Summer 2009: DHS, Legislation, and Case Law Update

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Department of Homeland Security (DHS):

Three significant actions were recently announced.
ICE Enforcement – U.S. Immigration and Customs Enforcement (ICE) issued Notices of Inspection (NOI) to 652 businesses as it began a new audit initiative aimed at holding employers accountable for their hiring practices and efforts to ensure a legal workforce. Those given notices will be subject to a review of their I-9 records to determine whether these employers are complying with employment verification laws and regulations. Employers are advised to review their I-9s for compliance. DHS has indicated that it is focusing on those businesses suspected of knowingly hiring aliens, such as in cases in which the employer assists illegal employees in obtaining documents. It is imperative for all employers to ensure that I-9 forms are completed for all employees and meet all requirements.

“No Match” Letters – DHS has rescinded the most recent regulation on this subject. While this appears to be good news, the question still remains as to the appropriate actions to take when these letters are received. Although Social Security has not recently issued any of these letters (while the regulation was pending) employers should consult with counsel in order to advise employees that such a letter was received but refrain from action that could constitute discrimination.

E-Verify (federal government contractors) – This DHS rule will require federal government contractors to utilize the E-Verify system for all new hires and all employees (including current employees) who perform contract work. Although this rule has been delayed a number of times it is now effective as of September 8, 2009.

New Federal Minimum Wage
The federal minimum wage increased from $6.55 an hour to $7.25 an hour effective July 24, 2009. Of course, for employees in California the minimum wage continues to be significantly higher at $8.00 an hour.

Pending Federal Legislation
Employee Free Choice Act (EFCA) – In the version of this legislation passed by the House, recognition of a union under the National Labor Relations Act (NLRA) is mandated as a result of cards signed by the employees – without an election as the law currently requires. There is a possibility that this will be modified to allow for an expedited election (within 5 to 10 days following a petition; as compared to the current 6 to 8 weeks). However, for this “concession” labor backers also want equal access to the company property for union organizers and a ban on employer-scheduled mandatory employee meetings. Importantly even a revised version of the bill continues to require mandatory arbitration to impose a collective bargaining agreement if the parties are unable to agree. Significantly increased damage awards and fines are also included. Although other federal issues are currently making the headlines (e.g., health care reform) this legislation continues to push forward. Employers are advised to take appropriate measures to maintain a union-free environment.

Federal Oversight, Reform, and Enforcement of the WARN Act (“ForeWARN Act”)
Under current federal law, employers with 100 or more employees are required to give employees 60 days’ notice of a plant closing or mass layoff. This bill would require employers with 75 or more employees to provide 90 days’ notice The number of affected employees to trigger obligations under the Act have also been reduced to 25 (down from 50 for a “plant closing”; and 1/3 of the workforce [at least 50] or 500 employees for a “mass layoff.”) California employers are also subject to the California WARN Act if the employer has 75 or more employees.

This case in which the Supreme Court determined that the City of New Haven engaged in reverse discrimination against whites and Hispanics in favor of African-American applicants for promotion received more attention that usual because Judge Sonia Sotomayor (nominated for the Supreme Court) was a judge on the panel which had found the City’s actions legal. The City had thrown out the results of test because of its concern that African-Americans would claim disparate impact discrimination. The Supreme Court found that an employer can engage in intentional discrimination (reverse discrimination) but only in those circumstances in which it is determined that there would be a disparate impact. Without a “strong basis in evidence” such discrimination violates Title VII. Thus, it is important for employers to thoroughly review potentially discriminatory actions before deciding they are necessary to avoid disparate impact on a protected group.

For assistance with I-9 audits, “no match” letters, E-Verify or other issues discussed in this Advisory, contact Jeanne Flaherty or Lynn Ryder at Employer’s Legal Advisor, Inc.

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