigration system is
the problem.
In light of these problems we have three recommendations
for Congress on how to improve the current system:
First, create enhancements to federally-endorsed programs
that aid employers in their efforts to determine the work
eligibility of new hires. This could be achieved in a variety
of ways, from improving the Basic Pilot Program to creating a
tamper-proof, biometric national identification card. It is
unfair to blame employers for the failings of the system and it
is unreasonable to assume we can identify fraudulently obtained
documents. Give us a comprehensive, workable solution and we
will execute against it.Second, reconcile the policy tension
that exists for employers when managing the boundaries between
employee verification and non-discrimination. Remove the burden
of enforcement on both sides of the issue by granting safe
harbor to employers that participate in federal worker
identification programs.
Finally, continue the practice of voluntary participation
in federal worker identification programs. We have chosen to
participate in the Basic Pilot program because the large number
of applicants we process makes it cost-effective for us to do
so. Small business owners in America may not benefit from the
increased costs and delays associated with mandatory
participation in a verification program. Give business owners a
fair choice: risk breaking the law and suffer stiff penalties,
or participate in a federal identification program and gain
protection from liability.
Thank you for inviting me to speak today and for your
ongoing efforts to implement common sense, balanced and
comprehensive immigration reform legislation.
Thank you.
Chairman Musgrave. Thank you for your testimony, Mr.
Shandley.
[Mr. Shandley's testimony may be found in the appendix.]
Chairman Musgrave. Now we'll hear from Mr. Amador. Welcome.
STATEMENT OF ANGELO AMADOR, U.S. CHAMBER OF COMMERCE, ESSENTIAL
WORKER IMMIGRATION COALITION
Mr. Amador. Thank you.
Chairman Musgrave, and, Ranking Member Lipinski, I'm Angelo
Amador, Director of Immigration Policy at the U.S. Chamber of
Commerce.
Chairman Musgrave. A little closer, please.
Mr. Amador. More than 96 percent of our over 3 million
members are small businesses with 100 or fewer employees, 70
percent of which have ten or fewer employees. I am also
testifying on behalf of the Essential Worker Immigration
Coalition, which is the business coalition working on
comprehensive immigration reform.
I would like to start by clarifying that the Chamber does
support a new employment verification system, but like
President Bush we support such a program within the context of
comprehensive immigration reform. It has to be emphasized that
the overall system must be fast, accurate and reliable on the
practical real-work conditions.
As to the competing versions now in the Senate and the
House Immigration Bills, the Chamber prefers the Senate version
with some important exceptions, since both versions, as stated
earlier, relied on the same databases used in the Basic Pilot,
the discussion shall start there.
It is worth noting that on under both the House and the
Senate versions these electronic programs will retain proper
work requirements to verify the identity of workers, so it is
not like the credit card, as a lot of people have the
misconception that you can just run through the system.
Meanwhile, the Basic Pilot program's underlying databases
continue to be a problem. The records are not quickly updated,
there are often errors, particularly, with name changes due to
marriage, or compound names which are common among Latinos.
The most comprehensive independent study on the Basic Pilot
program found that 20 percent of properly work authorized
individuals are told initially that they are not authorized to
work.
Congress needs to ensure that any new system minimizes
errors and contains the mechanism in which errors can be
quickly rectified. Even an extremely low error rate of 1
percent would translate into the improper disqualification of
about 1.4 million potential workers, including U.S. citizens.
As to expenses, the GAO estimated that a mandatory Basic
Pilot program will cost about $11.7 billion per year, with
employers bearing most of the cost. In addition to
infrastructure and training, a great deal of staff time will
probably be spent verifying and reverifying worker Eligibility,
resolving data errors, and dealing with wrongful denials of
eligibility.
However, employers should not also be burdened with a fee
to pay for the cost of building the system itself. That is a
government function and should be paid for by the government.
There are five key components to create a workable
employment eligibility system within the context of
comprehensive reform.
