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M;trrlr 1 !)!tO IMMIGRATION 

REFORM 

Employer Sanctions 

and the Question of 

Discrimination 

_--- 

9 

140974 
United States 

General Accounting Office 

Washington, D.C. 20648 

Comptroller General 

of the United States 

H- 12,5(X? 1 

March 29, 1990 

The President of the Senate and the 

Speaker of the House of Representatives 

This is the third and final annual GAO report required by Section 101(a) of the Immigration 

Reform and Control Act of 1986. The act prohibits employers from knowingly hiring 

unauthorized workers. Noncompliance can result in sanctions to the employer. 

The act requires us to review the implementation and enforcement of the employer 

verification and sanctions provisions of the law for the purpose of determining if such 

provisions (1) have been carried out satisfactorily, (2) have caused a widespread pattern of 

discrimination against U.S. citizens or other eligible workers, and (3) have caused an 

unnecessary regulatory burden on employers. 

We are sending copies of this report to the Attorney General; the Secretary, Department of 

Labor; the Secretary, Department of Health and Human Services; the Chairman, Equal 

Employment Opportunity Commission; the Chairman, U.S. Commission on Civil Rights; the 

Director, Office of Management and Budget; and other interested parties. 

This report was prepared under the overall direction of Richard L. Fogel, Assistant 

Comptroller General, General Government Programs. Alan M. Stapleton was the Project 

Director. Other major contributors are listed in appendix VII. 

Charles A. Bowsher 

Comptroller General 

of the [Jnited States 
Eljcecutive Summary 

Pu/rpose / 

/ 

/ 

The Immigration Reform and Control Act of 1986 (IRCA) requires 

employers to verify the employment eligibility of workers. It imposes 

civil and criminal penalties (sanctions) against employers who knowingly hire unauthorized workers. (See p. 16.) The law also requires GAO 

to issue three annual reports to Congress for the purpose of determining 

whether IRCA'S employer verification and sanctions section (referred to 

hereafter as the sanctions section) has (1) created an unnecessary burden on employers, (2) been carried out satisfactorily, and (3) resulted in 

a pattern of discrimination against eligible workers. (See p. 23.) GAO is 

also to determine whether frivolous discrimination complaints have 

been filed under IRCA'S antidiscrimination section to harass employers. 

This is the third GAO report. 

1 

Background During the 1970s and 198Os, Congress became increasingly concerned 

about the escalating rate of illegal immigration. After intense debate, 

Congress passed IRCA, which enlists the Nation’s employers in the battle 

to regain control of our borders. 

The law requires all employers to complete an Employment Eligibility 

Verification Form for each new employee. New employees can use any 

of 17 different documents to establish their eligibility to work (e.g., 

Social Security card). Ten of these documents are issued by the Immigration and Naturalization Service (INS). The law authorizes INS and Department of Labor officials to inspect employers’ verification forms. (See 

p. 17.) 

Congress was concerned that the law’s system of verification and sanctions would cause employers to discriminate against “foreign-appearing” U.S. citizens and legal aliens. As a result, the law prohibits 

employers with four or more employees from discriminating on the basis 

of a person’s national origin or citizenship status. (See p. 19.) 

IRCA provides an option for Congress to consider repealing the sanctions 

and antidiscrimination sections of the law if GAO determines in its third 

report that “a widespread pattern of discrimination has resulted 

against” eligible workers seeking employment “solely from the implementation of” that section. While the law does not define “widespread 

pattern of discrimination,” the legislative history indicates that it was 

intended to mean “a serious pattern of discrimination” and more than 

“just a few isolated cases of discrimination.” According to the legislative 

history, the reference to discrimination resulting “solely” from implementation of the sanctions section was designed to isolate “new” or 

Page 2 GAO/GGD-90-62 Employer Sanctions 
Executive Summary 

“increased” discrimination attributable to IR(ZG from discrimination that 

would have occurred irrespective of IRCA. (See p. 23.) 

Congress has mandated that GAO determine whether widespread discrimination has resulted solely from the law. This is difficult to prove or 

disprove. First, there is an absence of a sensitive pre-IRCA measure of 

discrimination. Further, there was no comparison group not subject to 

IRCA. Recognizing these limitations, GAO used the best available evidence 

to meet its congressional mandate. 

IRCA also provides an option for Congress to repeal its antidiscrimination 

section if GAO determines that the section has been a vehicle for frivolous complaints against employers. (See p. 36.) 

For this third report, GAO (1) reviewed federal agency implementation of 

IRCA, (2) reviewed discrimination complaints filed with federal agencies 

and data from groups representing aliens, and (3) used additional methods to obtain data on IRCA'S effects. These methodologies included a statistically valid survey of over 9,400 of the Nation’s employers, which 

projects to a universe of about 4.6 million employers. (See p. 27.) In collaboration with the Urban Institute, GAO also did a “hiring audit” in 

which pairs of persons matched closely on job qualifications applied for 

jobs with 360 employers in two cities. One member of each pair was a 

“foreign-appearing, foreign-sounding” Hispanic and the other was an 

I Anglo with no foreign accent. (See p. 29.) 

Redults in Brief GAO found that the law 

l has apparently reduced illegal immigration and is not an unnecessary 

burden on employers, 

l has generally been carried out satisfactorily by INS and Labor, and 

. has not been used as a vehicle to launch frivolous complaints against 

employers. 

GAO also found that there was widespread discrimination. But was there 

discrimination as a result of IRCA? That is the key question Congress 

directed GAO to answer. GAO'S answer is yes. 

Making such a link is exceedingly difficult. GAO used various techniques 

and approaches to try to measure the discrimination and determine the 

link, None of these techniques or approaches was or could be ideal. Some 

may disagree with GAO'S conclusion. But, on the basis of employers’ 

Page 3 GAO/GGD-9082 Employer Sanctions 
-- 

Jhxutlve Summary 

responses to key questions GAO asked about their hiring behavior and 

how it related to provisions of IRCA, GAO'S judgment is that a substantial 

amount of the discrimination did occur as a result of IRCA. 

The decision Congress must now make is difficult because of IRCA'S 

mixed results. There has been discrimination. An estimated 461,000 

employers, or 10 percent of all those surveyed, reported national origin 

discrimination as a result of the law, but 90 percent did not; thus, IRCArelated discrimination is serious but not pervasive. And the sanctions 

provision at this time appears to have slowed illegal immigration to the 

United States. 

GAO believes many employers discriminated because the law’s verification system does not provide a simple or reliable method to verify job 

applicants’ eligibility to work. Thus, it is likely that the widespread pattern of discrimination GAO found could be reduced if employers were 

provided with more education on the law’s requirements and a simpler 

and more reliable verification system. 

In the final analysis, GAO sees three options for Congress: (1) leaving 

IRCA as is for the present, (2) repealing the sanctions and antidiscrimination provisions, or (3) amending IRCA'S verification system to reduce the 

law’s discriminatory effects. 

Principal Findings 

Illegal Immigration Being GAO'S criteria in determining if the implementation of the sanctions secRqduced; Law Not an tion has caused an “unnecessary” regulatory burden on employers was 

Utinecessary Burden based on whether the law’s objectives were realized. GAO found that the 

burden of applying the law’s verification requirements was not “unnecessary” because the law has apparently reduced illegal immigration and 

employment, as Congress envisioned. While not conclusive, nearly all 

available data suggests the law’s objectives have been at least partially 

realized. (See p. 102.) For example, 

l a statistical study by the Urban Institute concluded that the law had 

slowed illegal immigration, 

l two surveys in Mexico found that people believe it is now harder to find 

work in the United States, and 

Page 4 GAO/GGD9082 Employer Sanctions 
J3xecutiveSummary 

l about 16 percent of aliens apprehended during employer sanctions 

investigations during August and September 1989 reported difficulty 

finding a job because of the law’s verification system. 

INS knd Labor Have Met 

Thei Minimum h- Responsibilities Under the 

Law1 

GAO decided that the sanctions section would have been carried out “satisfactorily” if the government developed plans and policies and implemented procedures that could reasonably be expected to (1) educate 

employers about their requirements under the law and (2) identify and 

fine violators. GAO found that INS and Labor have generally fulfilled 

their responsibilities under this definition of “satisfactorily.” (See p. 87.) 

However, GAO also found that INS could improve its methods for determining employer compliance with the law’s requirements. (See p. 92.) 

As of September 1989, INS had issued notices of intent to fine employers 

for about 3,500 violations for knowingly hiring or continuing to employ 

unauthorized aliens. There were also about 36,000 violations for not 

completing the verification forms. The total fines assessed were about 

$17 million. (See p. 88.) GAO'S review of about 300 randomly selected 

employer sanctions case files showed that INS field offices had correctly 

carried out the Commissioner’s policy on employer fines. (See p. 89.) 

Between September 1987 and September 1989, Labor officials completed 

over 77,000 inspections of employers’ verification forms. (See p. 91.) 

Following the government’s extensive efforts to educate employers, 

including direct contact with over 2 million employers, GAO estimates 

that 3.8 million (83 percent) of the 4.6 million employers in the survey 

population were aware of the law. Of the 2.4 million employers who 

were aware of the law and hired at least one employee during 1988, GAO 

estimates that 1.6 million (65 percent) reported being in full compliance 

with the verification requirement. (See p. 98.) 

No Evidence of Frivolous GAO'S review of the Office of Special Counsel and the Equal Employment 

Cofiplaints Opportunity Commission’s discrimination data found no evidence of 

frivolous IRCA discrimination complaints to harass employers. (See 

p. 112.) 

Emrjloyers Repgrted 

Discriminatory Practices 

Resulting From the Law 

GAO'S survey results indicate that national origin discrimination resulting from IRCA, while not pervasive, does exist at levels that amount to 

more than “just a few isolated cases” and constitutes “a serious pattern 

of discrimination.” GAO estimates that 461,000 (or 10 percent) of the 4.6 

Page6 GAO/GGD9082EmployerSanctiona 
Executive Summary 

- 

million employers in the survey population nationwide began one or 

more practices that represent national origin discrimination. (See p. 38.) 

The survey responses do not reveal whether the persons affected by the 

discrimination were eligible to work. However, given that these employers hired an estimated 2.9 million employees in 1988, GAO believes it is 

reasonable to assume that many eligible workers were affected. 

An estimated 227,000 employers reported that they began a practice, as 

a result of IRCA, not to hire job applicants whose foreign appearance or 

accent led them to suspect that they might be unauthorized aliens. Also, 

contrary to IRCA, an estimated 346,000 employers said that they applied 

IRCA'S verification system only to persons who had a “foreign” appearance or accent. Some employers began both practices. (See p. 41.) 

Employers reported that they engaged in practices which under the law 

would be classified as discriminatory verification and hiring practices. 

