Illegal workers question

[milee]

There may be penalties depending on how/when the illegals were discovered.

Were these workers paid through normal payroll method or paid cash?

[zibazinski]

Since nothing will be done because of our govt to those who employ illegals, I'd let it go. What's the point?

[milee]

If they were paid on payroll, the company is paying for unemployment insurance, worker's comp, etc. So, no, the company wasn't avoiding those particular costs. But it is reasonable to assume that having more competition does keep wages down.

[taz157]

Depending on the state and their unemployment rules, they may not have worked long enough to actually get unemployment.

[milee]

Sept 18, 2012 19:28:24 GMT -5 @bloomscuzzer said:

Sept 18, 2012 19:18:09 GMT -5 milee said:

If they were paid on payroll, the company is paying for unemployment insurance, worker's comp, etc. So, no, the company wasn't avoiding those particular costs. But it is reasonable to assume that having more competition does keep wages down.

I thought if the company laid off a lot of people and those people collect unemployment the insurance premium goes up for the company. If the company fires people because they are illegal workers, the workers cannot collect unemployment. Thus the premium does not go up.

Is that incorrect?

No, you're correct but there's more to it. Unemployment rates have a maximum limit and given what you've posted about your company, there's a good chance the company's rates are already at the max rate limit regardless of what happens with these particular employees. So whether these employees end up claiming/being eligible or not probably has little bearing on the company's future rates.

[Bluerobin]

Call ICE whenever you are aware of illegals. Maybe they will do their jobs and deport them.

[michelyn8]

Sept 18, 2012 19:44:56 GMT -5 milee said:

Sept 18, 2012 19:28:24 GMT -5 @bloomscuzzer said:

I thought if the company laid off a lot of people and those people collect unemployment the insurance premium goes up for the company. If the company fires people because they are illegal workers, the workers cannot collect unemployment. Thus the premium does not go up.

Is that incorrect?

No, you're correct but there's more to it. Unemployment rates have a maximum limit and given what you've posted about your company, there's a good chance the company's rates are already at the max rate limit regardless of what happens with these particular employees. So whether these employees end up claiming/being eligible or not probably has little bearing on the company's future rates.

I don't know how reporting is done in other states but I'm in VA and when I was doing the reporting on a previous job, I had to report the name, social security number (valid or not) and wages of everyone employed during a given quarter. Then our tax for that quarter was calculated based on wages paid out x our rate for that year. There was some adjustment for the first $x paid but I don't remember the amount or how that worked.

So even if those worker's were illegal and ineligible for unemployment benefits, your company still paid into the system for wages paid to them. What affects a company's unemployment tax rate is the number of claims paid out for dishcharged employees in a given time frame set by the state.

[Deleted]

So, are illegals filing tax returns too?

[happyhoix]

"Today they got rid of 34 illegal workers."

I'm curious, did you think there are other workers there who are also illegal but who did NOT get terminated, because they are still needed on the job?

Companies are required to check green cards and immigration status BEFORE they hire people, so it seems strange these guys worked for a while before that information turned up, and then it turned up all at once for 34 people...

[milee]

Sept 19, 2012 7:08:16 GMT -5 happyhoix said:

"Today they got rid of 34 illegal workers."

I'm curious, did you think there are other workers there who are also illegal but who did NOT get terminated, because they are still needed on the job?

Companies are required to check green cards and immigration status BEFORE they hire people, so it seems strange these guys worked for a while before that information turned up, and then it turned up all at once for 34 people...

Maybe strange, maybe not. There's no univeral and good system for verifying SSNs, so there are many ways employers find out that there's a problem.

For example in AZ, there was a big controversy because the state made it a law that all employers use the Social Security Administration's electronic verification system. Although that sounds like a very reasonable requirement, the e-verify system is known to be riddled with errors. When AZ first proposed this law, there were statistics out there that indicated 20% - 25% of the data in the e-verify system was incorrect. We experienced this in our business. One person who later turned out to be illegal passed e-verify with no issues and another guy who had been born in AZ and who we'd known him and his family for 15 years so knew this to be true didn't pass e-verify. So e-verify isn't a terribly accurate way to check, but it's really all that's currently available.

Other employers find out when they're doing their quarterly unemployment reporting. The quarterly reporting to most states requires input of SSN information and sometimes a month or so after the submission of a quarterly report, the state will reply that there's a problem with an SSN.

