Should Employer Fines Be Cut Because of the Recession?

By David North on March 1, 2011

When jobs for American residents are scarce, should an employer pay smaller fines for ignoring the rules on hiring illegal aliens because there's a recession?

That's the odd position taken by an administrative law judge (ALJ) who works for the Executive Office of Immigration Review (EOIR), an arm of the U.S. Justice Department.

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One might think that violating the employer sanctions law, more than 100 times in this case, would suggest that serious penalties would be imposed whatever the economic climate, but a civil servant ALJ, and, apparently, the leadership of the Immigration and Customs Enforcement (ICE), have decided otherwise.

It all fits in comfortably with the Obama administration's ongoing decision not to be too vigorous about enforcing the immigration law.

The case was the subject of an article on p. 481 of the February 7 issue of Interpreter Releases, the trade paper for the immigration bar (that arrived the mail yesterday). While the article is not available on line, the full decision is here.

The sloppy employer, Snack Attack, a Subway franchisee in Fayetteville, N.C., with an apparently high staff turnover, had simply ignored the federal legal requirements for gathering information on the people it hired in 97 cases; it did not ask them any questions, or seek any documents, as all employers are required to do. In another 11 cases it did not require full compliance with the law. These are the so-called I-9 requirements, designed to make it easy for employers to avoid hiring illegal aliens.

This was an open and shut case; according to the ALJ's decision: "There is no genuine issue of material fact respecting liability for the violations alleged . . ." The ALJ goes on to say that the case involves "bad faith" on the part of the employer and that the "violations were serious in nature."

Yet, despite all these comments, the ALJ decided that she should reduce the penalties proposed by ICE from $111,078 to $27,150.

Why the reduction?

According to the IR report the ALJ wrote: "I take administrative notice . . . of the fact that the health of our economy at the present time is poor and that unemployment is high . . ."

She also wrote that: "penalty should not be so onerous that employees have to lose their jobs or employers are forced out of business . . ."

I would think, to the contrary, that if jobs are scarce that would be an excellent time to punish employers for not following the rules about who is to be hired, and who is not to be.

Further, why not force an employer out of business who, on more than 100 occasions, violated the federal law?

Had the employer been driven out of business, in this case, the general counsel of Subway, a major franchise operation, would probably have been on line the first thing the next morning warning all the other Subway franchisees to start paying attention to the federal law on hiring illegals, or else face the fate of the Fayetteville operation.

Hard on the local operation, to be sure, but a fine example for everyone else in the system.

As to the argument that closing the operation would create unemployment, well, maybe briefly, but the chances are that a Subway operation closed by federal action would quickly be replaced by another snack shop, or maybe another Subway outlet, and that no jobs would be lost over any period of time by the closing of the law-breaking employer.

There's another disturbing element of the case, something IR did not explore. As part of her rationale for the lower fines, the ALJ reported, according to IR, that: "ICE acknowledged that there is no way of determining whether any of the 97 individuals for whom there were no I-9s were unauthorized to work in the U.S."

So here we have a unit of Immigration and Customs Enforcement, in North Carolina, telling the ALJ that they could not determine whether any one of 97 workers in Fayetteville were, or were not, illegal aliens. Really? I thought it was the business of ICE to make such determinations.

Had ICE looked into the matter and found that one or more of the 97 were, in fact, illegal aliens, it would have weakened the government's overly tolerant posture in this case. Maybe that's why ICE did not look.

What it suggests is that ICE did not want to make those determinations, or that the ALJ did not push the matter very far. Sometimes it is easier to be seen as ignorant or lazy, rather than to push for what may be an awkward truth.

Whatever the factors involved in this odd bit of decision-making it is sad and ironic to find the government going soft on enforcing Employer Sanctions because we are in a recession.

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This was a decision by the Office of the Chief Administrative Hearing Officer, a small unit within EOIR, and an organization roughly comparable to the Department of Homeland Security's Office of Administrative Appeals.

Both OCAHO and OAA hear appeals regarding different parts of the immigration law. But a major difference is that OCAHO, unlike OAA, tells the public the names of the players. In this case the employer was, as noted, Snack Attack, Inc.; the name of the owner, according to the decision, is Maher M. El-Hatto (with a footnote adding "the name also appears in the record with variant spellings as El Hatto, ElHatto, Elhatto, or simply Hatto"); and the name of the judge is Ellen K. Thomas.

In OAA decisions all such information is redacted, as mentioned in an earlier blog of mine.