They were in a variety of industries and areas of the Nation and 

included firms of various sizes. The levels of discrimination ranged by 

geographical location from 3 to 16 percent and were higher in areas having high Hispanic and Asian populations. 

These employer responses specifically related the discriminatory hiring 

and verification practices to IRCA. Therefore, they represent “new” 

national origin discrimination that would not have occurred without 

IRCA. There is no evidence that would lead GAO to believe that employers 

who said they discriminated as a result of IRCA did not. But even if some 

employers did not report accurately, the remaining group would be 

substantial. 

Since these data meet the criteria in the law and its legislative history, 

GAO concluded that the national origin discriminatory practices reported 

do establish a widespread pattern of discrimination. On the basis of the 

information GAO has, GAO determined that it is more reasonable to conclude that a substantial amount of these discriminatory practices 

resulted from IRCA rather than not. (See p. 37.) 

Finally, GAO'S hiring audit of 360 employers in Chicago, Illinois, and San 

Diego, California, showed that the “foreign-appearing, foreign-sounding” Hispanic member of the matched pairs was three times more likely 

to encounter unfavorable treatment than the Anglo non-foreign-appearing member of the pairs. For example, the Anglo members received 52 

percent more job offers than the Hispanics. These results, taken together 

Page 0 GAO/GGD9082 Employer Sanctions 
Executive Summary 

with the survey responses, show a serious problem of national origin 

discrimination that GAO believes IRCA exacerbated. (See p. 49.) 

Reported Other 

s of Discriminatory 

Emdloyers Want Improved About 78 percent of employers said they wanted a simpler or better verVeripcation System ification system. The portion of employers who wanted these changes 

was 16 to 19 percent greater among those who reported discriminatory 

practices than among those who did not report discriminatory practices. 

GAO believes the responses tend to reflect employers’ confusion and 

uncertainty about the law’s verification system and that a simpler system that relies on fewer documents could reduce discrimination. (See 

p. 62.) 

While GAO’S statutory determination is limited to national origin discrimination that can be linked directly to IRCA'S sanctions section, GAO’S survey results indicate that the law also resulted in citizenship 

discrimination. 

GAO estimates that an additional 430,000 employers (9 percent) said that 

because of the law they began hiring only persons born in the United 

States or not hiring persons with temporary work eligibility documents. 

These practices are illegal and can harm people, particularly those of 

Hispanic and Asian origin. (See p, 38.) 

Adding these employers to those who began national origin discrimination, GAO estimates that 891,000 (19 percent) of the 4.6 million employers in the survey population nationwide began one or more 

discriminatory practices as a result of the law. 

Contributing to the uncertainty that arises from the variety of documents in use is the prevalence of counterfeit documents. INS apprehensions of unauthorized aliens show they commonly have counterfeit or 

fraudulently obtained documents- Social Security cards or one of the 

various INS alien work eligibility cards. (See p. 66.) 

By the mid-1990s, INS plans to (1) reduce from 10 to 2 the number of 

work eligibility cards it issues and to make these 2 cards more difficult 

to counterfeit and (2) replace over 20 million old INS cards with the new 

ones. However, this schedule depends on additional funding and personnel. Unless this process is expedited, little will be accomplished in the 

near term to reduce employer confusion and uncertainty about aliens’ 

work eligibility status. (See p. 67.) 

Page 7 GAO/GGD90-62 Employer Sanctions 
Imbroved Verification 

Sy tern 

s; 

Needed If 

Sa , ctions Are Retained 

, 

GAO identified three possible reasons why employers discriminated: (1) 

lack of understanding of the law’s major provisions, (2) confusion and 

uncertainty about how to determine eligibility, and (3) the prevalence of 

counterfeit and fraudulent documents that contributed to employer 

uncertainty over how to verify eligibility. (See p. 60.) 

GAO'S work suggests that the widespread pattern of discrimination it 

found could be effectively reduced by (1) increasing employer understanding through effective education efforts, (2) reducing the number of 

work eligibility documents, (3) making the documents harder to counterfeit, thereby reducing document fraud, and (4) applying the new documents to all members of the workforce. 

Such actions would make it easier for employers to comply with the law. 

They would relieve employer concerns about counterfeit documents. 

And they would reduce employer confusion over the many documents 

which can now be used for verifying work eligibility. 

Congress anticipated that the verification system might need improvement. Section lOl(a)( 1) of IRCA establishes procedures governing proposals to improve the employment verification system. The section specifies 

that improvements to the verification system proposed by the President 

should provide for reliable determinations of employment eligibility and 

identity, be counterfeit-resistant, protect individual privacy, and not be 

used for law enforcement purposes unrelated to IRCA. 

Reducing the number of eligibility documents will raise many concerns-ranging from civil liberty issues to cost and logistic issues. 

Should Congress opt for this solution, it will have to consider carefully 

the tradeoffs between the goal of assuring that jobs are reserved for 

citizens and legal aliens versus the goal of reducing discrimination in the 

process. Both objectives are important. (See p. 73.) 

Mhters for 

Cdngressional 

Consideration 

The discrimination GAO found is serious and requires the immediate 

attention of both Congress and the Administration. There are two ways 

to proceed. 

Y 

One way is to rely upon the President to propose verification system 

changes he deems necessary, pursuant to the provisions of section 

101(a)(l) of IRCA. This course would leave the initiative for action up to 

the executive branch. However, the necessary changes would require 

Page 8 GAO/GGD90-62 Employer Sanctions 
Executive Summary 

extensive debate and discussion between the legislative and executive 

branches before a final decision could be made on the solution. 

The second alternative is for Congress to initiate discussions with the 

executive branch and interested parties on solutions to the IRCA verification problem that should be considered in light of GAO'S findings. Given 

the lengthy time frames set by section 101(a)(l), this alternative could 

expedite the process. 

In the final analysis, Congress has the following options: (1) leaving the 

sanctions and antidiscrimination provisions of the law as is for the present time, (2) repealing these provisions, or (3) leaving the current provisions in place and enacting legislation to amend IRCA'S verification 

system to reduce the extent of discrimination resulting from IRCA. 

The exact nature of the solution will emerge only after the debate that is 

inherent in the democratic process. 

Should Congress decide to retain sanctions and improve the current verification system, three principles for improving the system while reducing discrimination need to be kept in mind. These are: (1) reducing the 

number of work eligibility documents, (2) making the documents more 

counterfeit-resistant and less vulnerable to being used fraudulently, and 

(3) applying any reduced work eligibility documents to all members of 

the workforce. Congress could then defer further consideration of 

repealing the sanctions and antidiscrimination provisions of IRCA until a 

simpler and more reliable verification system has been in place for sufficient time to evaluate its effectiveness. (See p. 78.) 

I 

Redommendations to GAO recommends increased educational efforts for the Nation’s employthe! Attorney General ers on how to comply with IRCA'S antidiscrimination provision and various actions that the Attorney General can take to improve INS’ 

management of the law. (See p. 100.) 

Agency Comments 

* 

During the course of its work, GAO kept officials of the various agencies 

apprised of the substance of its findings through periodic briefings. GAO 

also discussed its tentative conclusions with key Justice Department 

officials. GAO'S principal findings on discrimination were entirely dependent on data GAO generated from sources outside of these agencies. GAO 

thus did not seek agency comments on its recommendations. (See p. 36.) 

Page 9 GAO/GGD-9082 Employer Sanctions 
contents 

E$ecutive Summary 2 

I I C 

In reduction 

: 

apter 1 16 

Employer Verification of Work Eligibility 17 

INS Responsible for Enforcing the Sanctions Provision 20 

Two Labor Offices Responsible for Inspecting Employers’ 21 

Records 

Previous GAO Reports 22 

Chapter 2 23 

Objectives, Scope, and How We Defined a “Widespread Pattern” of 23 

Methodology Discrimination 

How We Defined Carrying Out the Sanctions Provision 34 

Satisfactorily 

How We Defined Unnecessary Regulatory Burden 35 

Private Groups’ Use of Discrimination Protection to 36 

Harass Employers 

/ Agency Comments 36 I 

Ctiapter 3 37 

Dikriminatory GAO Measures Showing Discrimination 38 

Practices Widespread: Other Measures Do Not Show IRCA Discrimination 57 

A Substantial Amount Several Factors Lead to New Discrimination 60 

Efforts to Reduce IRCA-Related Discrimination Are 67 

Resulted From the Underway 

Law Conclusions 

Matters for Congressional Consideration 

Recommendation to the Attorney General 

71 

78 

79 

Chapter 4 

St&dies by City, State, 

80 

Survey of Private, State, and Local Agencies’ 80 

anti Private Discrimination Complaints 

Organizations Show City and State Organizations Study Discrimination 82 

Conclusion 86 

IRCA-Related 

Discrimination 

Page 10 GAO/GGD90-62 Employer Sanctions 
I Contents 

I 

, Chabter 5 87 

INS bnd Labor Have 

Genbrally Met Their 

Resbonsibilities to 

INS Implementation of IRCA 

INS Policy for Fining Employers Was Carried Out 

Satisfactorily 

Employers Reported INS Education Efforts Helped 

Familiarize Them With the Law 

Department of Labor Implementation of IRCA 

Opportunities to Improve INS Implementation of the Law 

Aspects of IRCA Implementation That Are Not Included 

in “Satisfactorily” Carrying Out the Law 

Conclusions 

Recommendations 

Agency Comments 

88 

89 

90 

91 

92 

98 

99 

100 

101 

Chapter 6 102 

IRa ]ilm Not Created Law Appears to Be Reducing Illegal Immigration and 103 

an Unnecessary or Employment 

Unreasonable 

GAO Indicators of Employer Sanctions’ Effectiveness 106 

IRCA-Related Employer Costs 110 

Regulatory Burden for Employer Comments on the Law’s Burden 

Employers No Evidence of Frivolous Complaints 

Conclusions 

111 

112 

112 

Appendix I: Fiscal Year 1988, 1989, and 1990 INS 

Budgets for Employer Sanctions 

Appendix II: Survey of Employers’ Reactions to the 1986 

Immigration Reform and Control Act 

Appendix III: Technical Appendix 

Appendix IV: Legal Analysis of the Comptroller General’s 

Determinations Under the IRCA Termination 

Provisions 

114 

115 

123 

137 

Appendix V: Survey of Job Applicants 

Appendix VI: Data Collection of State, Local, and Private 

Organizations on Employment-Related Discrimination 

Complaints 

151 

156 

Appendix VII: Major Contributors to This Report 162 

Tables 

J 

Table 1.1: Documents That Applicants Can Use to 

Establish Work Eligibility 

18 

Table 2.1: Employer Survey Sample 28 

Page 11 GAO/GGlMO-62 Employer Sanctions 
Contents 

Table 2.2: Location and Citizenship Status of Job 

Applicants Surveyed 

Table 3.1: GAO’s Employer Survey Questions on National 

Origin and Citizenship Discrimination 

Table 3.2: Total Number of Testers Reaching Significant 

Stages in the Hiring Process 

Table 3.3: Summary of OSC Charges 

Table 3.4: Summary of OSC Independent Investigations 

March 15,1988, to September 30,1989 

Table 3.6: OSC Budgets for Fiscal Years 1988 to 1990 

Table 4.1: Discrimination Complaints Received by Private, 

State, and Local Organizations 

Table 5.1: INS Enforcement Actions (November 6, 1986, 

to September 16, 1989) 

