U.S. to require checks Contracts tied to worker eligibility

Bertrand M. Gutierrez

Jun. 15, 2008 (McClatchy-Tribune Regional News delivered by Newstex) -- Federal agencies spent nearly $300 million on goods and services over the past five years -- everything from trucks to office furniture -- in the 5th Congressional District, which covers most of Winston-Salem and Northwest North Carolina.

Wake Forest University got $66 million in federal contracts, mostly for medical research contracted by the U.S. Department of Health and Human Services, according to USAspending.gov, which tracks federal contracts listed by the Federal Procurement Data System.

Winston-Salem Industries for the Blind Inc. got nearly $40 million during the same period.

And HiPerf Inc., a small business in Kernersville, has obtained $6.6 million in federal contracts since 2004 to provide consulting services to the U.S. Department of Homeland Security, the data show.

But a new wrinkle could affect the flow of money, and it turns on the issue of illegal immigration.

President Bush issued an executive order this month that would require federal contractors, including HiPerf, Industries for the Blind and Wake Forest, to use an online system picked by the U.S. Department of Homeland Security to verify the employment eligibility of workers.

The system is called E-Verify, a free online tool that has raised concerns among business and civil-rights groups.

Homeland Security officials already require federal agencies to use E-Verify, but the government had stopped short of requiring private businesses and organizations to use the system as well. That changed with the executive order, which was announced Monday.

"A large part of our success in enforcing the nation's immigration laws hinges on equipping employers with the tools to determine quickly and effectively if a worker is legal or illegal," Michael Chertoff, the Homeland Security secretary, said this week in a press release. "E-Verify is a proven tool that helps employers immediately verify the legal working status for all new hires."

This fiscal year, the system has run more than 4 million employment-verification queries. Of those, 99.5 percent of qualified employees were cleared automatically by E-Verify, according to the Homeland Security department.

But the executive order might not take effect without a fight.

Michael Aitken, the director of government affairs for the Society of Human Resources Management, said that the organization supports the verification of new employees, but not by using E-Verify. The system isn't entirely accurate, said Aitken, whose organization, based in Virginia, represents member companies on human-resources issues.

Some job applicants who are authorized to work in the United States could be red-flagged without warrant, he said.

In that vein, U.S. Rep. Gabrielle Giffords, D-Ariz., who wants to stem the flow of illegal immigrants into her state, told a key House immigration panel this week that E-Verify must be overhauled and should not be used.

Giffords, pointing out that the Arizona legislature has made it mandatory for companies to use E-Verify, said that some business owners have reported a variety of challenges and problems with E-Verify.

And some job applicants have it worse. Between October 2006 and March 2007, she said, about 3,000 U.S. citizens who emigrated from other countries were incorrectly red-flagged as unauthorized to work in the United States.

Business owners are "finding it complicated, unreliable and burdensome," she said. "They are all experiencing the downfalls of using an inaccurate database with inadequate privacy protections."

Aitken, in a telephone interview, also cited raids made by immigration-enforcement officers of companies that had been using E-Verify.

Amy Kudwa, a Homeland Security spokeswoman, acknowledged that some companies using E-Verify have in fact been raided, and she said that improvements are being made to the system.

The main problem is that E-Verify doesn't always detect the use of fake IDs, such as a fake driver's license or Social Security card, Aitken said.

"It has been proven time and time again, even by DHS ... that the system is hugely susceptible to identity theft," he said.

According to the executive order, companies and organizations must use the system to be eligible for future contracts.

The order would affect anyone hired by the contractor in the United States during the contract term and everyone assigned by the contractor to perform work on the federal contract. This second provision is designed to cover employees hired by subcontractors.

The executive order must go through some administrative steps, including an open-comment period, before it can take effect.

HiPerf, the Kernersville consulting company, doesn't have to wait for that. It gets paid to help the Homeland Security department run more efficiently. So far this year, the check for doing that tops $2.5 million.

Bill Rose, the company president, said that HiPerf already uses E-Verify.

"You have to if you want to do business with the Department of Homeland Security," he said.

But HiPerf isn't the norm. Nationwide, only 69,000 employers -- both federal contractors and regular employers -- have signed up for E-Verify, Homeland Security officials said.

Last year, there were about 180,000 federal contractors, according to USAspending.gov. Few have signed up for E-Verify, and the same is true for some branches of Wake Forest University. Like most companies, the university and its different units, such as Wake Forest University Health Sciences and North Carolina Baptist Hospital, already have a process in place to determine the eligibility of workers.

The hospital branch has been using E-Verify for a year, said Mark Wright, a spokesman for Wake Forest University Health Sciences. School officials there will add E-Verify to the mix, he said.

Kevin Cox, a Wake Forest University spokesman, said that the university would find out more about it.

At Winston-Salem Industries for the Blind, which is second only to Wake Forest as the largest recipient of federal contracts since 2004 in Winston-Salem, E-Verify isn't used. But it will be if it allows the organization to continue getting federal contracts, officials said.

"Of course, if it makes everybody's lives easier, we're all for it. Everyone needs to be certain with who they're hiring. Certainly, we will participate," said Jeanne Wilkinson, the vice president of marketing and external affairs.

Bertrand M. Gutierrez can be reached at 727-7283 or at bgutierrez@wsjournal.com.

Newstex ID: KRTB-0222-25994874