ICE has major beef with Michigan dairy farm: owners sentenced to three years of probation and ordered to pay nearly $3 million in penalties

Yesterday, Immigration and Customs Enforcement (ICE) announced that the owners of a Michigan dairy farm had been sentenced to three years of probation and ordered to pay nearly $3 million in penalties for hiring and harboring unauthorized workers.

As described below, this case represents the other end of the I-9 spectrum, where ICE will vigorously pursue employers who knowingly hire unauthorized workers or engage in other crimes that facilitate such actions (human trafficking, alien smuggling, document fraud, abuse/exploitation, etc.) As we’ll see below, the fines and penalties can be quite severe. If you’re thinking this could never happen to your organization – it’s important to remember that I-9 compliance and verification failures are an extremely slippery slope, and that a missed I-9 today could easily turn into something a lot worse tomorrow. Let’s take a quick look at the dairy case.

The Investigation

According to court records, Aquila Farms, LLC, employed 78 different unauthorized workers from January 2000 to October 2007 (which constituted roughly 75% of its workforce over that time period). Federal prosecutors explained in court documents that the owners failed to fully and accurately complete I-9 forms for new hires of the dairy farm, which immediately led ICE to dig even further into their hiring practices (this, by the way, is where you do NOT want to be).

During the investigation, ICE learned that of the 78 unauthorized workers hired by the owners, some were hired on multiple occasions using different names or social security numbers despite the fact that they had been notified by the Social Security Administration that its employees were not in fact authorized to work in the United States. Moreover, the prosecutors alleged that the owners actually encouraged or “induced” the workers to reside in the United States by providing them with employment and free housing on the farm, away from scrutiny by immigration authorities and the surrounding community.

The Settlement and Penalties

As part of the agreement reached with the government, the owners pleaded guilty to hiring unauthorized workers, a charge that carried a $3,000 fine per hire (what ICE refers to as a “meaningful civil penalty). When you take $3,000 x 78 employees, the total fine was set at $234,000. The couple was also sentenced to 3 years of probation. Then, the company itself was sentenced to probation for five years and ordered to pay a fine of $500,000 and required to make payments totaling $2,000,000 in lieu of forfeiture (designed to punish those employers who profit from using unauthorized workers). All told, the damage was assessed at $2,734,000.

Lessons Learned

As many of our guest bloggers have described in the past, the best defense against a possible ICE investigation (whether it be merely paperwork violations or something more severe) is to proactively develop a comprehensive compliance program which attacks any potential weaknesses. Although there is no “one size fits all” policy, the following steps are generally considered best practices in the industry:

  1. Contact experienced immigration counsel to guide you through a detailed self-audits of all of your I-9s. Develop a remediation plan to correct errors as quickly as possible. For a list of some of the best ‘in the know’ immigration counsel specializing in I-9 compliance, please see our list of guest attorney bloggers here.
  2. Provide continual I-9 training for all those employees who are charged with ensuring the proper completion of the form.
  3. Draft and implement consistent and uniform Form I-9 processes and procedures to ensure compliance throughout your organization and defend against potential discrimination claims for employees who feel that they have been treated differently.
  4. Develop a process for dealing with tricky I-9 issues (e.g., the dreaded “No-Match” letters).
  5. Adopt a comprehensive and trusted electronic I-9 and E-Verify solution, which has been designed with compliance in mind from the ground up. Ensure the system has been vetted by immigration counsel and meets the most conservative interpretation of the regulations – especially in light of recent statements by ICE.
  6. Retain outside counsel for ongoing advice when there are lingering I-9 or E-Verify questions. This blog and the stories within are proof that I-9 compliance is anything but easy and straight-forward!