Other employers find out when they're doing their annual W3/W2 reporting to the Federal government. If an employer does that electronically, the system will kick out "problem" SSNs. Again, though, just like with e-verify, the system has a fair bit of garbage data, so it's not very accurate.

As an employer, if an employee presents you with documents (SS card and driver's license for example) that look valid, there are no really good ways to verify if there's a problem.

[michelyn8]

Sept 19, 2012 9:06:45 GMT -5 @bloomscuzzer said:

It just seems like an unlikely coincidence, the company needing to get rid of a lot of employees, the same time they find out a lot of the employees are illegal.

Why would a company contest someone who claims they were laid off instead of quit, if there is no money saved by doing it? It wastes time for the company to contest if there isn't some kind of benefit.

The benefit is that when the company's rate is reviewed for adjustment at the end of the year, they can be given a lower rate because of fewer payouts versus a higher one.

That adjustment is one reason why our client did away with the unpaid furloughs they instituted in 2009 to cut costs. It all looked good on paper but then some of the employees discovered they could apply for and receive UI. What they were going to save in salaries ended up costing them in the form of a higher UI rate because of those claims.

[milee]

Sept 19, 2012 9:16:30 GMT -5 @bloomscuzzer said:

Sept 19, 2012 9:12:55 GMT -5 michelyn8 said:

The benefit is that when the company's rate is reviewed for adjustment at the end of the year, they can be given a lower rate because of fewer payouts versus a higher one.

That adjustment is one reason why our client did away with the unpaid furloughs they instituted in 2009 to cut costs. It all looked good on paper but then some of the employees discovered they could apply for and receive UI. What they were going to
save in salaries ended up costing them in the form of a higher UI rate because of those claims.

That's what I thought, but Milee said probably no. I have had my unemployment contested a couple times. So think there is a monetary reason to do so.

I don't know. You may be right. Employers do fight claims to keep their experience ratings low. I guess in this case, you'd need to know 1) if the employer was fighting UI claims to keep ratings low or because they wanted to burn certain employees and 2) if your employer understands the system well enough to know when it's worth fighting and when it's not.

Of my prior clients, I'd say less than 10% understood the system enough to make a good decision about when to fight. Any idea how savvy your employer is?

[sheilaincali]

I don't know if this is true on not- this is just the opinion of Stuart- one of our customers.

He claims that the government is not willing to crack down on illegals using falsified identification because they make millions off of it. He said that a person could go to Mexico, hook himself up with a shady lawyer down there and sell his identification to hundreds of people. That person could then take that money he just made and retire somewhere tropical. The hundreds of illegals, no in possession of a valid American identification could come to the US and "legally" work. The government is able to now collect the social security, medicare, child support etc from hundreds of workers instead of the one original worker.
By cracking down on illegals using purchased identification the government would lose millions every year on the duplicate social security and medicare and taxes it collects.

Stuart claims he knows this to be true because he had an employee that checked out when he reported him as a new hire but the guy was pissed when he got his paycheck and their was child support taken out. He claimed he had no children. Stuart said that the order had come in and that he had to pay it but he could contest it. The worker's buddy overheard this and smacked his friend upside the back of his head and said "You idiot- you used the wrong id card"

In Minnesota I have to report every new hire to the state. There is a simple website I go to. It asks for their name, DOB, SSN, and address.

[swamp]

I think Stuart wears a tin foil hat.

Illegals alien labor keeps food prices down.

[sheilaincali]

Swamp- I don't disagree with you. The only people stranger than the employees here are the customers!

[milee]

Stuart is wearing a tin foil hat, but he is partly correct. Illegals do pay millions in social security, medicare, federal, etc taxes. They also cost millions in social services. Different studies have tried to quantify the net impact with varying results. Some studies seem to indicate that the amounts paid in to the government by illegals exceed the amount of services they use. Other studies indicate the amount of services consumed is greater than what is paid. Tough to know since by definition this is a population that is not recorded.

The part where Stuart's assertion falls apart is that it's now pretty tough to get legit IDs. So the illegals can purchase valid social security numbers and associated identifier data, but it's not so simple to get the associated "valid" driver's license or passport. Very unlikely to have several hundred illegals with "valid" documents they bought. You can get fakes, but the quality varies widely.