First, the system should have a default confirmation, non-
confirmation procedure when the government is unable to reach a
final decision within a reasonable time frame. Keeping
employees in a tentative non-confirmation limbo is unfair to
everyone. Forbidding employers from filing tentatively non-
confirmed employees, but then using this data to investigate
employers is unacceptable.
To address this issue, the Senate version creates a final
default confirmation, non-confirmation when DHS cannot issue a
final notice of employment eligibility within two months of the
hiring date. While two months for a final default notice is too
long, this provision is still extremely important.
To reduce the lag time to a more reasonable time frame, the
time allowed for the government to reply should be reduced and
employers should be allowed to submit the initial inquiry about
two weeks before the first day of employment.
These changes will let the employer have a final
determination within two weeks of an employee's first day at
work, as opposed to two months.
Second, there should be a reasonable approach to the
contractor/subcontractor relationship and protections for
unintentional violations. Perhaps, the most important language
found in the House version was a result of an amendment by
Congressman Westmoreland of this Committee. The language
provides an exemption from liability for initial good faith
violations, which you mentioned at the beginning of the
hearing, and a safe harbor for general contractors who have
subcontractors that hire unauthorized workers without their
knowledge.
Third, the new system should be facing or tiered to
guarantee proper implementation at every level. GAO continues
to call attention to the weaknesses in the Basic Pilot program,
including delays in updating immigration records, false
negatives, and program software that is not user friendly. The
system should be expanded to the next phase only when
identified problems have been resolved.
Recently, GAO reiterated its conclusion that as of now the
Basic Pilot is not ready for the kind of implementation called
for in H.R. 4437.
Fourth, it needs an investigative system without
artificially creative incentive in favor of automatic fines and
frivolous litigation. We oppose the so-called employer
compliance fund found in the Senate version, which creates an
incentive for litigation, because under this scheme the fines
and fees supplement the agency's budget. Instead, in addition
to civil fines and criminal penalties being commensurate to the
violation, the system should allow for the issuance of warnings
and/or reasonable time for employers to correct administrative
errors without automatically being subject to an enforcement
action.
Fifth, there should be accountability structures for all
involved including our government. The possible harm to
employers, United States citizens and legal immigrants due to a
flawed system should not be taken lightly. The Senate version
holds the government accountable through the creation of a
review process that allows employers and employees opportunity
to contest findings. Workers could seek compensation for lost
wages due to agency error, and an employee fined by the
government due to an unfounded allegation could recover some
attorneys fees and costs that they prevail in their appeal.
Finally, employers will be at the forefront of all
compliance issues and should, therefore, be consulted into
shaping up a new system, to ensure that it's workable, reliable
and easy to use.
Thank you.
Chairman Musgrave. Thank you for your testimony.
[Mr. Amador's testimony may be found in the appendix.]
Chairman Musgrave. Mr. Krikorian.
STATEMENT OF MARK KRIKORIAN, CENTER FOR IMMIGRATION STUDIES
Mr. Krikorian. Thank you, Madam Chairman and Mr. Lipinski.
I'm the Executive Director of the Center for Immigration
Studies. We are a think tank here in town that examines
immigration and, incidentally, also a small business. I
appreciate the chance to testify today.
I wanted to ask three questions about employment, a
mandatory Employment Verification System. Would it be practical
to do? Would it be burdensome for business, and would it be
good or bad for business?
The first point is, would it be practical? I think the
answer is clearly yes, with adequate resources and adequate
political support, both from Congress and from the Executive
Branch, there is no reason that this shouldn't--we shouldn't be
able to implement a workable verification system.
Now, there were something like 56 million hiring decisions
last year made in the United States, average of 200,000 plus
each business day. Now, that sounds like a lot, but when you
put it in context it really isn't that big. Customers of iTunes
download five times that many songs every day. Wal-Mart checks
out 50 times that many customers every day, and VISA processes
500 times that many credit card transactions each day.
Now, obviously, there are going to have to be improvements
in the system, and some of the witnesses already referred to
those. The capacity will have to be increased. The speed of
entering in new information into DHS databases will have to be
increased. Most importantly, there's going to have to be
monitoring of the patterns of use, so that multiple uses of the
same legitimate numbers are exposed. But, those are things that
DHS is already working on and are achievable objectives.