Table 5.2: I-9 Compliance by Geographic Area 

Table 6.1: Number of 1-9s Prepared 

Table III. 1: Employer Questionnaire Disposition for Each 

Stratum 

Table 111.2: Sampling Error Calculations for Questions 

Where the Error Exceeded 5 Percent 

Table 111.3: Employer Universes for Selected Figures 

Table 111.4: Estimates, Sampling Errors, and 95 Percent 

Confidence Limits for the Employers’ Fine Analysis 

Figures Figure 3.1: Levels of Discrimination Across the Nation 

Figure 3.2: Employers Who Said They Did Not Hire 

Persons Because of Their Foreign Appearance or 

Accent 

Figure 3.3: Employers Who Said They Applied the Law’s 

Verification System to Only Foreign-Looking or 

Foreign-Sounding Persons 

Figure 3.4: Employers Who Said They Began to Hire Only 

U.S. Citizens and Not Hire Persons With Temporary 

Work Eligibility Documents 

Figure 3.5: Employers With National Origin and 

Citizenship Discrimination Practices by Levels of 

Hispanics and Asians 

Figure 3.6: Employers With National Origin and 

Citizenship Discrimination Practices by Number of 

Employees 

Figure 3.7: Percentage of Audited Employers Who 

Favored Hispanics or Anglos 

Figure 3.8: Employers Applied Verification System 

Differently for Foreign-Sounding Persons 

32 

39 

48 

54 

56 

56 

82 

88 

99 

111 

125 

128 

130 

136 

40 

41 

42 

43 

45 

46 

47 

51 

Page 12 GAO/GGD-9082 Employer Sanctions 
Cantent. 

Figure 3.9: Most Common OSC Charge Alleges Employers 

Refused to Accept Documentation 

Figure 3.10: OSC Charge Data Show Rise Following April/ 

June Public Service Announcement 

Figure 3.11: EEOC Complaints by Employer Action Filed 

on the Basis of National Origin And/Or Race 

Figure 3.12: EEOC IRCA-Related Charges Decline 

Figure 3.13: Employer Awareness of the Law Increased in 

1989 but Understanding of Sanctions Decreased 

Figure 3.14: Some of the Documents Persons Can Use to 

Establish Work Eligibility 

Figure 3.15: Employers Who Discriminate Favor 

Improvements to the Verification System More Than 

Nondiscriminators 

Figure 4.1: Surveyed Private, State, and Local 

Organizations Received the Majority of Their 

Complaints From Authorized Aliens 

Figure 6.1: Border Patrol Linewatch Apprehensions 

Measured by lo-Hour Shifts 

Figure 6.2: Illegally Employed Alien Arrests Per INS 

Investigator Hour 

Figure 6.3: Visa Violations: Percentage of Estimated Visa 

Overstayers to Expected Departures 

Figure 6.4: Number of Non-Work Social Security Cards 

With Wages Reported, 1983-89 

53 

55 

58 

59 

61 

64 

65 

81 

107 

108 

109 

110 

Page 13 GAO/GGD90-62 Employer Sanctions 
Contents 

Abbreviations 

CPS 

EEOC 

ESA-91 

FISA 

GAP 

I-9 

INS 

IKCA 

LAW 

MALDEF 

NLRA 

OFCCP 

OMH 

osc 

SBA 

SIC 

SSA 

SSN 

WHD 

Page 14 

Current Population Survey 

Equal Employment Opportunity Commission 

Employment Eligibility Verification Record Keeping 

Requirements Form 

Fair Labor Standards Act 

General Administrative Plan 

Employment Eligibility Verification Form 

Immigration and Naturalization Service 

Immigration Reform and Control Act of 1986 

Legally Authorized Worker Program 

Mexican American Legal Defense and Educational Fund 

National Labor Relations Act 

Office of Federal Contract Compliance Programs 

Office of Management and Budget 

Office of Special Counsel for Immigration-Related Unfair 

Employment Practices 

Small Business Administration 

Standard Industrial Code 

Social Security Administration 

Social Security Account Number 

Wage and Hour Division 

GAO/GGD-90-62 Employer Sanctions 
Page 16 GAO/GGD-90-62 Employer Sanctions 
Chbpter 1 

Ihtroduction 

During the 1970s and 1980s border patrol apprehensions of aliens 

entering the country illegally increased from about 250,000 in 1970 to 

about 1.6 million in 1986. In 1971, Congress began to consider legislation 

that would eliminate the magnet attracting illegal aliens-jobs. This legislation would, for the first time, penalize employers for knowingly 

employing aliens who were not authorized to work. This was a controversial proposal, as evidenced by the 15 years of debate leading to the 

enactment of the Immigration Reform and Control Act (IRcA) on November 6, 1986. A key controversy was whether employers would, fearing 

sanctions, begin to discriminate against foreign-looking or foreignsounding citizens and legal aliens. 

In 1981 the Select Commission on Immigration and Refugee Policy, 

which was appointed to study the problem of immigration reform, 

stressed the need for a secure and uncomplicated employer verification 

system. The Commission’s final report stated that: 

‘4 

* 1 * an effective employer sanctions system must rely on a reliable means of verifying employment eligibility. Lacking a dependable mechanism for determining a 

potential employee’s eligibility, employers would have to use their discretion in 

determining that eligibility.“’ 

The report also stated that (1) most of the Commissioners supported a 

means of verifying employee eligibility that would enable employers to 

have confidence that applicants were authorized to work and (2) the 

Commissioners believed that a secure verification system would alleviate any potential discrimination. 

Section 101(a)(l) of IRCA (referred to hereafter as the sanctions provision) requires verification of work eligibility and establishes penalties 

(sanctions) for employers who knowingly hire unauthorized aliens. Specifically, the act (1) makes it unlawful to knowingly hire and recruit or 

refer for a fee aliens who are not authorized to work in the United 

States, (2) requires those who hire and recruit or refer for a fee to verify 

both the identity and the employment eligibility of hired individuals 

(including U.S. citizens), and (3) makes it unlawful to knowingly continue to employ an alien who is or has become unauthorized to work or 

to knowingly obtain the services of an unauthorized alien through a contract. Depending on the violation, noncompliance with IRCA can result in 

civil and criminal penalties. The law permits employers to continue to 

’ U.S. Immigration Policy and The National Interest. The Final Report and Recommendations of The 

Select Commission on Immigration and Kefugee Policy to the Congress and the President of the 

United States, March 1, 1981. 

Page 16 GAO/GGD-90-62 Employer Sanctions 
Chapter 1 

Introduction 

employ unauthorized aliens hired before November 6, 1986, (i.e., 

“grandfathered” aliens) without being sanctioned, but the Immigration 

and Naturalization Service (INS) can deport such aliens. 

The act also prohibits employment discrimination on the basis of 

national origin and citizenship status, The law established a new 

enforcement unit within the Department of Justice-the Office of the 

Special Counsel for Immigration-Related Unfair Employment Practices 

(osc)-to prosecute complaints alleging national origin and citizenship 

status discrimination. It further authorized the Attorney General to designate administrative law judges to hear discrimination and employer 

sanctions cases. 

I 

Enhployer Verification Generally, for employees hired after November 6, 1986, IRCA requires all 

of Fork Eligibility employers to verify the employee’s identity and eligibility to work in the 

United States. Job applicants may use any of 17 various documents-10 

of which INS issues-to establish employment eligibility. (See table 1.1.) 

On the basis of such documents, employers are required to complete an 

Employment Eligibility Verification Form (i-s) for each new employee. In 

completing the I-9 form, employers certify that they have examined the 

documents presented by the applicant, that the documents appear genuine, and that they relate to the individual named. Therefore, in making 

their certifications, employers are expected to judge whether the documents presented are obviously fraudulent or counterfeit.” The completed 

I-9 forms are then subject to inspection by both INS and the Department 

of Labor. 

“A counterfeit document is one that is illegally manufactured, such as a fake Social Security card. A 

fraudulently used document is a genuine document that is illegally used (e.g., an alien using another 

person’s valid Social Security card) with or without alterations. 

Page 17 GAO/GGD-9082 Employer Sanctions 
Chapter 1 

Introduction 

Tabl’ocuments That Applicants 

Can 

; 

se to Establish Work Eligibility ..- -- 

1. US. Passport 

2. Certificate of U.S. Citizenship (Issued by INS) 

3. Certificate of Naturalization (Issued by INS) 

4. A foreign passport that includes an authorization to work 

.- -_.- 

5. Resident Alien INS Form l-551 

6. Temporary Resident Card, INS Form l-688 

-.-.. 

7. Employment Authorization Card, INS Form I-688A 

-.-_-- 

8. Social Security Card 

9. Reentry Permit, INS Form l-327 ~- 

?6:-f%efugeeTravel Document, INSForm t-571 

11, Certification of Birth issued by the State Department 

12. Certification of Birth Abroad issued by the State Department 

13. An original or certified copy of a birth certificate issued by a state, county, or municipal 

authority 

.--.____ 

14. An employment authorization document issued by INS 

.--___ -.- 

15. Native American tribal document 

-...-- _ 

16. U.S. Citizen Identification Card, INS Form l-197 

17. Identification card for use of resident citizen in the United States, INS Form l-179 

Source: 8 C.F.R. Section 274a.2(b)(1988). 

Changes in Employment 

Verification System 

Section 101(a)(l) of IRCA states that the President shall monitor and 

evaluate the extent to which IRCA’s verification system provides a secure 

method to determine employment eligibility. If the system is found not 

to be secure, any changes the President proposes should provide for reliable determinations of employment eligibility and identity, be counterfeit-resistant, protect individual privacy, be used for employment 

verification only, and not be used for law enforcement purposes unrelated to IRCA. 

The section also states that if the President proposes a major change to 

the verification system that would either (1) require an individual to 

present a new work eligibility card or (2) provide for a telephone verification system, the President must notify Congress of the proposed 

change 2 years in advance of implementation. If the President proposes 

a change in any card used for accounting purposes under the Social 

Security Act to make it a primary identifier, the President must notify 

Congress of the proposed change 1 year in advance of implementation. 

