The following article is a prime example of why I am an insomniac…!
I wake up at night and worry about every person who states, “we are good on our I-9s..” or, “…we conducted an internal audit and made our corrections so we are good…” This is more than a sales pitch designed to frighten people into spending useless dollars on the thing that may or may not lurk under our proverbial beds. This is real – and it is terrifying the level of reach that ICE has when it comes to businesses.
Know that AskLinda HR Consulting Services has a way to help mitigate the risk your company faces. The solution is much less expensive than any fine potential you may be facing from ICE.
So, my loyal blog readers, if this article causes you to wake up in the middle of the night, make sure you drop me a line or two and see how I can help. Chances are good I will be up, hoping the seriousness of the situation has created an urgency to get third-party help. At least knowing that we are here might let you get back to sleep.
By the way – note that the company below used E-verify and they were NOT a construction company…
Immigration Violations Cost Resort Chain $2.5M – What Is Your Compliance Exposure? by Dawn M. Lurie
September 23, 2014
This case is a stunning example of the importance of immigration related monitoring, compliance and oversight by the C-suite, as well as the exposure and cost to companies that do not prioritize such compliance and dedicate the necessary time, resources and funds.
The Sinclair Services Company owns and operates a number of high-end hotel and resort properties in Utah, Wyoming, Arizona, California, and Idaho under the Grand America Hotels and Resorts label. Through cooperation and lengthy negotiations, the company entered into an agreement with the US Attorney’s Office and ICE’s Homeland Security Investigations (HSI) forfeiting $1,950,000 to the Department of Homeland Security.
The case reveals interesting facts about the need for company compliance and oversight. It also highlights the lengths some will go to in an effort to keep an existing workforce intact, even one filled with unlawful workers.
- September 2010: HSI issues a Notice of Inspection (NOI) initiating an administrative audit of the company’s Form I-9s. At this time Grand America was an E-Verify participant.
- After completing the audit, ICE issues a Notice of Suspect Documents determining that 133 undocumented individuals were working for Grand America without proper work authorization.
- September 2011: ICE closes out the case by issuing a “Warning Notice” to Grand America, and the hotel chain terminates the individuals in question.
- Subsequent 12 months: ICE discovers employees of Grand America had created three temporary staffing agencies in order to rehire a portion of the population of the employees previously deemed unauthorized. Forty three of the same employees are rehired through these temporary staffing agencies, mostly under different names and/or Social Security numbers using fraudulent identity documents.
- September 2012: Search warrants are executed against Grand America.
- September 2014: Case settles with $1.95 million forfeiture and compliance program instituted.
Exposure and Liability
According to Kumar Kibble, the special agent in charge (SAC) of HSI in Denver, the office which oversees Utah’s ICE investigations, “[a]ll industries, regardless of size, location and type are expected to comply with the law. As this significant settlement demonstrates, there are real consequences for businesses that employ an illegal workforce.”
In exchange for the cooperation of the company, the US Attorney agreed to forgo criminal charges against Grand America or its executives. The company’s cooperation in providing the government with all related evidence obtained through its own internal investigation was likely used by their attorneys to assist in securing the agreement and keeping high level executives and others shielded from personal liability. Not surprisingly, the individuals involved in the scheme have been fired, and it is expected they will be prosecuted to the fullest extent of the law and held personally liable.
According to the Department of Justice, the agreement also requires the company to take substantial remedial measures and estimates the cost of implementing such measures at $500,000. Specifically the settlement agreement referenced the company committing to an “extensive review, regarding its hiring procedures and workforce at all of its properties and re-trained all of its hiring managers regarding immigration laws and the company’s immigration policies”. Among the remedial measures are:
- Mandating new immigration policies
- Incorporating immigration law compliance clauses into labor service contracts
- Re-training of human resources employees on Form I-9 procedures
- Agreeing to continue to use the E-Verify employment eligibility verification website
- Hiring immigration and corporate counsel to advise on these issues.
What should employers take away from this?
Employers, take note: the frequency of ICE investigations is expected to increase as FY 2015 begins and immigration reform remains on the back burner in Washington. Alleged compliance failures (including those discovered during routine Form I-9 inspections) will be tracked and acted upon. Tips and leads will continue to be the main manner in which an investigation is initiated, including scenarios involving whistleblowers. Companies who were previously audited are now likely to be re-audited. Interestingly while re-audits have been a standard part of ICE’s protocols, they are utilized with varying frequency by different ICE offices across the country.
Another likely implication of this case will be some sort of internal review at ICE/HSI to ensure auditors and agents apply higher scrutiny where large numbers of unlawful workers are involved, prior to issuing Warning Notices. Companies should not be lulled into a false sense of security when they are successful in challenging ICE/HSI or when they receive a low fine or a Warning as a result of an investigation. Instead, companies should see it as an opportunity to determine the need for a full house clean-up of their immigration program. When compliance is not taken as seriously as it should be, a $2 million dollar payment ends up being the wakeup call.
