South Carolina Immigrant Employee Law Takes Effect Next Month

South Carolina's new immigration law could make businesses such as Pleasant Places landscaping not so pleasant for workers in the country illegally or for the company itself.

About 90 percent of the Mount Pleasant-based landscaper's labor force is Hispanic, said Jason James, general manager.

Though many of the company's 150 or so workers are longtime employees who will not be affected by the new law, which only affects new hires, James emphasized it will have an immediate impact on his labor pool when it takes effect, starting Jan. 1.

"Sixty percent of all applicants will be denied (employment) instantly because they will be illegal," James said.

The new law, which the General Assembly passed earlier this year as the toughest in the nation, takes effect New Year's Day for public employers and government contractors with 500 or more employees.

The changes kick in for all other employers over the following 18 months.

Under the law, all employers must verify the legal status of new workers by requiring proof of either a South Carolina driver's license or an identification card or motor vehicle license from another state with the same eligibility requirements.

Companies also can use the U.S. Department of Homeland Security's online database, E-verify. It's free to enroll and use. The catch is that once a business or other employer signs up, it must use it for all new hires, said Lee Depret-Bixio, a labor and employment attorney with the Columbia office of Ogletree Deakins.

She explained nuances of the new law to business professionals in Charleston and across the state recently through a series of seminars set up separately by the National Federation of Independent Businesses and the state Department of Labor, Licensing and Regulation.

"It will have an impact on all employers," Depret-Bixio said.

A firing offense

For private businesses such as Pleasant Places, which does some public contracting with the S.C. State Ports Authority and has between 100 and 499 employees, the law starts July 1. For all other private businesses and public contractors with fewer than 100 workers, the law takes effect by July 1, 2010.

James estimates about 30 percent of those applying for work with his company now are turned down because of the counterfeit documents they present. Sometimes they present a fake Social Security card with 10 numbers. In other cases, the paperwork is easily flagged as fraudulent, he said.

But sometimes, illegal workers can sneak through the system.

"Some of the IDs are very convincing," he said.

James said his company tries to hire U.S. citizens whenever possible. But it has found that Hispanics overall have a good work ethic, filling the employment gap left by Americans who either don't want the labor-intensive jobs or have trouble passing drug tests or criminal background checks.

The new law will be enforced through random auditing by Department of Labor, Licensing and Regulation, said Jim Knight, the agency's director of communications.

Penalties for knowingly hiring workers who are in the country illegally range up to $1,000. And a business can lose its right to operate for 10 to 30 days for the first offense and for at least five years by the fourth offense.

Businesses that do not properly verify a worker's legal status can be fined between $100 and $1,000 per illegal worker. They have 72 hours to correct any mistakes and check the worker's legal status to avoid a fine.

In all cases, illegal workers must be fired immediately.

Collision course?

Depret-Bixio said the E-verify system reduces Social Security number mismatches and provides a backstop for employers by showing they did everything they could to comply with the law.

But it is not infallible. The system has a small percentage error rate and cannot detect identity theft.

Also, some businesses are reluctant to use it because it requires that they give the federal government access to their records.

Most of the mismatches found using the E-verify system result from human error, such as manual data-processing mistakes, said Yasser M. Benadada, a management and program analyst with the U.S. Department of Homeland Security's U.S. Citizenship and Immigration Services in Washington.

Of those employers who already use the E-verify system — it had 3 million queries in 2007 and 6 million are expected this year — about 94 percent of the queries were instantly verified, Benadada said. Less than one-half of 1 percent of mismatches are the result of errors in the database. The others are linked to human error that can be easily corrected.

Knight said the law is not perfect and believes lawmakers will revisit it to fill some unanswered questions such as a business's right to keep operating while it contests a purported serious violation. Legislators also allocated no money for field auditors, he said.

Lawmakers passed the law after Congress failed to adopt a federal immigration measure to get a handle on the nation's growing immigrant population, Knight said.

They also acted over concerns that legal workers were being displaced by lower-wage-earning illegal immigrants, as well as worries of the increased costs of public services, including schools, health care and law enforcement, linked to undocumented employees.

Though no one has challenged the new South Carolina law in court, other states that have adopted illegal immigrant legislation have come under fire for encroaching on the federal government's turf.

In June, a federal judge granted a preliminary injunction barring Oklahoma's law from taking effect last July 1 after the law was challenged by the U.S. Chamber of Commerce and pro-business groups. The decision is on appeal.

On the other hand, Arizona's law, which became the nation's first when it took effect last Jan. 1, was recently upheld by a federal appeals court.

Unless Congress adopts new legislation in the interim, Depret-Bixio predicts both cases could collide at the U.S. Supreme Court.