Immigration Law Advisory - ICE Proposes Debarment of Seven Companies from Federal Contracting for Knowingly Hiring Unauthorized Workers

On September 12, 2008, the United States Immigration and Customs Enforcement (ICE) announced that it had notified seven companies that were previously found to have knowingly employed illegal aliens that they were being considered for debarment from federal contracting.

The Federal Acquisition Regulations allow the debarment of contractors that have been found to have knowingly hired unauthorized workers or to continue to employ an alien who is or becomes unauthorized to work in the United States.  However, this is the first time that the ICE has actually initiated debarment proceedings on immigration grounds.  A senior Department of Homeland Security official stated in the news release announcing the debarment proceedings that “[b]y using debarment in appropriate circumstances, the federal government can avoid working with businesses that employ an illegal workforce and unscrupulously undercut their competitors to gain an unfair market advantage because of reduced labor costs.”

The seven companies are located in six states—Kentucky, Maine, Maryland, Missouri, New York, and Virginia and conduct business in the areas of construction, home improvement, landscaping, janitorial services, and food purveying.  Upon the initiation of the debarment proceedings against the seven companies, each company's name has been entered into the Excluded Parties List System (EPLS), a web-based system that identifies parties suspended, debarred, proposed for debarment or otherwise excluded from receiving federal contracts, certain subcontracts, and certain types of federal financial and non-financial assistance and benefits.  The seven companies are immediately prohibited from competing for new government contracts.  The proposed debarment and immediate suspension apply government-wide.  Neither ICE, nor any other federal agency, may award a new contract while these companies are on the EPLS. 

The seven companies have 30 days to challenge the decision.  At the end of the 30 days, ICE will make a final determination about debarment and, if debarment is recommended, the length of the debarment. 

This debarment action by ICE, along with the recent high-profile immigration raids, highlights heightened enforcement efforts by the federal government against the practice of hiring unauthorized immigrants.  It is recommended that employers, particularly those that tend to hire a great number of immigrant workers, take a proactive approach and conduct regular reviews of their employees’ immigration records to ensure compliance with the immigration law.

If you have questions about the information in this alert, please contact Lynda S. Zengerle at 202.429.8170, or Aleta Turner Okediji at 202.862.5733.