Immigration continues to be a hot-button topic of debate and will likely continue to be throughout the 2012 campaign season. Although there are myriad issues related to immigration facing small business, one of the most potentially harmful is the push to mandate E-Verify.
Those in favor of mandated E-Verify would require all employers to use the Department of Homeland Security’s (DHS) E-Verify program to verify all employees. One such proposal, the Legal Workforce Act (H.R. 2885), gained some traction earlier in the year, but fortunately lost steam once lawmakers began to truly understand the hardships such a mandate would impose on America’s small businesses.
This legislation would give small businesses just 12 to 24 months to begin using the E-Verify system to determine that their employees are legal. It has been estimated that businesses with fewer than 500 workers would bear the greatest burden of E-verify, spending about $2.6 billion a year, compared with less than $100 million for the four percent that used it in 2010.
Both the Government Accountability Office and Westat, a Rockville-based research firm under contract to the U.S. Citizenship and Immigration Services (USCIS) — part of DHS — have found that the system continues to be highly inaccurate. More unauthorized workers are deemed authorized by the system (3.3 percent of all E-verify cases) than are found unauthorized to work (2.9 percent of all E-verify cases).
USCIS and the Social Security Administration estimate that about 60 million queries would be generated annually under E-Verify if the program were made mandatory for new hires nationwide. In 2008, only about 6.6 million queries were run through E-Verify.
On average, 0.7 percent of authorized workers are found unauthorized initially, or a “tentative non-confirmation.” There are four to five million new hires in the U.S. per month. That means that E-verify will deny employment opportunities for about 28,000 to 35,000 Americans per month or as much as 420,000 annually. Furthermore, USCIS estimates that 164,000 people will be given a tentative non-confirmation for name-related reasons alone.
Those authorized, perfectly legal workers will then be forced — along with their employers — to navigate a bureaucratic morass. It currently takes several months, on average, to resolve database mistakes, leaving both the employer and employee in legal and business limbo. The employer is forced to pay the employee although there is a high chance that he or she will eventually be deemed unauthorized. If E-Verify is required for all new hires, the system will be swamped with 10 times more queries which will only lead to vastly longer times to resolve errors than it currently does.
The immigration debate is a broad one, impacting nearly every person in the U.S. What we need is a thoughtful debate on issues such as employee verification and the appropriate numbers of U.S. guest-worker visas for both high-tech and seasonal workers. Not policies that prevent legal workers from a job or exacerbate the already disproportionate regulatory burden facing small business.
And, as always seems to be the case, even the most well-intentioned policy must take into account the impact it will have on the U.S. economy, and specifically on small business. We can ill afford any law or regulation now that stymies economic growth or hampers employers’ ability to provide jobs.
Todd McCracken is president and CEO of the Washington-based National Small Business Association (NSBA), the nation’s oldest small-business advocacy group which operates on a nonpartisan basis.