New immigration law impacts local businesses

Any business owner with over 25 employees now has three days to electronically verify new hires or face stiff penalties for violating a new law.

Proponents of the new legislation believe it will curb undocumented immigration. Opponents say it adds extraneous and often confusing red tape for business owners, will acerbate a workforce shortage in several industries, and unfairly affects mixed-status families – where a spouse or child is the lone U.S. citizen.

The law took effect July 1 and also requires hospitals that accept Medicaid to verify patients’ immigration status and report health care costs for undocumented people. In addition, it is now illegal for non-citizens to use another state-issued driver’s license or receive a Florida ID card, and even family members would commit a felony for “knowingly and willingly” transporting an undocumented person into the state.

A webinar hosted by the St. Petersburg Area Chamber of Commerce Wednesday focused on how Senate Bill 1718 would affect businesses. Andrew McLaughlin, a local labor attorney with Stearns Weaver Miller, led the presentation.

“This is a really good opportunity for many employers to look at their overall immigration and E-Verify practices, and I-9 practices, and fix any common errors they may have,” McLaughlin said. “Because of the Florida law, there are enhanced penalties if you’re doing other things wrong.

“It could get very expensive, very quickly.”

Those impacted the most

The Florida Policy Institute (FPI) states that the new legislation would most impact the construction, hospitality, retail and agriculture industries. Those and related sectors employ nearly 400,000 undocumented workers, 10% of the workforce.

The organization adds that undocumented workers earned $12.6 billion in 2019 before the pandemic created data collection challenges. Those employees also spent about $923 million, or 7.3% of their income, paying local and state taxes.

Employers across all industries must immediately navigate the changing landscape. Owners with over 25 employees, and companies of any size contracting with local state governments, must complete the I-9 verification form and the E-Verify system.

McLaughlin said the electronic process “creates a presumption of compliance” and that “it may be advisable” for employers in high-risk industries to use E-Verify, even if they employ less than 25 people.

Owners who fail to use the system could incur $1,000 daily fines per worker and lose any related licenses if they employ undocumented people. McLaughlin said state officials are also increasing monitoring efforts.

The FPI notes that the Florida Department of Economic Opportunity (DEO) – which administers the penalties – lacks a robust enforcement division. The report states that the taxpayer-funded agency will incur significant costs, and it can assess reimbursement penalties.

In addition, any worker who uses false documentation during the hiring process is subject to a third-degree felony and a $5,000 fine or five years in prison. McLaughlin explained that employers do not need to recertify employees with expiring driver’s licenses or ID cards, but would need to revisit the process for temporary work authorizations.

Implementation challenges

Navigating the new state law while complying with federal regulations is another challenge. McLaughlin said that if a new hire presents what appears to be valid documents, and the E-Verify system issues a “tentative non-confirmation,” employers must still let them work.

Andrew McLaughlin, a local labor attorney with Stearns Weaver Miller.

He said employees have a 10-day appeal period, and terminating them beforehand violates federal statutes and could result in litigation. McLaughlin also issued a stern warning for business owners who have previously forgone the E-Verify process or have hired people since July 1 and think retroactively verifying those workers will offer legal protection.

“A lot of employers are going to think, ‘well, I need to go back and reverify everything because that will make me extra safe,’” McLaughlin added. “And that’s not the case. That’s actually creating more problems because now you’re violating federal law, and you may not have any additional protection under Florida law.”

In addition, the FPI states that errors in E-Verify databases may incorrectly reject a U.S. citizen or someone legally authorized to work. Its report notes that the system is over 27 times more likely to flag a documented immigrant.

Another complication is that employers must offer employment and complete the I-9 verification form before starting the electronic process. The FPI notes that “as a result, companies will hire workers, put them through E-Verify and then be forced to fire them rapidly.”

An accompanying Chamber document highlights how companies in other states have sidestepped similar laws by reorganizing into sub-groups with less than 25 workers. It also states that 49.5% of Alabama workers missed work to correct “tentative mismatch” errors when state officials mandated the E-Verify system in 2011.