Either or both of these changes would require congressional approval. 

Page 18 GAO/GGD90-62 Employer Sanctions 
Chapter 1 

Introduction 

Tidetable for Employer The law and implementing regulations established timetables for enforcVerification Requirements ing the law and related penalties. Implementation was divided into three 

phases: a 6-month education period, a l-year period when citations were 

issued to first-time violators,and full enforcement of sanctions against 

those who violate the law. When INS proposes to impose a penalty, it 

issues a Notice of Intent to Fine. 

Unlbwful Discrimination Congress was concerned that employers would not hire “foreign-looking 

or foreign-sounding” U.S. citizens or legal aliens to avoid being sancI tioned. Under the new immigration law, employers with four or more 

I employees may not discriminate against any authorized worker in hirI ing, discharging, recruiting, or referring for a fee because of that indi- 

, vidual’s national origin or citizenship status. Employers with fewer than 

four employees are not subject to the antidiscrimination section. 

Title VII of the Civil Rights Act of 1964 and the remedies against discrimination it provides remain in effect. Title VII prohibits discrimination against anyone on the basis of national origin in hiring, discharging, 

recruiting, assigning, compensating, and other terms and conditions of 

employment. Charges of national origin discrimination against employers with 15 or more employees are generally filed with the Equal 

Employment Opportunity Commission (EEOC). Additionally, under title 

VII, charges that involve both national origin and citizenship discrimination by those larger employers may be filed with EEOC. 

Under the new immigration law, charges of national origin discrimination against employers with 4 to 14 employees and charges of citizenship status discrimination against employers with 4 or more employees 

are filed with OSC. After investigating the charge, osc may file a complaint with an administrative law judge. The administrative law judge 

will conduct a hearing and issue a decision. 

Although IRCA'S antidiscrimination provision is distinct from and complements the provisions of title VII, both EEOC and osc have jurisdiction 

in some cases. These are cases where complainants allege both national 

origin and citizenship status discrimination against employers having 16 

or more employees. IRCA, however, prohibits filing the same discrimination charges arising from the same set of facts with both EEOC and OSC. A 

charging party is thus forced to file with one agency or the other. If the 

charging party selects an agency without authority over the complaint 

or for which no remedy is available (e.g., osc does not have authority 

over aspects of discrimination that deal with working conditions but 

Page 19 GAO/MD-9042 Employer Sanctions 
Chapter 1 

Introduction 

EEOC does), the charging party may not be able to make a second filing 

with the other agency before the statute of limitations runs out. To prevent this from occurring, EEOC and osc have referred charges to each 

other since the law passed and entered into an agreement effective in 

July 1989 designating each other as agents for purposes of complying 

with statute of limitations deadlines. 

Employers engaging in unfair immigration-related employment practices 

under the new law are to be ordered to stop the prohibited practice and 

may be penalized. They may be ordered to (1) hire, with or without back 

pay, individuals directly injured by the discrimination; (2) pay a fine; 

and (3) keep certain records regarding the hiring of applicants and 

employees. The judge can also require that the losing party pay the prevailing parties’ (other than the United States’) reasonable attorney fees 

if the losing party’s claim had no reasonable basis in law or fact. 

IN8 Responsible for 

Enforcing the 

Sarktions Provision 

INS is responsible for enforcing the sanctions provision.” According to an 

INS official, as of September 30, 1989, INS had 1,343 investigators on 

duty in its headquarters, 4 regional offices, and 33 districts. Besides 

sanctions cases, investigators are also responsible for enforcing provisions against immigration fraud and apprehending deportable criminal 

aliens. In fiscal year 1987, INS was authorized 135 additional Border 

Patrol positions to investigate employers, inspect 1-s forms, and educate 

employers about the law’s requirements. 

INS’ employer sanctions budget for fiscal years 1988 and 1989 was about 

$60 million and $63 million, respectively, or about 7 percent of its 

budget in both years. INS’ fiscal year 1990 employer sanctions budget of 

$71 million (8.4 percent of its budget) provides about 1,200 positions for 

employer sanctions. (See app. I for details on INS’ employer sanctions 

budgets.) 

According to INS records, about 62 percent of employer sanctions 

enforcement resources were used to investigate employers suspected of 

employing unauthorized aliens in fiscal year 1989. The rest was devoted 

to random I-9 compliance inspections nationwide. According to INS, this 

program-the General Administrative Plan (GAP)-has five objectives: 

(1) to detect 1-g form violations, (2) to identify employers who knowingly 

“Generally, INS investigators and Border Patrol agents are responsible for implementing the sanctions 

provision. Throughout this report “investigators” refers to both Horder Patrol agents and INS 

investigators. 

Page 20 GAO/GGD-90-62 Employer Sanctions 
- 

Chapter 1 

Introduction 

. 

hire unauthorized aliens, (3) to promote compliance, (4) to monitor I-Q 

compliance among various industries, and (5) to help plan future 

enforcement efforts. Half the inspections target employers from industries that have in the past employed significant numbers of unauthorized aliens. According to INS, the remaining inspections cover employers 

randomly selected from all industries and geographical areas to ensure 

fairness and balance in enforcing the law. 

The Commissioner of INS established the following objectives for the 

sanctions program during fiscal year 1989: 

aggressively investigate leads against substantive violators to develop 

high quality criminal and administrative cases; 

continue to implement GAP for compliance inspections; 

continue to systematically educate employers in an efficient and costeffective manner; 

continue developing a standardized employment authorization documentation system; and 

refine the existing INS management information system (called OASIS) 

for rapid and timely data collection, analysis, and dissemination. 

For fiscal year 1990, the President has established the following objectives for the program: 

24,000 employer inspections and investigations and increased imposition of sanctions where appropriate; and 

750,000 employer educational contacts and 830 public speaking engagements to increase employer and alien awareness of prohibitions and 

sanctions against unauthorized alien employment. 

1 

Tv\io Labor Offices Two offices within Labor’s Employment Standards Administration are 

Rehponsible for responsible for inspecting employers’ 1-9 forms-the Wage and Hour 

Division (wlm) and the Office of Federal Contract Compliance Programs 

Inspecting Employers’ (OFCCI’). In addition to its I-Q responsibilities, the WHD administers and 

Records enforces laws that establish standards for wages and working conditions. These laws cover virtually all private sector employment. From 

September 1, 1987, to August 31, 1989, WHD inspected 1-9s at 62,857 

employers. The oFccp--in addition to its 1-s responsibilities-administers a number of statutes, including Executive Order 11246, which prohibits federal contractors from discriminating on the basis of race, color, 

religion, sex, or national origin. From September 1, 1987, to August 3 1, 

1989, OFCCP inspected 1-9s at 10,531 employers. 

Page 21 GAO/GGD-90432 Employer Sanctions 
Chapter 1 

Introduction 

WHD and OFCCP forward the results of their I-Q inspections to INS district 

offices with information on apparent noncompliance with the I-Q requirements and possible employment of unauthorized workers. Under a continuing resolution for fiscal year 1990, Labor has been authorized $5 

million and 91 positions for I-Q compliance inspections, 

Jious GAO Reports From 1970 until IRGA’S enactment in 1986, we issued at least 16 reports 

on immigration reform and related issues. As early as 1973 we supported enactment of legislation to establish employer sancti0ns.I 

IRGA requires us to issue three annual reports on the sanctions provision 

each November starting in 1987. Specifically, the act requires us to 

review the implementation of the sanctions provision for the purpose of 

determining whether the provision has (1) been carried out satisfactorily, (2) caused a pattern of discrimination, and (3) created an unnecessary regulatory burden. 

Our first two reports? found that: 

l INS and Labor had carried out the sanctions provision satisfactorily. 

l Information was insufficient to determine if the sanctions provision had 

caused an unnecessary regulatory burden on employers. 

l The data on discrimination did not establish that the sanctions provision 

(1) had caused a pattern of discrimination or (2) was an unreasonable 

burden on employers. However, on the basis of our survey of employers, 

we estimated in our second report that since IRGA’S enactment, 528,000 

employers began or increased unfair employment practices (e.g., began a 

new policy to hire only U.S. citizens). We could not determine whether 

the employers began these practices because of the law or how many 

eligible workers were affected. 

‘More Needs to be Done to Reduce the Number and Adverse Impact of Illegal Aliens in the United 

States (July 31, 1973, R-125051). 

‘;Immigration Reform: Status of Implementing Employer Sanctions After One Year (GAO/GGD-88-14, 

Nov. 5, 1987); Immigration Reform: Status of Implementing Employer Sanctions After Second Year 

(GAO/GGD-8%16, Nov. 15, 1988). 

Page 22 GAO/GGD-SO-62 Employer Sanctions 
ChaIXer 2 

Objectives, Scope, and Methodology 

-- 

The objectives of this review were to determine whether the sanctions 

provision 

l resulted in a pattern of discrimination against eligible workers, 

l was carried out satisfactorily by INS and Labor, and 

. resulted in an unnecessary regulatory burden for employers. 

Another objective was to determine if an unreasonable burden on 

employers was created by private groups’ use of the expanded antidiscrimination protection in IRCA to harass employers. 

In general, our objective regarding discrimination was to provide information that Congress can use to determine if provisions of the law 

should be repealed. The act provides expedited procedures to consider 

repealing the sanctions provision if we find that it has resulted in a 

widespread pattern of discrimination and if Congress concurs with our 

conclusion. In addition, if we report that no significant discrimination 

has resulted from the sanctions provision or that an unreasonable burden has been created for employers, Congress can repeal the antidiscrimination provision using those procedures. Congress could repeal 

these sections by enacting a joint resolution within 30 days of our 

report, stating in substance that it approves our findings. The provisions 

to repeal the law are discussed in more detail in appendix IV. 

The following describes the criteria we used and the scope and methodology of the work we did to meet our objectives. In summary, we used a 

considerable degree of judgment in further defining our review objectives because the law and legislative history provide little guidance. 

Hdw We Defined a We analyzed IRCA and its legislative history to identify the criteria Con- 

“\Yidespread Pattern” gress wanted us to apply in making a determination on a “widespread 

pattern” of discrimination. On the basis of that analysis: 

of Discrimination 

. The criteria include discrimination in the hiring, or recruitment or referral for a fee, and discharging of employees or job applicants but not discrimination involving conditions of employment, such as wages or 

promotions. Discrimination in such areas as housing or public accommodations is not included. 

l The criteria include discrimination on the basis of a person’s national 

origin and also on the basis of a person’s citizenship or alien status to 

the extent such discrimination has the purpose or effect of discriminating on the basis of national origin. 