Key components to any immigration compliance program include:
- Dedicated resources and commitment to promoting a true culture of compliance
- Written hiring and employment eligibility verification policies that ensure consistent recruitment and employment
- Internal compliance and training programs related to verification processes, to include completion of the Form I-9, how to detect fraudulent use of documents in the verification process, and how to use E-Verify as a best practice or where required—either due to state and local mandates or by virtue of the Government contractor Federal Acquisition Regulation (FAR)
- Internal audits to minimize liability when conducted in conjunction with guidance from experienced counsel
No one can whistle a symphony. It takes a whole orchestra to play it. ~H.E. Luccock
On October 13, 2012, 33 men were finally rescued after spending 69 days trapped over 2,000 feet underground in a collapsed mine shaft in northern Chile.
I watched the scene, captivated by the strength of the men to have survived such an ordeal with only minor injuries, but the human resource professional in me began to focus on one question: how can one possibly survive with ones co-workers 24 hours a day for 69 straight days in a space that was about the size of a one-room apartment in complete darkness with temperatures holding steady at about 99 degrees? Once the details of their survival began to emerge, it became clear how they survived – they worked as a team and focused on one common goal: survival.
Luis Urzua, the shift foreman (who, by the way, was the last to be rescued from the mine), immediately split the men into three teams who alternated shifts between sleeping, working and playing. Each shift lasted eight hours and included some form of group exercise so that the miners could remain thin enough to fit through the small capsule that would eventually bring them to the surface.
The group voted on everything including how and when to distribute and ration food and water and the decisions were usually unanimous; the men rarely argued because Luis kept the group focused on the goals while remaining in control throughout the entire ordeal using compassion and complete honesty later stating, “…whether good or bad, you have to speak the truth.”
Teams frequently fail for a variety of reasons including fear of conflict, lack of accountability, mistrust, and failure to monitor results and/or a lack of commitment. So how does one cultivate a teamwork environment when we are brought up to believe we should stand out as individuals? The answer is not easy, but with commitment to the value of teamwork, it is possible.
To create a culture of teamwork, these powerful actions must occur:
- Leadership must clearly communicate the expectations and face conflict directly. Conflict can be healthy, but employees tend to remain there if the conflict is completely ignored.
- Leaders must be direct and honest with those employees who choose to avoid accountability. Gaining buy-in from employees is an investment in motivation for employees to want to be part of a team.
- Employees who do not know the facts behind decisions or if they are not given appropriate timely information will be more likely to make up their own scenarios to fit situations; this is never good. The best defense against mistrust is to be honest and open with employees regarding changes – they will see the change happen anyway, so you might as well give them the real scoop.
- Leaders should also be able to admit mistakes and be vulnerable to the team first; once the employees realize that leaders are just like them, teamwork becomes easier.
- Leaders are responsible for putting the teamwork concept into motion and then constantly supporting the initiative. Once the leader can show they are intimate with the goals throughout the entire process, the team will be more cohesive.
- Much like the miners, employees must share the same goal and objectives. Employees who understand what they are doing and why they are doing it tend to be happier and more focused.
- Discuss the failures once they happen (without assigning blame). Discussing the issues surrounding failure allows teams to discuss prevention of a re-occurrence. The team can learn a lot from failure – do not be afraid to address it.
- The hardest step to take is identifying dysfunctions within the team – the process can be painful and often takes time (something we have little of). Once you have addressed and dealt with the dysfunctions, employees will begin to focus more on the goals and not on the unnecessary issues.
- Remember that the most frustrated employee is typically the one who cares the most but do not feel their opinions are valued. Instead of labeling this employee with a negative connotation, perhaps find out what is really going on – they usually want to help and will be excited by the opportunity and your interest.
- Leaders must encourage the use of the terms “we” and “our” versus “I” and “me.”
- Remember that no one works alone – ever. Even if we believe that we have single-handedly closed a sale, there are always a lot of people backing up the effort. Rewarding and recognizing these efforts create harmony within teams.
Managers can learn a lot from the leadership of Luis Urzua. He celebrated every small win with his team always aware that his actions and moods affected the other miners. Those that were in the mine with Luis knew that he had their back – they trusted him and were eager to follow his lead. It should also be noted that while Luis had all the power in this situation, he never used it to his advantage. He never received more than his share of food or water and took the same shifts as everyone else. The miners made particular note of this once they were released.
Although we will likely not find ourselves trapped in a mine, ask yourself one important question: how would you and your team handled the same situation? If the first thing you think about is a cynical retort, maybe it is time to start over.