Secondly, is it likely to be burdensome for business? As a
small businessman, I appreciate the multitude of government
mandates that are placed on small business. As I was writing
this testimony, I went into our break room and I looked on the
wall of all the disclaimers that we're required to post on the
wall, and there were references to the Civil Rights Act, the
Occupational Safety and Health Act, the Family and Medical
Leave Act, the Employee Polygraph Protection Act, the Drug Free
Workplace Act, the Youth Employment Act, Uniform Services
Employment and Re-employment Rights Act, among others.
Even George McGovern, when he became a small business man,
wrote that legislators and government regulators need to more
carefully consider the economic and management burdens that we
have been imposing on U.S. business. I couldn't agree more, and
that's why it's a good thing that such a program would not, in
fact, place disproportionate burdens on business.
The National Federation of Independent Business, the
authoritative voice of small business here in Washington,
polled its members and found overwhelmingly they were concerned
about illegal immigration, they wanted increased penalties
against crooked employers, and that a centralized verification
system like this would minimize whatever extra burdens that
verification might place on them. And, this isn't just
theoretical, because my own small business actually
participates in the verification program, and we have for more
than a year, and it represents no extra burden really for us at
all.
A growing number of businesses agree, voluntarily flocking
to the program over the past three years the number of
participants has quadrupled, including most notably in the news
Dunkin Donuts and Baskin Robbins now require all of their
franchisees to participate.
And, if and when Congress does make verification mandatory
for all employers, what we are going to see is creation of a
market for entrepreneurs to actually make whatever burden does
exist be even less and simplify it more, especially for small
business that doesn't have the infrastructure in place, the
H.R. departments, to do it on their own. DHS has already
provided for this, they have designated agents, they call them,
or at least an opportunity for companies to step forward as
designated agents to make it their job to do the Basic Pilot
process for others.
The first one that--there's already a firm that's been
approved as a designated agent, not only for doing Basic Pilot,
but for paperless I-9 forms as well. It's called Form I-9
Compliance in southern California, and other firms will follow
in their wake. And, they not only provide a paperless web-based
I-9 form that checks with Basic Pilot, but includes extra
services that entrepreneurs are going to think of that
government employees may not have thought of, for instance,
periodic reminders of upcoming expiration date for a temporary
alien worker. And, in a sense, what these firms do is what
Turbo Tax does for tax filing, they offer a user friendly, a
more user friendly interface, eliminate paper, reduce errors,
and file electronically.
The third and final point is, is this good for business?
And, you might say that, well, this isn't all that big a
burden, it's root canal, but the root canal doesn't hurt too
much. Actually, it's quite the opposite. A verification program
is good for businesses. I can see why business, small business
in particular, would be alarmed about all of this talk of
penalizing employers as part of enforcing immigration laws,
but, in fact, the verification system is not intended to
penalize employers, but to empower employers, so that they know
who they are hiring. It takes the guess work out of
establishing a legal work force, so they build their work force
on concrete, not on sand, a work force that doesn't run away
when there's an immigration raid, won't be arrested when the
inevitable immigration, broad national immigration crackdown
does come.
In fact, I would submit that public companies that are not
participating or exploring participation in the Basic Pilot are
neglecting their fiduciary responsibility to shareholders by
imprudent labor practices that jeopardize the stability of
their labor force. And, even privately-held companies, which is
what most small businesses are, while not answerable to
shareholders, nonetheless, have a moral responsibility to their
employees, their customers, their creditors, to conduct due
diligence in their hiring decisions.
And, let me just, my last point, to point out that
Congressman Lipinski's point of it being mandatory, so that
there's a level playing field for all business, is essential. I
remember hearing about a landscaper in southern California who
enrolled in the program, he was a patriotic employer, wanted to
do the right thing, but was undercut by competitors not in the
program. So, making it mandatory for all employers is, in fact,
a pro business measure.
Chairman Musgrave. Thank you for your testimony.
[Mr. Krikorian's testimony may be found in the appendix.]
