Companies have typically, and wisely, been advised to stay clear of politics. For every customer whose views you might validate with even a hint of activism, there are those who are likely to hold a grudge.

The exception to that rule may be the current immigration debate, which is forcing firms to take sides whether it suits their needs or not.

The year began with U.S. Immigration and Customs Enforcement raids targeting 7-Eleven stores nationwide. The ICE raids were a shot across the bow for companies suspected of hiring “illegal aliens” and a warning to undocumented workers.

The raids, from a compliance perspective, also emphasized the need for that function to build a closer relationship with human resources personnel, and to maintain close attention to employee documentation. It is all part of the new normal of the Trump administration.

Defending ‘Dreamers’

A few weeks prior, in September 2017, companies also faced what remains an ongoing immigration issue. Business leaders across the nation stepped up to vigorously protest the apparent end of a federal program that granted amnesty to a class of immigrants known as “Dreamers.”

On Sept. 5, President Trump, through Attorney General Jeff Sessions, announced the termination of the Deferred Action for Childhood Arrivals program, better known as DACA. The program, created in a 2012 executive order by President Barack Obama, protected the children of illegal immigrants from deportation and allowed them to hold jobs in the United States without the fear of immigration enforcement.

The U.S. Chamber of Commerce was among the business groups that protested the apparent demise of the DACA program. Nearly 400 company executives also urged the Trump administration and Congress to maintain DACA. Among the signatories were CEOs of Adobe Systems, Airbnb, Amazon, Ancestry.com, Apple, AT&T, Best Buy, Cisco Systems, Dropbox, eBay, Etsy, Exelon, Gap, General Motors, Google, Hewlett-Packard Enterprise, Hilton, IKEA, Intuit, Levi Strauss & Co., Marriott International, Netflix, Pandora, PayPal, Salesforce, Snap, Starbucks, Twitter, Uber, Univision, Viacom, Visa, Wells Fargo, and Western Union.

“At least 72 percent of the top 25 Fortune 500 companies count DACA recipients among their employees,” they wrote. “Our economy would lose $460.3 billion from the national GDP. … Dreamers are vital to the future of our companies and our economy. With them, we grow and create jobs. They are part of why we will continue to have a global competitive advantage.”

Despite an increased focus on immigration by the Trump administration, much of the amplified scrutiny began during the Obama administration, which targeted the business world through ICE-led worksite enforcement investigations and compliance audits.

That focus, and resulting fines, are often the result of Form I-9 audits. Immigration officials use them for verifying work authorization and as the basis for whether to perform a compliance audit.

Upon receiving a Notice of Inspection, a company has just three days to turn over all Form I-9s, an especially daunting task for large employers. ICE often looks to supplement its investigation with additional demands for tax and payroll records. The challenge for companies is twofold: collecting the demanded data quickly and making sure the files are as complete and error-free as possible.

The financial cost

Those fines can be substantial. Penalties can run as high as $1,100 per violation for each faulty I-9 (even mundane errors like misspellings could result in a faulty form).

“Companies want certainty more than anything. The vast majority of employers want to comply with the law and the continuous reversals of federal workplace policy … Uncertainty means inability to plan, budget, and anticipate, and it requires constantly retraining employees and reformulating employment policies.”
Michael Lotito, Co-Chair, Littler’s Workplace Policy Institute

In 2013, Infosys Limited—an Indian company involved in consulting, technology, and outsourcing—agreed to a record $34 million civil settlement based on allegations of systemic visa fraud. It also agreed to enhanced corporate compliance measures. It was, and remains, the largest payment ever levied in an immigration case.

Infosys, ICE said at the time, brought foreign nationals into the United States to work under two visa classification programs, H-1B and B-1.

The H-1B visa allows employers to temporarily employ foreign nationals needed for certain specialty occupations. H-1B visas are limited by Congress and President Trump has threatened to curtail their use even more.

There is no such limit to B-1 visitors, a program that only allows foreign nationals to temporarily enter the country, for conferences and seminars. B-1 visa holders are not allowed to work in the United States. Infosys, however, “unlawfully and fraudulently used B-1 visa visitors as though they were H-1B workers in violation of U.S. immigration law,” ICE said.

Infosys went so far as to create a memo for foreign nationals entering the United States on a B-1 visa that included directions like: “Do not mention activities like implementation, design and testing, or consulting which sound like work”; and “do not use words like, work, or activity, in the invitation letter.”