Page 23 GAO/GGD-90-62 Employer Sanctions 
-- 

Chapter 2 

Wectives, Scope, and Methodology 

l The criteria include discrimination that is “new” resulting “solely” from 

the implementation of employer sanctions, This element can be satisfied 

by (1) evidence that discrimination was motivated by the sanctions provision; or (2) evidence of discrimination on the basis of actions that are 

unique to IRCA, such as the documentation and verification requirements 

(e.g., use of the form I-9). 

l The criteria include the number of employers who discriminate, the 

number of employees or applicants affected, and the distribution of discriminatory practices by industry type and geographic region. The 

determination of “widespread pattern” calls for exercising judgment 

since there is no precise formula that applies. However, the legislative 

history indicates that such a “widespread pattern” exists if the sanctions provision has resulted in “a serious pattern of discrimination” and 

more than “just a few isolated cases of discrimination.” 

Appendix IV contains a more detailed presentation of our legal rationale 

for our definition of widespread discrimination along with a discussion 

of comments we received on the draft legal analysis from various individuals and organizations. The commenters generally agreed with most 

aspects of our analysis. However, most commenters disagreed with one 

aspect of our analysis -that Congress did not intend for our determination to include citizenship discrimination that does not have the purpose 

or effect of national origin discrimination. Because of this disagreement, 

we attempted to measure citizenship discrimination resulting from the 

sanctions provision so that Congress may make its own judgment about 

the significance and effects of such practices. 

Mekhodologies Used to The best methodology to determine whether IRCA has resulted in a patDetermine Whether the tern of discrimination would have been to measure employment discrimSaktions Provision ination before IRCA and then compare it with information gathered after 

Re$ulted in a “Widespread IRCA had been implemented and to rule out other possible explanations 

Pattern” Of Discrimination 

for changes. Unfortunately, we were not able to locate sensitive pre-IRcA 

baseline measures of discrimination, Further, there was no comparison 

group not subject to IRCA. Thus, we have used multiple methods to obtain 

a variety of measures on the effects of the law. 

When Congress mandated that we measure the law’s discriminatory 

effects, it knew we could not turn the clock back. Congress also knew we 

would not be able to develop a rigorous design to arrive at causal linkages. Nonetheless, Congress included a provision in IRCA that requires us 

to determine if the law resulted in a “widespread pattern of discrimination” Given this perspective, we believe it is reasonable to assume that 

Page 24 GAO/GGD-9042 Employer Sanctions 

. 
Chapter 2 

Objectives, Scope, and Methodology 

. 

Congress wanted GAO, recognizing the obvious methodological limitations, to proceed with the review and exercise reasonable judgment on 

the basis of the best available evidence in reaching our determination. 

We considered the evidence from different methods as sufficient to provide a basis for making a reasonable determination. 

The different methods used to provide evidence on whether implementing the sanctions provision has resulted in a widespread pattern of discrimination against authorized workers were: 

A survey of a stratified random sample of 9,491 employers to determine 

whether and how hiring practices were affected by the sanctions 

provision. 

A “hiring audit” of 360 randomly selected employers in two cities. For 

each audit, two people applied separately for a job advertised in the 

newspaper. The pair was closely matched on job qualifications, but one 

person in each pair was foreign-looking and foreign-sounding. We then 

compared how employers treated both job applicants. We also sent these 

employers our employer survey. 

A survey of 300 judgmentally selected persons who had applied for a 

job in person since January 1, 1989, in Miami, New York City, Chicago, 

Dallas, and Los Angeles. We compared the experiences relayed by the 

foreign-sounding applicants and non-foreign-sounding applicants 

regarding the employers’ hiring practices. 

An analysis of the number of national origin discrimination charges 

received by EEOC from fiscal year 1979 to May 1989. The purpose was to 

determine whether there has been a significant increase in charges after 

IRCA We also accumulated data on the number of charges that EEOC categorized as IRcA-related. We did not verify the accuracy or reliability of 

the EEOC system for tracking discrimination charges, 

A review of discrimination charges received by osc from May 1988 to 

May 1989 to identify those that appeared to be related to employer 

sanctions. 

An analysis of state employment service data in Illinois, Florida, and 

Texas to compare the percentages of Hispanics and other minorities’ 

who found jobs through state employment services with that of Anglos 

and blacks before and after IRCA. We did not verify the accuracy or reliability of the employment services’ placement files. 

‘Othrr minorities include American Indian, Alaskan Native, and Asian and Pacific Islander. 

Page 25 GAO/GGD-90-62 Employer Sanctions 

r 
Chapter 2 

ObJectives, Scope, and Methodology 

We also collected data on the number and types of employment discrimination charges that various state, local, and private organizations had 

received from July 1, 1988, to June 30, 1989. 

To encourage employers to answer our survey questions honestly, the 

survey responses were anonymous. We did not explicitly ask employers 

to judge whether their reported hiring practices were discriminatory. 

Rather, we developed seven survey questions that described a range of 

possible hiring practices that we determined constituted illegal discriminatory behaviors. (See table 3.1.) All seven questions either asked about 

practices employers started as a result of their understanding of the law 

or described behaviors unique to the sanctions provision (e.g., completing 1-9 verification forms for only foreign-appearing persons). 

GAO’S survey questions were directed to employers’ adoption of specific 

hiring practices. The questions avoided any implication regarding the 

legality or illegality or fairness or unfairness of their practices. In partitular, the word discrimination was not used. 

We consulted a panel of outside experts to comment on our questionnaire and other methodologies used during our review. Stanley Presser, 

a noted expert in survey design, was a key consultant in developing the 

questionnaire. He is the Director of the Survey Research Center at the 

University of Maryland. Eugene Ericksen, Temple University, assisted 

in the sampling design. Other expert consultants included Frank Bean, 

Urban Institute; Barry Chiswick, University of Illinois at Chicago; Doris 

Meissner, Carnegie Endowment for International Peace; David North, 

New Transcentury Foundation; and Marta Tienda, University of 

Chicago. 

We made every effort in the survey to obtain only information on 

behaviors resulting from the law’s implementation. We conducted more 

than 60 pre-tests- an unusually large number-of the employer survey 

in five cities to ensure that employers understood the questions and 

could accurately report the reasons for their practices. We considered 

the possibility that some employers may use the law as a defense for 

discriminatory practices that pre-existed IRCA. However, there was no 

evidence from the pretest to indicate that employers were using the new 

law as a defense against discriminatory behaviors that existed before 

the law. We also included explicit language in the questionnaire that 

linked behaviors to IRCA. For example, in one question (question 23) the 

question includes (1) the phrase “as a result of your firm’s understanding of the 1986 immigration law” [underlining appears in questionnaire], 

Page 26 GAO/GGD90-62 Employer Sanctions 
Chapter 2 

Objectives, Scope, and Methodology 

(2) instructions, set off in a box, that read “IMPORTANT: CHECK ‘YES’ 

ONLY IF ACTION TAKEN WAS A RESULT OF THE 1986 IMMIGRATION 

LAW,” and (3) “Began” at the beginning of each item relating to discrimination to denote new behavior since the law. 

loyer Survey We surveyed a stratified random sample of 9,491 employers nationwide 

to obtain data on the law’s implementation. In reporting the results, we 

divided the country into eight areas: (1) Los Angeles; (2) New York City; 

(3) Chicago; (4) Miami; (5) California, except Los Angeles; (6) Texas; (7) 

rest of the west; and (8) rest of the United States.” We also selected 

employers in each area according to three approximately equal levels of 

ethnic composition-those industries with high, medium, and low levels 

of Hispanic and Asian employees as determined by the 1980 U.S. census, 

We hypothesized that employers’ knowledge and compliance with the 

law may vary depending on the number of Hispanics and Asians they 

employ. 

We also selected a separate sample of agricultural employers. We 

thought their knowledge and compliance with the law might be different 

from those of other employers because the law exempted employers of 

seasonal agricultural employees from the sanctions provision until 

December 1, 1988. However, agricultural employers represented only 

about 1 percent of our universe, and for most of the analyses presented 

in this report employers in the agricultural strata generally responded 

the same as other employers, Consequently, the employer responses for 

the agricultural strata are not reported as a separate analysis but are 

always in the total. 

Although the antidiscrimination provision exempts employers with 

fewer than four employees, we are reporting the discrimination by 

employers with one or more employees because all employers are subject to the sanctions provision. 

In late April 1989, we mailed our questionnaire to 9,491 employers 

selected from a private firm’s list of approximately 5.5 million employers. Those employers who did not respond were mailed a second questionnaire in June. During August 1989, we telephoned employers who 

still had not responded and sent those who agreed to respond a third 

questionnaire. 

‘The rest of the west includes New Mexico, Arizona, Colorado, Hawaii, Alaska, Idaho, Montana, 

Nevada, Oregon, IJtah, Washington, and Wyoming. 

Page 27 GAO/GGD-90452 Employer Sanctions 
Chapter 2 

ObJectives, Scope, and Methodology 

The original sample of 9,491 was reduced to an adjusted sample of 6,317 

employers because (1) some were out of business or could not be located 

or (2) they had no employees or hiring was done elsewhere. (See table 

2.1.) 

Sample 

Out of business/could not be located 

Hiring elsewhere/no employees 1,458 

Total unusable 3,174 

Adjusted sample 6,317 

When data collection ended in September 1989,4,362 employers (69 percent of the adjusted sample) had returned usable responses. The 0.9 million difference from the 5.5 million in our original universe is our 

estimate of the number of employers in the universe who had no 

employees or whose hiring was done elsewhere. Further, in making our 

projections to 4.6 million employers, we assumed nonrespondents would 

have answered the survey as our respondents did. (See app. III for 

details.) 

To encourage honest responses, we did not ask for employer names and 

guaranteed anonymity for their responses. We included a numbered 

postcard with each (unnumbered) questionnaire, which employers were 

instructed to mail separately from their completed questionnaire. The 

number on the postcard corresponded to the identity of the employer. 

When we received the postcard, we counted the employer as having 

mailed the completed questionnaire. 

The sampling plan was designed so that estimates from 95 of every 100 

samples selected in this way would not differ by more than +- 5 percent 

from the true population values. Although our survey results are representative of 4.6 million US. employers, the results have certain limitations.zl (See app. III for a full discussion of sample selection and sampling 

errors; app. II for questionnaire results.) 

“The results are based on weighted data. The weights are calculated as the ratio of the universe 

divided by the sample for each stratum. The estimated numbers and percents cited in the text of the 

report do not necessarily correspond to the number and percents listed in appendix II. The numbers 

shown in the appendix are based on those who responded to each item. The estimates in the text 

relating to discrimination are based on responses to more than one question, and arc generalized to 

the entire universe of 4.6. million employers. As noted earlier, we made the assumption that rcspondents who did not answer any of the discrimination practice questions did not engage in discriminatory practices. 