Chairman Musgrave. Mr. Malara, we'll go to you now, welcome
to Committee.
STATEMENT OF TOBY MALARA, AMERICAN STAFFING ASSOCIATION
Mr. Malara. Thank you, Madam Chairman Musgrave, Ranking
Member Lipinski. My name is Toby Malara, and I'm the Government
Affairs Counsel for the American Staffing Association, and we
appreciate the opportunity to offer comments on the Employment
Verification System provisions contained in H.R. 4437.
ASA members provide a wide range of employment-related
services and solutions, including temporary and contract
staffing, recruiting and placement, outsourcing, training, and
human resource consulting. Member companies operate more than
15,000 offices across the Nation and account for more than 85
percent of U.S. staffing industry sales.
The staffing industry employs almost 3 million employees a
day ad more than 12 million each year. Staffing firms recruit
and hire their employees and assign them to businesses to
assist in special work situations. Employees work in virtually
every skill level and job category, including industrial labor,
office support, engineering, IT, legal accounting and
healthcare.
Most of ASA's members earn less than $12.5 million in
annual revenue and thus qualify as small businesses under SBA
guidelines. Like all staffing firms, they have unusually large
numbers of employees relative to revenue due to their workers'
short tenure. For example, it's not uncommon for a staffing
firm with annual revenue of $10 million to employee more than
1,000 employees each year. As you can see, any new employment
verification system will have a great impact on our members.
ASA also represents hundreds of firms that recruit and
refer individuals for hire by others. Unlike temporary and
contract staffing firms, traditional placement and executive
recruiters do not hire the individuals seeking employment and,
therefore, as we note later, such firms currently are not
subject to employment verifications, nor should they be.
While there are a number of points that we raise in our
written testimony, I would like to touch on two major points
today.
Under current law, staffing firms and other employers have
the option of verifying employment eligibility upon either the
offer of employment or at the time work actually commences. For
example, a person will walk into a staffing firm to apply for a
job. They'll go through an interview process, and the staffing
firm will determine if they are qualified for work assignments.
At that point, the person has been made an offer of employment
for the purpose of I-9 verification process, even though a
specific job assignment is not immediately available.
When an assignment does come up that the person is
qualified for, the staffing firm will call and notify the
employee, who will then go directly to the client's work site.
Many employees never return to the staffing firm's office.
Because these assignments must be filled on short notice,
it would be difficult, if not impossible, for employees to
return to the staffing firm's office to complete the
attestation and document examination process prior to going on
assignment.
Moreover, getting to the staffing firm's office would be a
significant hardship for employees who live far away from that
office or who rely on public transportation.
Staffing firms and other similarly situated employers have
the option of completing the attestation and document
examination phase of the verification process at the time that
they are offered employment. They should continue to have the
same flexibility in using any new electronic employment
verification system enacted by Congress.
Also under current law, the obligation to verify employment
eligibility generally applies only to employers, not to those
who merely recruit or refer individuals for employment by
others. There is a minor exception for those who recruit
agricultural or farm workers.
Traditional placement agencies and executive search firms
help match candidates looking for jobs with our clients, who
are perspective employers. Once a candidate is hired for a job,
they become the employee of the client, and the client assumes
the obligation of verifying their employment eligibility.
Currently, there's language in the House bill that would
make it unlawful to hire or to recruit or refer for employment
an individual without complying with the employment
verification requirements. We are concerned that this broad
reference to those who recruit and refer could again be
construed improperly as expanding the verification requirement
to all recruiters.
While there is other language in the House bill that
appears to limit the reference to recruiting and referring to
labor service agencies that operate day labor hiring halls, we
urge that the bill be amended to make that unequivocally clear
to avoid any misinterpretation.
We do not think that employers should have to pay a fee for
using the system, or that employers should have to reverify
their entire work force, unless there are extraordinary
circumstances, such as significant past immigration violations.
These issues are discussed in greater detail in our written
statement.
The American Staffing Association strongly supports
Congress' efforts to develop a new Employment Verification
System that is effective, efficient, accurate and reliable, and
we look forward to working with members of Congress and others
to bring such a system to fruition.
