Federal officials recently announced the largest settlement ever in a work site enforcement case. IFCO Systems North America, the largest pallet management services company in the country, agreed to pay $20.7 million in fines and back pay to resolve a three-year criminal investigation relating to the hiring of more than 1,000 undocumented workers. John P. Torres, the acting assistant secretary of homeland security for Immigration and Customs Enforcement (ICE), said it would “send a powerful message that ICE will investigate and bring to justice companies which hire illegal workers.”
According to an ICE press release, IFCO employees “failed to take significant measures to verify the social security numbers of . . . workers, and . . . failed to make any effort to address the use of invalid social security numbers by numerous . . . employees.” ICE also stated that IFCO had agreed to implement a “precedent-setting, compliance and reporting program, designed to prevent the employment of illegal aliens at IFCO plants in the future.” IFCO remains bound by the agreement until 2012, at which time the government would not seek prosecution provided that IFCO was in full compliance with all terms of its settlement agreement. The government had previously charged twelve IFCO managers with criminal offenses. Nine pled guilty, while three face trial.
The agreement comes at a time in which the rate of immigration prosecutions continues to rise sharply. According to recently released data, federal prosecution of immigration cases nearly doubled in 2008, as the year saw more than 70,000 immigration cases. Meanwhile, federal prosecutions of other crimes have remained steady or declined in recent years – e.g. weapons, organized crime, etc..
The IFCO settlement and the sharp rise in immigration prosecutions serve as reminders of the need for companies to implement formal immigration law compliance mechanisms, and to address any potential problems before they expose companies and their employees to criminal liability.