Bush orders contractors to check employees' legal status

President Bush issued a sweeping executive order Monday that will require federal contractors to verify the legal status of all employees hired to work on new contracts, but the formal announcement left industry associations and immigration reform groups with many questions.

Making the announcement were Homeland Security Secretary Michael Chertoff, whose department will administer the employment verification program, and Commerce Secretary Carlos Gutierrez. A proposed rule detailing the mandate on federal contractors was expected to be issued Monday, followed by a 60-day period for public comment.

Although associations representing federal contractors said companies do not oppose having to verify the legal status of their workers -- and that most already do so under current law -- they said they feared the Homeland Security Department's electronic employee verification system, called E-Verify, is so faulty it will misidentify legal workers.

"Our members would welcome a workable online tool for employment verification," said Jennifer Kerber, a senior director for the Information Technology Association of America. "We're going to comply with what the government wants us to do, but we have concerns with the workability of the system."

"I wish the president hadn't issued the executive order but instead had pushed agencies to expand their consultation with the contracting community," said Alan Chvotkin, executive vice president and counsel for the Professional Services Council, whose member companies provide services to every federal agency.

"I actually have more questions than answers," he said.

He said questions that need answered include exactly which workers will need to be checked and whether the mandate will apply to subcontractors. Another question concerns what the consequences will be when the system cannot match a worker's identity.

Angelo Amador, director of immigration policy for the U.S. Chamber of Commerce, said it is not clear how many employees would be affected by the mandate.

"It seems that the way they're going is not something that we would end up supporting but we need to give them time to come up with the regulations," he said. "The number one question I've been getting is `what is the extent of this?' How many employees does this affect?"

Chertoff said the regulation could affect "hundreds of thousands, if not millions, of workers."

The department defends the E-verify program, saying that more than 10 percent of new hires across the country are being verified through it without major problems. The department has asked for $100 million for the program in FY09, and House Homeland Security appropriators are expected to take up the request at a markup Wednesday.

At the national level, E-Verify is a voluntary program for employers. But some states, like Arizona, have mandated its use.

Some immigration reform groups believe the action affecting federal contractors is a back-door attempt by Homeland Security to create a mandatory national employment verification system.

"We think it's extremely premature to extend this coverage . . . to federal contractors without addressing the shortcomings of E-Verify," said Mike Aitken, director of governmental affairs for the Society for Human Resource Management, which describes itself as the largest trade association for human resource professionals.

"If one looks at the requirements that have been placed on federal contractors, I think definitely that points toward some potential approach to require, eventually, all employers to use [E-Verify] through the regulatory process," Aitken said.

But proponents of E-Verify view the mandate as a positive.

"It's an essential step," said Mark Krikorian, executive director of the Center for Immigration Studies. "In fact, it may even be a better way to start the process than a congressional mandate for all employers to use it because it's a way of phasing the system in for more and more parts of the economy."

A Homeland Security spokesman said the department hopes to have a rule go into effect this fall.