Thank you very much.
[Mr. Malara's testimony may be found in the appendix.]
Chairman Musgrave. Thank you for your testimony.
Mr. Lake, welcome to Committee.
STATEMENT OF MONTE LAKE, MCGUINESS, NORRIS & WILLIAMS, LLP
Mr. Lake. Thank you, Madam Chair and Ranking Member
Lipinski. I appreciate the opportunity to testify on behalf of
the Agriculture Coalition for Immigration Reform, including the
American Nursery and Landscape Association and National Council
of Agricultural Employers.
The coalition includes over 150 state, regional and
national agricultural organizations, representing thousands of
small farming, ranching and nursery businesses. It was formed
six years ago for the purpose of promoting comprehensive
immigration reform as it relates to agricultural employers.
My name is Monte Lake. I'm a Partner in the labor and
employment law firm of McGuiness Norris & Williams in
Washington, D.C., and I have represented many small businesses
engaged in agricultural and horticultural operations throughout
the U.S., in their efforts to comply with the requirements of
federal immigration and employment law over the past 20 years
since IRCA was enacted.
I appreciate the opportunity to address the issue of
employment verification. American agriculture will support
electronic verification of employment eligibility, as long as
the process is simple, manageable, and provides clear-cut
compliance responsibilities.
It is also imperative that Congress pass comprehensive
reform that ensures American agriculture an adequate supply of
legal workers to replace those that likely will be screened out
by an electronic verification system.
My comments on H.R. 4437, the House passed bill, are made
in the light of the failures of the legal compliance morass
that currently surrounds the Verification of work authorization
that's been addressed by some of the witnesses before me.
Employers should not face discrimination charges as a result of
trying to hire legal workers, but that's been the history.
Small employers want clarity, simplicity and a rational
system that facilitates legal compliance, and now is the time
to get it right after 20 years.
I ask that my written statement be submitted into the
record, and I'll be glad to answer questions after the
presentation of these brief oral remarks.
A new verification system should achieve, at a minimum,
seven goals.
One, it must screen out undocumented workers and provide
employers certainty that they have a legal work force, that
their training costs will not be wasted, and their businesses
later disrupted by revelations that certain workers are
illegal.
Two, it must reduce the number of employment documents. The
current menu of 29 different documents to establish legality is
confusing and leads to discrimination charges. ACIR supports
the establishment of a single Social Security type card for
purposes of employment verification, similar to the approach of
H.R. 98 introduced by Representative Drier. It would simplify
the hiring process, and help eliminate the problem of
discrimination that is a problem under current law. It's
simplicity that we seek.
Three, the new verification system should be implemented
over time, and should not be applied retroactively. Placing too
many demands, too soon, has the potential to overwhelm the
system creating compliance challenges and defeating its
purpose. The approach taken in H.R. 19, introduced by
Representative Calvert, who we heard here today, and commented
on by the Chairman, is a reasonable one that anticipates the
problem and would phase in perspective verification over a
number of years. The largest employers would be subject to the
system first, and the smallest employers several years later.
Four, because of the inherent tension that's been
referenced between verification and discrimination under the
law, the new law should set forth clearly any new duties and
rights related to discriminatory practices based on national
origin and citizenship status. H.R. 4437 merely directs the
Secretary of Homeland Security to evaluate the problems related
to this issue, but doesn't provide employers and workers any
guidelines.
Five, agricultural businesses often hire farm labor
contractors, which they consider to be the employers of the
workers they provide. Contractors have an obligation to verify
the status of the workers they supply. The law should make
clear that the agricultural business does not have a duplicate
verification obligation and can rely upon the verification of
the contractor.
Six, the penalties for verification paperwork violations
should be reasonable. Inadvertent mistakes, often repeated
through the hiring process, could incur fines between $1,000
and $25,000 per violation, per piece of paper, under the bill.
Small employers that span from family to hundreds of seasonal
workers each year, face hundreds of thousands of dollars in
fines under the provisions. We believe that Congress should
revisit this issue and provide a more reasonable approach.