Page 28 GAO/GGD-90-62 Employer Sanctions 
--f------ 

-- 

A different kind of bias would result if respondents who did not understand the law were motivated by a desire to give what they thought was 

the socially acceptable response. For example, respondents might incorrectly understand the law as requiring them to hire only U.S. citizens. 

They might therefore report that they hired only U.S. citizens, even if in 

fact they did not. Respondents might also have other misconceptions 

about the law. This type of bias could cause the survey results to overestimate or underestimate the incidence of discrimination. 

-__. ._. -. 

Hir i$q!, Audit 

Chapter 2 

Objectives, Scope, and Methodology 

In addition to sampling errors, survey results are subject to different 

kinds of systematic errors, or bias. For example, it is possible that some 

respondents who were engaging in behavior illegal under the law would 

not report, or would underreport the extent of, such behavior. This kind 

of bias would result in an underestimation of illegal behavior. Alternatively, some respondents might have falsely reported that they engaged 

in discriminatory practices in hopes that such responses might lead, 

through a GAO finding, to the repeal of employer sanctions. This kind of 

bias would lead to survey results overstating the extent of 

discrimination. 

Survey results are also subject to nonresponse bias. Nonresponse bias 

occurs to the extent the answers that would have been given by 

nonrespondents differ from those given by respondents. It is likely that 

at least some employers not conforming to the law would decide not to 

respond to our survey rather than lie about their behavior or report illegal behavior. To the extent this occurred, the survey results would 

underestimate the extent of IRcA-related discrimination. In addition, survey respondents might decide not to respond for a wide variety of reasons. It is not possible to assess the effects of this type of bias on the 

results of this survey. 

We did a hiring audit to directly observe whether employers treated foreign-looking or foreign-sounding job applicants differently. Specifically, 

we wanted to know whether persons who look and/or sound foreign 

were: (1) more likely to be asked for documents, (2) asked to show documents earlier in the hiring process, (3) not allowed to proceed as far into 

the hiring process, and (4) likely to receive fewer job offers. 

Page 29 GAO/GGD-90-62 Employer Sanctions 
- 

, 

Chapter 2 

Objectives, Scope, and Methodology 

--rThe hiring audit was done under contract with the Urban Institute in 

Washington, D.C.4 The Urban Institute recruited 16 college students 

(called testers) to apply for jobs in Chicago and San Diego. All testers 

were men between the ages of 19 and 24. They were matched as closely 

as possible on (1) education, (2) work experience, and (3) oral communication skills. Testers’ biographies were modified to match work-related 

qualifications and make their qualifications typical of most young adult 

jobseekers. Testers were instructed to give similar answers to various 

questions the employer might ask. We attempted to ensure that both 

members of each pair would appear closely matched on job qualifications. The only significant difference was that one member was foreignlooking and foreign-sounding and the other was not. Although each pair 

was closely matched on all employment-relevant characteristics, we cannot rule out the possibility that differences in hiring outcomes between 

testers stemmed from factors other than national origin. Thus, we cannot be certain that if an individual employer did not offer a job to a 

tester, that the employer was discriminating. However, if the aggregate 

results show a pattern of Hispanic testers not being offered jobs, we 

believe this indicates national origin discrimination. Other limitations to 

the hiring audit are discussed in appendix III. 

Before applying for jobs, the 16 testers (8 in each city) received 2-l/2 

days of training. After training, they were assigned to pairs (four pairs 

in each city). Each pair consisted of an Anglo and a Hispanic.” Each 

member applied for the jobs first half the time. The four pairs in Chicago applied for 169 jobs advertised in the Sunday Chicago Tribune, and 

the four pairs in San Diego applied for 191 jobs advertised in the Sunday 

San Diego Union. The jobs generally called for low-skilled, entry-level 

applicants and usually required no more than a high school education 

(e.g., management trainee, waiter). The testers were slightly overqualified for these jobs since their resumes indicated they all had at least 1 

year of college education, The hourly wages offered for most jobs 

ranged from $3.75 to $7.50 per hour. 

The first step in applying for each job was for each pair of testers to 

telephone or visit the employer listed in the advertisement and apply for 

“The IJrban Institute staff who worked with GAO to plan and implement the hiring audit were Harry 

Cross, Kesearch Associate; assisted by Jane Mell, Genevieve Kenney, and Wendy Zimmerman. See 

Employer Hiring Practices: Differential Treatment of Hispanic and Anglo .Job Seekers, IJrban Institute 

Report No. 90-4, (Washington, DC: IJrban Institute Press). 

“Hispanics were chosen for the audit because both Congress and minority interest groups felt this 

segment of the population was at the greatest risk of discrimination as a result of IRCA’s new 

procedures. 

Page 30 GAO/GGD-90-62 Employer Sanctions 
Chapter 2 

Objectives, Scope, and Methodology 

the job. Each tester applied separately and recorded the employer’s 

observed behavior on a data collection form immediately afterward. If 

asked, each tester provided the employer with the same type of identity 

and work eligibility documents- a driver’s license and a Social Security 

card. 

If asked to complete a job application or the I-9 form, each tester checked 

the “citizen” box. As a result, we believe the hiring audit measured discrimination based only on the testers’ foreign appearance or accent (i.e., 

national origin). To measure citizenship discrimination, testers would 

have had to check the “alien” box on job applications or present work 

eligibility documents issued by INS. 

Testers also gave the employer a phone number to call for more information or to offer a job. Employers calling these numbers heard a 

recorded message from a person identified as a relative of the tester asking them to leave their name, number, and a brief message. The appropriate tester returned the employer’s call and recorded what the 

employer said on a form. In order to provide each tester in a pair with 

an equal opportunity to receive an interview or job offer, any tester 

with a job offer immediately turned it down, If the employer did not 

leave a message on a tester’s answering machine within 2 or 3 days after 

the tester applied or interviewed for the job, that tester called the 

employer and asked about the status of his application. After these 

phone calls, the audit of an individual employer was then generally considered complete. A total of 360 hiring audits were done in the two cities. The results of the hiring audit are not generalizable to the Nation. 

After the audit was completed, we mailed the 360 employers a copy of 

our employer survey questionnaire so that we could compare their 

observed behaviors with their written responses to the discrimination 

questions in the survey. This was an attempt to determine to some 

extent whether (1) the behavior we observed during the audit resulted 

from the sanctions provision and (2) the employer survey estimates of 

the level of discrimination were different from what they would have 

been had we actually observed the behaviors of all employers surveyed. 

Unfortunately, we were unable to use the data from this survey effort 

because the respondent to this questionnaire may not have been the 

same person observed in the hiring process, and the number of respondents was not sufficient to allow for a meaningful analysis of the 

responses. 

‘ Page 31 GAO/GGD-90-62 Employer Sanctions 
Chapter 2 

Objectives, Scope, and Methodology 

Jo1 “I ’Applicant Survey We surveyed foreign-sounding and non-foreign-sounding job applicants 

who had applied for a job since January 1, 1989, to determine if the 

sanctions provision was causing employers to treat foreign-sounding 

applicants differently from those with no accent (i.e., national origin discrimination). For example, if we found employers were more likely to 

apply work verification requirements (e.g., completing an 1-a form) to 

only foreign-sounding applicants, this would constitute evidence of discrimination that resulted solely from the sanctions provision. 

We visited organizations in Los Angeles, Miami, Dallas, Chicago, and 

New York City that were providing educational services to temporary or 

permanent resident aliens. At these organizations, we were able to locate 

150 people meeting our criteria who were willing to complete our survey. We compared those results with the results from 150 persons (all 

US. citizens) with no foreign accent at state employment agencies in 

those cities who also had applied for a job in person since January 1, 

1989. The comparison, however, must be interpreted cautiously because 

the participants were not randomly selected, and the results cannot be 

generalized. Further, the participants applied for different types of jobs, 

and heard about the job openings from different sources (e.g., friends 

versus newspapers). We asked only about the applicants’ most recent 

job application experiences. (See app. V.) 

The following table shows the status and location of each person who 

completed the survey. 

Table 2.2: Location and Citizenship 

Statys of Job Applicants Surveyed Temporary Permanent 

Location resident alien resident alien U.S. citizen ______..__ __.. ---.__ 

Miami” 23 5 30 ~____..__ ---- 

Los Angeles 30 0 30 .__I_~--. - ______ 

Chicago 26 4 30 

New York 2.5 5 30 “____._ _.-_--.~ _._ -~--.- -_____- 

Dallas 23 7 30 __ ____- .- -.-~ 

Total 127 21 150 

“The numbers for Miami do not include one person whose immigration status was not known and 

another person who had received polittcal asylum. 

State Employer Service 

Placements * 

If implementing employer sanctions caused a pattern of discrimination, 

it might be reflected in state employment service placements of Hispanics and other minorities compared to placements of Anglos and blacks. 

For this reason, we analyzed state employment service placement data 

Page 32 GAO/GGD-90-62 Employer Sanctions 
Chapter 2 

Objectives, Scope, and Methodology 

from 1982 to 1989-before and after IRCA’S enactment in 1986. The 

number of placements per year from 1982 to 1988 ranged from 108,661 

to 606,200 in the states for which we analyzed job placement rates 

(Florida, Illinois, and Texas). We limited our analysis to three statesFlorida, Illinois, and Texas. New York and California were not included 

because state employment service officials in these states said that comparable pre- and pOSt-IRCA data were not available. 

EEO!C Data Analysis 

I 

I 

We obtained a set of reports from EEOC that included information for the 

period October 1978 through May 1989. These reports showed the issue 

for filing as well the basis for the complaint. Issues were categorized 

into-hiring, discharge, layoff, and other. Race and national origin were 

defined as follows: Hispanic, Hispanic/Mexican, Asian, black/Hispanic, 

black/other, black, white, other national origin, other combination, and 

other single. We were not able to verify the accuracy of the data 

supplied. 

The data was first arrayed according to year, issue, and basis (race or 

national origin). Percentages were then computed to identify the presence or absence of a discernible trend. 

Antilysis of OSC Charges Justice’s Office of Special Counsel (osc) enforces IRCA’S antidiscrimination provision. As of October 30, 1989, osc had received 708 charges. 

We analyzed 415 discrimination charges filed with osc from May 2, 

1988, to May 1, 1989, to evaluate the types of allegations filed and identify those that related to the sanctions provision. To do this, we used 

criteria similar to EEOC’s criteria, which were established in March 1987, 

for identifying IRCA-related charges. Specifically, charges are IRCArelated if (1) employers either have refused to hire or have fired people 

because of immigration status, (2) employers refused to accept documentation for authorization to work, (3) employers appeared to have a 

policy to hire only U.S. citizens, and (4) employers asked only the job 

applicants or current employees who looked or sounded foreign to prove 

they were authorized to work in the United States. 