Uncertainty fuels distress

A recent survey by Littler, a global employment and labor law practice representing management, finds that current uncertainty and instability of immigration laws is flummoxing many companies. The seventh annual survey of more than 1,100 employers reveals how companies are responding to rapid social and political changes.

“Companies want certainty more than anything,” Michael Lotito, co-chair of Littler’s Workplace Policy Institute, said of the current mélange of regulations and guidance affecting companies. “The vast majority of employers want to comply with the law and the continuous reversals of federal workplace policy … Uncertainty means inability to plan, budget, and anticipate, and it requires constantly retraining employees and reformulating employment policies.” 

Of the changes that occurred during the first year of the Trump administration, respondents identified the rollback of wage-and-hour policies (62 percent) and the new tax bill (62 percent) as the areas that have most significantly impacted their businesses.

As for tightening regulation and enforcement of both legal and illegal immigration, employers said they expect a range of immigration-related changes to significantly impact their workplaces in the coming months. 

Tighter restrictions on visa adjudications, such as those for employees with specialized skills and temporary workers, was the top concern selected by 48 percent of respondents. More than a third expressed concern with increased workplace immigration enforcement by ICE and associated agencies.

“It’s not surprising that the visa process and immigration enforcement emerged as employers’ top concerns,” said Jorge Lopez, chair of Littler's Global Mobility and Immigration Practice Group. “The increased scrutiny being applied to employment visas and rule changes impacting visa programs, which often come mid-stream and without warning, make it difficult for employers to plan ahead and manage their workforces.”

Changes to existing immigration enforcement policies hurt both those who need manual labor and high paying positions in the tech and pharmaceutical sectors.

Some of the high-tech woes, Lopez said, have nothing to do with undocumented workers. They involve a once lawful workforce brought to the United States to usher in corporate expansions. “It is really the companies that are coming in, setting up operations, and bringing in key employees to help as those businesses expand,” he said. “Then, they will look to do domestic hires, so it’s a win-win for the U.S. economy, but these companies are seeing more intense and restrictive adjudication standards. This is not a change in law per se, because that has to be enacted by Congress, but there has been a lot of more restrictive implementation in policy by government agencies with guidance memos and the implementation of existing law.”

“There is talk now of expansion and development in countries other than the U.S.,” Lopez says. “It is less a government-sponsored reaction than it is a corporate analysis of what they think is probably going to be best for them in the long term.”

Uncertainty, he said, has taken a toll.

“You’ll go from day-to-day, week-to-week where preexisting policy memorandums that have been in place for years are suddenly abandoned, and applications that are in mid-stream are now affected by new rules,” Lopez says. “It is hard to manage when you don’t know what the rules are. That uncertainty, and being unable to understand where things are going, is causing a lot of concern.”

Lopez also noted that “the increase in worksite enforcement and raids have naturally heightened employers’ focus on worksite compliance issues and properly addressing those concerns.”

Revolt and reputation

In recent days, a mix of low employee morale and reputation risk has come to a boil amid the Trump administration’s “zero tolerance” policy for immigrants apprehended crossing the border. The policy has been a catalyst for angry protests over the incarceration of nearly 2,000 children, separated from their parents and kept in makeshift detention camps.

Any corporate association with ICE or other agencies has sparked internal mutiny.

At Microsoft, roughly 300 employees protested a $19.4 million contract with ICE for the use of its Azure Government cloud-based database tools. They demanded that CEO Satya Nadella end the association.

Microsoft’s contract with ICE, the letter says, is “a clear abdication of ethical responsibility.”

“Microsoft went as far as boasting that its services ‘support core agency functions’ and enable ICE agents to ‘process data on edge devices’ and ‘utilize deep learning capabilities to accelerate facial recognition and identification.’ These are powerful capabilities, in the hands of an agency that has shown repeated willingness to enact inhumane and cruel policies,” it adds.

In a response, the company touted its commitment to diversity and continued support of its Kids in Need of Defense initiative, which provides pro bono legal support for “unaccompanied children, many of whom are fleeing some of the most dangerous countries in the world.”

“Microsoft is not working with the U.S. government on any projects related to separating children from their families at the border,” Nadella wrote, defending the government contract. “Our current cloud engagement with ICE is supporting legacy mail, calendar, messaging and document management workloads.”

A similar employee-led protest hit CRM-software company Salesforce for its contract with U.S. Customs and Border Patrol.

“We cannot cede responsibility for the use of the technology we create, particularly when we have reason to believe that it is being used to aid practices so irreconcilable to our values,” a distressed group of employees wrote. “Those values often feel abstract, and it is easier to uphold them when they are not being tested. They are being tested now.”

Topics