And finally, seven, the legislation also must provide a
viable means for agricultural employers to obtain legal
workers. An effective verification system would screen out a
majority of the agricultural work force. The U.S. agricultural
work force has become increasingly populated by foreign workers
who lack work authorization, as reported by the last report of
the United States Department of Labor.
In anticipation of this problem, American agriculture came
to Congress ten years ago, when IIRIRA was considered, and
expressed support for electronic verification, as long as it
was accompanied by substantial reform of the H.288 Agricultural
Guest Worker Program. Because of the difficulties in using that
program, less than 2 percent of the seasonal agricultural work
force are brought in through it.
An employer enforcement only, or enforcement first approach
to immigration reform, that does not include a reform worker
program, will be disastrous for American agriculture. Not only
will field production jobs be lost, but for every field job the
three to four jobs in cities and suburban areas that provide
processing, packaging, chemicals, farm equipment,
transportation, and ports also will be lost.
We hope that America is not willing to export its labor-
intensive agriculture and rely upon foreign imports.
Thank you very much for the opportunity to testify.
[Mr. Lake's testimony may be found in the appendix.]
Chairman Musgrave. Thank you for your testimony. We may be
called for votes right away, so we'll quickly move through
questions.
Mr. Shandley, I was amazed when I heard you talking about
the incident in 2002, and the original fine was cited at $2.5
million because allegedly you had been too aggressive in
seeking proper verification for new hires, and I'm trying to--
it's kind of the darned if you do and darned if you don't
situation.
Could you elaborate a little bit on that experience, and I
assume a great deal of frustration that you were going through
with that?
Mr. Shandley. Thank you, Chairman Musgrave.
In elaboration, one of the things Swift & Company does,
both as a domestic employer as well as a global employer, is we
do want to have a very strong working relationship with all
agencies, and comply with the laws.
In the situation at hand, it basically was the tension that
was alluded to earlier, where circumstances at one of our
facilities, where they had documentation, they suspected that
they had passed the Basic Pilot program, they suspected that
there may be some problems with it, they tried to look into it
further, and ultimately got us in hot water through the Office
of Special Counsel.
And, I will sit there and say that at the end of the day
the working relationship between the INS then, or ICE now, and
the Office of Special Counsel, succeeded in working through the
issues, and the ultimate fine was really just--it was really a
cost avoidance of further litigation, not an admission by any
means. But, it does spell out the simple fact that we can
hire--we'll hire people using legal documents that were
obtained fraudulently, and that becomes, you know, part of the
issue that an employer faces. Our staffs are not trained to be
detectives at that level.
Chairman Musgrave. Well, Mr. Divine had said that if many
people were using the same documentation, you know, in a number
of states, I believe it was his example that it would be
caught. And, I noticed in your testimony that you see, however,
any kind of duplicate use of valid documents as a real problem.
Is that the case?
Mr. Shandley. Yes, basically, we have a lot of experience
with the Basic Pilot program, but it does have its flaws as
we've heard today.
The biggest flaw really is the person could take a
legitimate birth certificate, go to an office and get a
legitimate Social Security card, and that legitimate Social
Security card then goes to a state to get a state ID with a
picture on it. At that point on, that Social Security card and
the state ID, by law, we are required to accept, even though it
was fraudulently obtained.
The other issue that comes up is really the fact that has
already been mentioned, is unless you individually look at your
Social Security statement at the end of the year, and look at
where the income flow is coming from, you don't know how many
times or how many employers that same Social Security number is
being used.
The Basic Pilot is very good, and it's very quick in its
turnaround, and it's the right start and the right step, but it
doesn't go into the active Social Security numbers, and so
those active Social Security numbers, as it stands today, could
be used elsewhere and fraudulently. And so, that's the issue
that we have.
Chairman. Musgrave. Thank you.
Mr. Lipinski?
Mr. Lipinski. Well, let me first go through and just
quickly ask each one of you whether or not you think that the
pilot program can be expanded and can be used to cover
everybody, just very quickly, just say yes or no, and then
we'll get into more details.
Mr. Shandley?