Page 33 GAO/GGD9082 Employer Sanctions 
Chapter 2 

Objectives, Scope, and Methodology 

[ow We Defined We decided that carrying out the sanctions provision satisfactorily 

meant, at a minimum, that INS developed plans and policies and implemented procedures that could reasonably be expected to (1) educate 

employers about their requirements under the law and (2) identify and 

fine violators. We applied the same standard to Labor, with the exception of fining employers. 

The standard for “satisfactory” does not include factors beyond the 

government’s control, such as those that could increase illegal immigration despite IRCA. An example is conflict in Central America, which could 

result in more illegal immigration than existed before the law. Also, the 

law would still be carried out satisfactorily even if it caused employment discrimination, provided that the government had made reasonable efforts to educate employers about the law. 

M$thodologies Used to 

D&ermine Whether the 

Sainctions Provision Was . 

“C!arried Out 

Satisfactorily” . 

. 

. 

. 

To determine whether the sanctions provision had been carried out satisfactorily, we 

surveyed a random sample of employers to determine their knowledge 

of, and compliance with, the sanctions provision; 

reviewed a random sample of INS case files of employers who had been 

fined for violating the sanctions provision; 

examined INS and Labor data on employer compliance with the sanctions 

provision; 

evaluated the INS program of random employer compliance inspections 

to determine whether it was accomplishing its objectives; and 

interviewed INS and Labor officials concerning the policies and procedures for educating employers and enforcing the sanctions provision. 

To determine whether INS field offices were satisfactorily implementing 

the INS Commissioner’s enforcement policy, we reviewed a random sample of INS case files of employers who had been fined for violations. We 

selected 300 cases from the 704 case files that were closed from July 1, 

1988, to February 28, 1989. INS considers a case closed when the 

employer and INS reach a settlement on the penalty for the violation or 

the employer has failed to respond to, or exhausted all rights to appeal 

INS’ notice Of intent to fine. 

To determine the extent to which employers were aware of and in compliance with the law, we examined our survey results along with INS and 

Labor data on their efforts to enforce the law. Specifically, we analyzed 

Page 34 GAO/GGDSOS2 Employer Sanctions 
Chapter 2 

Objectives, Scope, and Methodology 

employers’ responses to our survey questions about their awareness of 

the law, as well as their compliance with the I-9 form requirement. 

To understand how the law was being implemented, we interviewed federal, state, or private officials primarily in high alien population citiesWashington, D.C., Chicago, Dallas, Los Angeles, Miami, and New York 

City-where we believed the law could have a disproportionate effect 

because of the large number of resident aliens. We also visited INS offices 

in El Paso, McAllen, and Harlingen, Texas, as well as Cleveland, San 

Diego, New Orleans, and Baltimore. 

Ho+ We Defined 

Unqecessary 

Regulatory Burden 

IRCA directed us to review the implementation of the sanctions provision 

to determine if it has caused an unnecessary regulatory burden on 

employers. The primary burden on employers is preparation of the r-9 

forms. In the absence of further congressional guidance, we decided that 

the regulatory burden would be unnecessary if the law failed to achieve 

its objectives, which are to reduce illegal immigration to the United 

States and to reduce unauthorized alien employment. 

The law could fail to reduce unauthorized alien employment if aliens use 

fraudulent or counterfeit documents to circumvent the law’s eligibility 

verification system. Employers who knowingly employ unauthorized 

aliens can be sanctioned for hiring or continuing to employ unauthorized 

aliens. Generally, INS cannot sanction any employer who hires an unauthorized alien if the alien was able to complete the form I-9 by presenting 

the employer with fraudulent or counterfeit documents that appeared 

genuine. 

MetPodologies Used to 

Deteirmine Whether the 

To determine whether the sanctions provision has caused an unnecessary regulatory burden on employers, we 

Sanctions Provision Has 

Caubed an Unnecessary l included questions on our employer survey about (1) the time required 

Regulatory Burden 

to complete the I-9 form, (2) whether any job applicants presented fraudulent or counterfeit documents, and (3) whether the sanctions provision 

has effectively reduced unauthorized alien employment; 

. obtained INS data on the number and types of fraudulent or counterfeit 

documents presented to employers by unauthorized aliens who were 

apprehended at work; and 

. analyzed data from INS and other organizations that could show whether 

reductions in illegal immigration or unauthorized alien employment 

have occurred (e.g., alien apprehensions at the U.S. border). 

Page 35 GAO/GGD-9042 Employer Sanctions 
Chaptar 2 

ObJectives, Scope, and Methodology 

Ptivate Groups’ Use of 

Discrimination 

P#otection to Harass 

E ’ 

m 

ployers 

IRCA also directed us to review the implementation of the sanctions provision to determine if the antidiscrimination provision resulted in frivolous lawsuits being brought against employers by private groups. The 

legislative history shows that congressional conferees were concerned 

that such suits would result in an “unreasonable burden” and might 

occur if private groups used the expanded antidiscrimination protection 

in IRCA to harass employers. 

Therefore, our determination focused on whether the antidiscrimination 

section is a vehicle for harassing employers. To make this determination 

we needed a two-step approach. First, we analyzed the number of complaints that have been brought under the antidiscrimination provision to 

determine whether private groups had filed a significant number of 

complaints. Second, if a significant number of complaints had been filed, 

we would review the cases to determine whether it appeared that 

employers were being harassed. Appendix IV contains a more detailed 

discussion of this issue. 

M&thodologies Used to 

D&ermine Whet her 

Private Groups Harassed 

Employers 

To determine whether private groups used the law’s discrimination protection to harass employers, we reviewed discrimination complaints 

received by osc and EEOC that were filed by private groups on behalf of 

the complainant. 

Agency Comments We discussed our methodologies and approaches with agency officials 

and took their comments into account in refining our methodologies. 

We kept the affected agencies apprised of the substance of our work 

through periodic briefings, but we did not seek formal comments on our 

draft report from them. Our principal findings on discrimination were 

entirely dependent on data we generated from sources other than facts 

developed by, or in the possession of, these agencies. We discussed our 

tentative conclusions with key Justice Department officials. We did our 

work between November 1988 and February 1990, and in accordance 

with generally accepted government auditing standards. 

Page 36 GAO/GGDSO82 Employer Smctiona 
Chapter 3 

Di.&riminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

Congress has mandated that GAO determine whether widespread discrimination has resulted solely from the law. As discussed in chapter 2, 

making the link between discriminatory practices and the law is exceedingly difficult. We used various techniques and approaches to try to 

measure the discrimination and determine the link. None of these techniques or approaches could have been ideal. But, we believe they are 

sufficient for us to conclude whether there was discrimination as a 

result of IRCA. 

We developed and used six different methods to obtain information on 

discriminatory practices and their relationship to the law. On the basis 

of the data from the first method-the employer survey-the national 

origin discriminatory practices reported do establish a widespread pattern of discrimination. This pattern existed across a variety of industries in all areas of the Nation and among employers of various sizes. 

Further, it is more reasonable to conclude that a substantial amount of 

the discriminatory practices resulted from IRCA rather than not. 

The results of the next three methods-the hiring audit, our survey of 

300 job applicants in five cities, and our analysis of over 400 discrimination charges filed with osc-further support our widespread pattern 

determination. Our final two methods-the analysis of job placement 

rates before and after IRCA in state employment agencies and an analysis 

of data on discrimination charges filed with EEOC before and after IRCAdid not detect evidence of a widespread pattern. However, we believe 

various factors in the data masked the employment discrimination 

found with our other methods. 

The law allows us to include citizenship discrimination in our determination of whether the law resulted in a “widespread pattern of discrimination” only if we can determine such discrimination also resulted in 

national origin discrimination (see app. IV). However, we could not 

determine conclusively the extent to which the citizenship discrimination also amounted to national origin discrimination. Therefore, we did 

not include citizenship discrimination in our determination of a widespread pattern. Our determination rests solely on our findings regarding 

national origin discrimination. Nonetheless, this chapter reports data on 

both types of discrimination because we know that the total amount lies 

between the total for national origin discrimination alone and the total 

for national origin and citizenship discrimination combined. Our survey 

results suggest that persons of Hispanic and Asian origins may have 

been harmed by employers’ citizenship discrimination practices. 

Page 37 GAO/GGD-90-62 Employer Sanctions 
Chapter 3 

Discriminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

E&o” vers ReDort 

Di&irkinator; Practices 

Re $ ulting From the Law 

The results of our survey of a random sample of the Nation’s employers 

show that an estimated 891,000 employers (19 percent) of the 4.6 million in the population surveyed reported beginning discriminatory practices because of the law.’ Of these, an estimated 

* 461,000 employers (or 10 percent) discriminated on the basis of a person’s foreign appearance or accent (national origin discrimination),” and 

. 430,000 employers (9 percent) discriminated only on the basis of citizenship status. 

Some respondents failed to answer particular questions. To be conservative in our estimates of discrimination practices, we made the assumption that nonrespondents to questions on discrimination did not 

discriminate. However, it is possible that some of these nonrespondents 

chose not to answer the questions because they were reluctant to disclose that they engaged in discriminatory practices. To the extent that 

nonrespondents to individual questions engaged in discriminatory practices, our estimates are understated. 

The 461,000 employers reported hiring an estimated 2.9 million employees at their locations during 1988 and the 430,000 employers reported 

hiring an estimated 3.9 million employees. 

In the four highly Hispanic and Asian cities surveyed, many employers 

reported beginning one or more discriminatory practices: 29 percent in 

Los Angeles, 21 percent in New York City, 19 percent in Chicago, and 18 

percent in Miami. However, the employers who began discriminatory 

practices were not confined to those cities; for example, 17 percent of 

the employers in the states that we have grouped as “the rest of the 

‘All estimates are made at the 96 percent confidence level plus or minus 5 percent unless otherwise 

noted (see app. III). Also, estimates and percentages for the employer survey have been rounded. 

“Data include employers who reported only national origin discrimination practices, as well as those 

who reported both national origin and citizenship discrimination. Furthermore, this includes an estimated 56,000 employers who responded that they did not hire persons who presented Puerto Rican 

birth certificates. We believe employers responding to this question were reacting to the appearance 

or accent of the persons and were unwilling to accept a valid work eligibility document. 

Page 38 GAO/GM%9082 Employer Sanctions 
Chapter 3 

Discrlmina~ry Practices Widespreti A 

Substantial Amount bsulted From the Law 

United States” also reported beginning discriminatory practices. (See 

fig. 3.1.) 