Mr. Shandley. The answer is yes, but I'd like to expand on
that, if I had an opportunity.
Mr. Amador. It could be expanded, but in phases, if all the
problems are fixed. If not, it will be expanded but it will be
flawed.
Mr. Krikorian. Yes.
Mr. Malara. Yes.
Mr. Lake. I think it has to be expanded over time. It's
being used by 9,000 employers as I understand now, and we are
looking at 7 million, and we need to phase it in gradually.
Mr. Lake. Mr. Shandley, you seem to have the most concerns
about it. What are you most concerned about? We just talked
about the fact that, you know, on our first panel we talked
about you can pull out multiple times a Social Security number
is being used, you can flag that, pull that out, find the
problem. You said that can't be done right now. So, what do you
sort of boil it down to? Very quickly, what do you think are
the most important changes that need to be made?
Mr. Shandley. Let me qualify, Your Honor, it absolutely can
be and should be expanded, and I believe it should be expanded
immediately, sooner rather than later.
We've taken it upon ourselves, as a major employer, with,
you know, our payroll is over a half a billion dollars, and if
you simply use the force multipliers that's a lot of economic
impact in the regions that we operate.
We've taken it upon ourselves to force our subcontractors,
and I use the word force figuratively, or push our
subcontractors to use the Basic Pilot program. By law, they are
not required to do that. And yet, it's our effort, as a private
employer, to try to get the Basic Pilot used in a broader
fashion, so that's my point of clarification. I believe it can
be, and should be, accelerated, enhanced. It's a procedural
issue, it's a process issue, it's a database issue, like we
talked about earlier today.
Mr. Lipinski. Mr. Amador, would you want to add?
Mr. Amador. Yes, I would like to add that it's important to
mention that in both bills, and all through immigration law, as
the fees increase for enforcement there's also fee increases in
fines and broader investigations for civil rights violations.
So, we are looking for a way, you know, and we are looking
for fast answers as well. You know, when you have people on the
tentative non-confirmation, and we read in the paper of a
member being sued by an employee because they fired him, the
moment they got a tentative non-confirmation the reaction from
the employer is, I don't want anything to do with this, I want
to fire the individual. And, we want to be able to get a fast
and reliable response so the employer can either hire and keep
the individual, or fire the individual.
And, right now, on the Basic Pilot, this tentative non-
confirmation that can go on forever doesn't give you that
security.
Mr. Lipinski. Did you say there's a 25 percent false
negative?
Mr. Amador. 20 percent of the first initial response is a
tentative non-confirmation, that end up being later on
confirmed as work authorized. And, we understand that the
numbers have gone down, but we haven't seen any new official
data come out from DHS saying what the new number is.
Mr. Lipinski. And, what needs to be done to change that?
Mr. Amador. Well, the databases have to be improved, but
the mechanisms and the procedures, as Calvert said, shouldn't
be just penalties and penalties, there should be incentives
there, and there should be some form of default confirmations.
You know, the employer at some point needs to feel
confident that they use the system, they did everything they
were told to do, and then they can rely that, you know, they
are not going to come and do an investigation based on the
tentative non-confirmation of employees they are by law not
allowed to fire.
So, there are many things that we recommend could be done
to improve it, but one thing that we must point out again is
that we are talking within the context of a comprehensive
immigration reform. One of the things Congressman Calvert
testified to was that there would be a cost to the economy to
get out these workers from the economy right away, and I would
expand and say, not just if you take them right away, if you
take them out of our economy period.
Mr. Lipinski. Mr. Lake, how long do you think it's going to
take?
Mr. Lake. I think hearing Congressman Calvert, who has a
lot of experience with this, and put a lot of time into it, a
seven-year period phased in, with largest employers first,
makes sense. We've gotten 20 years in trying to adopt this, ten
years since IIRIRA started the pilot. Let's do it right. The
problem if we don't do it right is that small employers can't
get responses from the system, and they have the ongoing duty
to try to follow up each day to get into the system, and
meanwhile they are making new hires, and the problem is
compounding. You are going to have system break down of its own
weight, and it's going to breed disrespect, and we are trying
to make it work right.
So, I think start with the largest employers, and I
represent them, who want computer-based systems, who want to
copy the documents electronically, who want to have electronic
signatures, they are equipped to do it, and ready to do it,
start with the big ones first, and gradually phase in.
If there's a capacity to do it more quickly, as the
experience demonstrates, Congress can come back and, perhaps,
accelerate it.
Mr. Lipinski. Thank you.
Chairman Musgrave. Mr. Akin?
Mr. Akin. Thank you, Madam Chairman, especially allowing a
guest in to your hearing.
Chairman Musgrave. Happy to have you.
Mr. Akin. When we voted on the Comprehensive Immigration
Bill the end of last year, as a guy that used to work in
business, and used to work for IBM, my understanding of what we
were talking about, and maybe I'm wrong, was something that's
pretty straightforward for an employer. You simply call up,
they have a prospective employee sitting there, they call up
and they say, what's your Social Security number, they check it
and find out what his name is and his birthday is, and see if
they all match.
If they do, they can hire him. If they don't, they say,
we're sorry, we've got some sort of a problem, you need to go
talk to some government office.
I was thinking of something that would be very simple, an
immediate test, and second of all, that's foolproof for many
lawsuits, either from the government in terms of fines, or from
anybody else who says you are threatening somebody's rights,
because every single employee, just do the same process.
That was my concept of what they were talking about. Is
that your concept of what's going on, or are you talking about
something where you hire somebody and later on try and figure
out whether they are legal or not?
Mr. Amador. If I may add, the House bill is written within
the context of current law, so all of the other penalties still
apply. They actually increased the penalties for civil rights
violations, but they all fall within the INA.
Mr. Akin. What I'm talking about, could you ever have a
civil right violation for doing that, what I just said?
Mr. Lake. I think, Congressman, the issue is this, as Mr.
Divine from the Administration, who is implementing the system,
talked about, you have citizens who are putting forth a Social
Security card, and that's more straightforward, and I think
it's the simplicity that you talk about.
But, some of the discrimination lawsuits we've seen involve
alien cards, which are also a part of the system, and which
goes through the Department of Homeland Security's database.
And, as we heard from some of the witnesses previously, a lot
of these cards either have temporary status, they are expired
as a matter of law, but the person may not have a new document,
and the government doesn't get in the updates on the status as
readily as they do, for example, on Social Security cards.
And so, if an employer believes that a person is an alien
and has an expired card, and terminates them, when, in fact,
they are still legal, but it hasn't gotten into the database,
that's when you are looking at problems that arise that raise
the problem of discrimination.
So, it's a matter of the government having time to get the
capacity up on the alien side, as well as the Social Security
side, to make the system work, and that's why we hope that it's
done right so that people aren't discriminated against
unfairly, and that employers don't make mistakes that get them
into that position.
Mr. Akin. And, you are saying that's going to take seven
years to get that up and going properly, is your guess?
Mr. Lake. I'm just relying upon the study of Congressman
Calvert, who has looked at this issue, put a lot of time into
it, was a small employer, and I think that's a reasonable
approach.
Mr. Akin. And, this system would apply to any American that
wants to get a job, right? It makes it hard to say you are
discriminating, because anybody that you are going to hire you
are basically doing the same check on that.
Mr. Lake. It applies to any American citizen, as well as
any alien, whoever it is, anybody's warm body walks up, we are
not discriminating against anybody. You just basically check
everyone.
Mr. Akin. Okay. Well, I've heard similar estimates that
that database is hard to--it's a lot harder to bring it up and
make it work than what it would appear that it should be simple
on the surface, it's not so simple.
Okay, well, I think that answers you questions.
Chairman Musgrave. Thank you.
Mr. Lipinski, did you have another question?
Mr. Lipinski. No, I have no further questions.
Chairman Musgrave. I want to thank the panel for your very
good testimony. You've given us good information today, and
thank you for appearing before the Committee.
This meeting is adjourned.
[Whereupon, the Subcommittee was adjourned at 4:17 p.m.]
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