Our estimates of discriminatory practices are based solely on employer 

responses to the survey questions shown in table 3.1. The table also 

shows which questions relate to national origin and citizenship discrimination. Because many employers surveyed reported more than one discriminatory practice, the number of employers in the following 

discussions who adopted different types of discriminatory practices, if 

totaled, exceed the number (891,000) of employers who reported one or 

more discriminatory practices. 

.l: GAO’s Employer Survey Questions on National Origin and Citizenship Discrimination 

lmport~nt: Check “yes” only if action wa 

. . I -....._ ._____~ 

Discr4lf\ination questions 

,, ,,, .,I ratiuli of the I@$$ immlp3ti6n law, ,).,), )(),,.,( ,, 

Type of question 

1 Whidh of the following actions, if any, were taken at this location as a result of your firm’s understanding of 

--- 

the 1986 lmmigratron law? (Question 23 on the survey.) Actions taken 

a Began to hire only persons born in the United States 

b. Began a practice to not hire persons who have temporary work eligibility documents (for example, 

temporary resident aliens) 

Citizenship 

Citizenship 

c. Began to examine documents of only those current employees whose foreign appearance or accent 

le$ the firm to suspect they might be unauthorized aliens 

National origin 

d. Began a practice to not hire job applicants whose foreign appearance or accent led the firm to suspect 

they might be unauthorized aliens 

National origin 

e. Began a practice to not hire persons who present Puerto Rican birth certificates National origin 

-____-.-__~ .______ -~- 

2. Which of the followrng reasons, if any, explains why l-9 forms were completed for some of the employees National origin 

hrreql In 1988 but not for others? (Question 4.2.) 

Response #2: Only completed l-9 forms for persons who were suspected of being unauthorized aliens 

because of foreign appearance or accent 

._____- -.____.. 

3. Which of the following reasons, if any, explains why your firm looked at job applicants’ work eligibility National origin 

documents before making a job offer? (Question 7.3.) 

Response #3: Applicant’s foreign appearance or accent made the firm suspect the person might be an 

unaiLthonzed alien 

Page 39 GAO/GGD-90-62 Employer Sanctions 
Chapter 3 

DLcriminatory Practices Widespread; A 

Substantial Amount Resulted From the l;rrw 

Fig&e 3.1: Levels of Discrimination Across the Nation 

I/ , 

n- - 

- I 

A-. 

Ad& fg 

Chicago ,,-“’ 

A 

•j 

New York City 

- Rest of the 

United States 

Miami 

Source: GAO Employer Survey, 1989. 

Page 40 GAO/GGD-90-62 Employer Sanctions 
- 

Chapter 3 

Discriminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

An estimated 227,000 employers (or 5 percent) of the 4.6 million in the 

nship Discrimination population we surveyed reported that as a result of IRCA, they began a 

practice to not hire persons because of foreign appearance or accent 

(national origin discrimination-questions Id and le).:] This varied from 

3 percent in Miami to 9 percent in Texas, as shown in figure 3.2. While 

we cannot estimate how many job applicants were affected, these 

employers reported hiring an estimated 1.1 million employees in 1988? 

Figure .2: Employers Who Said They 

Did No P Hire Persona Because of Their 

Foreige Appearance or Accent 

, 

26 Percentage 

20 

15 

10 

5 

0 r 

Goognphlc Citlw and Regions 

Note: Numbers used to generate this figure can be found in table 111.3. 

Source: GAO Employer Survey, 1989. 

An estimated 346,000 employers (8 percent) of the 4.6 million in the 

population reported that as a result of IRCA, they applied the law’s 

employment verification system only to foreign-looking or foreign- 

“Number and percentages for combined questions are based on t,he total universe of 4.6 million 

employers. Percentages for individual questions in appendix II are baaed on responses for each question, which varied. 

‘All references to “number of employees hired” do not include hires that occurred at locations other 

than the one to which we addressed our survey. 

Page 41 GAO/GGD-90-62 Employer Sanctions 
Chapter 3 

Dhcrlminat~ry Practices Widespread: A 

Substantial Amount Resulted Prom the Law 

sounding persons (national origin discrimination-questions lc, 2, and 

3). This varied from 6 percent in the “rest, of the United States” category (referred to as “Other States”) to 16 percent in Los Angeles, as 

shown in figure 3.3. While we cannot estimate how many job applicants 

were affected, these employers reported hiring at their location an estimated 2.2 million employees in 1988. 

Selective application of the law’s verification provisions is prohibited 

under IRCA. If foreign-appearing persons are asked to meet requirements 

that non-foreign-appearing persons are not required to meet, this can 

result in foreign-appearing authorized workers not being hired. For 

example, a foreign-appearing worker who, while eligible to work, did 

not have work eligibility documents readily available for an employer 

may be denied employment. However, a non-foreign-appearing person, 

also eligible to work, may be hired without having to present any 

documents. 

Figuh 3.3: Employers Who Said They 

Appl(ed the Law’s Verification System to 

Only,Foreign-Looking or Foreign- 25 Perwntago 

Souvding Persons 

20 

15 

10 

5 

0 rd \ A A 

Qoognphk Cltkm and Roglons 

Note: Numbers used to generate this figure can be found in table 111.3. 

Source: GAO Employer Survey, 1989. 

Page 42 GAO/GGD-90-62 Employer Sa.nctiona 
Ch&.er 8 

Discriminntir~ F’mcticm Widespreati A 

Subetantlal Amount Resulted From the Law 

An estimated 666,000 employers (14 percent) reported they began a 

practice to (1) hire only persons born in the United States or (2) not hire 

persons with temporary work eligibility documents (citizenship discrimination-questions la and 1 b) because of IRCA.~ This varied from 11 percent in Miami to 22 percent in Texas, as shown in figure 3.4. While we 

cannot estimate how many job applicants were affected, these employers reported hiring at their surveyed location an estimated 4.9 million 

employees in 1988. 

Began 10 Hire &I; U.S. Citizens and-Not 

Hire Pe/rsons With Temporary Work 

2~ 

Eligibility Documents 

20 

16 

10 

5 

Pmantago 

r 

Qmographlc CHb and Regions 

Note: Numbers used to generate this figure can be found in table III.3 

Source: GAO Employer Survey, 1989. 

Effect of Citizenship 

Discrimination on 

Hispanics and Asians 

Uncertain * 

The survey results suggest that persons of Hispanic and Asian national 

origins may have been harmed by employers’ citizenship discrimination 

practices. A greater proportion of employers who said they began to 

hire only persons born in the United States (citizenship discrimination) 

had no Hispanic or Asian employees. Seventy-six percent of employers 

“Data include employers who reported only citizenship discrimination practices, as well as those who 

reported both citizenship and national origin discrimination. 

Page 43 GAO/GGD-9042 Employer Sanctions 
Chapter a 

Discriminamry Practices Widespread: A 

Substmtial Amount Resulted From the Law 

said their understanding of IRCA caused them to begin hiring only U.S.- 

born persons reported having no Hispanic or Asian employees compared 

to 66 percent of employers who said they had not begun this practice. 

There was a greater difference among employers in heavily Hispanic 

and Asian areas-California, Texas, Chicago, Miami, and New York 

City. Fifty-four percent of these employers who said they began to hire 

only U.S.-born persons as a result of their understanding of IRCA 

reported having no Hispanic or Asian employees at the location surveyed compared to 38 percent for employers who said they had not 

begun this practice. 

Although these differences are statistically significant, we lack the 

information, such as the national origin composition of job applicant 

pools, that would enable us to determine the extent to which citizenship 

discrimination had the effect of national origin discrimination.” 

The rate of reported discrimination was about the same in industries Ihployers Reporting 

Discriminatory Practices employing low, medium, and high numbers of Hispanics and Asians. 

Were in Various Industries (See fig’ 3*5J 

and of’ Various Sizes 

“As discussed in chapter 2, our analyses are done at a 95 percent confidence level. 

Page 44 GAO/GGD-90432 Employer Sanctions 
Chapter 3 

Diecrlmi~tory Practices Widespread; A 

Substantial Amount Resulted From the Law 

Figure 

1 

3: Employers With National 

Origin nd Citizenship Discrimination 

Practlc 

t 

s by Levels of Hispanics and 

Asians, 

25 

20 

15 

10 

5 

0 

Pwcontago 

1 

Dfscrfmlnatlon 

1 1 Industries with High Proportion of Hispanics and Asians 

Industries with Medium Proportion of HIspanica ad Asians 

Industries with Low Proportion of Hlspanlce and Asinns 

Note: Numbers used to generate this figure can be found in table III.3 

Source: GAO Employer Survey, 1989. 

Also, employers of various sizes reported discriminatory practices, but 

those with 4 to 25 employees (i.e., medium-size employers) reported 

more discriminatory practices than other employers, as shown in figure 

3.6.7 

‘Employers with 4 to 25 employees represented 48 percent of the 4.3 million employer survey population that reported on the number of employees at their locations as of December 31, 1988. 

Yage 46 GAO/GGD90-62 Employer Sanctions 
- 

W 

Orl 

Prr 

Chapter 3 

Dfncrimina~ry Practices Widespread: A 

Substantial Amount Resulted From the Law 

Ire 3.6: Employers With National 

Iin and Citizenship Discrimination 

:tices by Number of Employees 25 

Numbor of Employre 

El 1 to 3 Employees 

4 to 25 Employees 

2f3 or more Employees 

Note 1: Numbers used to generate this figure can be found in table 111.3. 

Note 2: Based on the number of employers reported at their locations, as of December 31, 1988. 

Source: GAO Employer Survey, 1989. 

Hiiing Audit Shows 

Di$crimination Against 

Higpanics 

We conducted a hiring audit in which pairs of testers (a Hispanic and an 

Anglo in each pair) closely matched on those characteristics that might 

affect the hiring decision applied for jobs in two major job markets. In 

all likelihood, prospective employers were not aware that these “applicants” were testers. In this hiring audit, we observed 360 employers’ 

hiring practices in San Diego and Chicago to determine if foreign-looking 

or foreign-sounding persons were treated differently when seeking 

employment. 

As discussed in chapter 2, we attempted to match the pairs of Hispanic 

and Anglo testers on those characteristics that might affect the hiring 

Page 46 GAO/GGD-SO-62 Employer Sanctions 
Chapter 3 

Di~riminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

decision.” Although we audited only a small sample of employers in both 

cities, these employers are probably indicative of the urban job market 

situation currently facing young Hispanics and Anglos, because the positions were entry- level positions selected from a commonly used source. 

Hiri 

; 

g Audit Results Taken in the aggregate, the hiring audit results show a high level of 

national origin discrimination. We analyzed the testers’ progress at three 

different stages of the hiring process: (1) reaching the job application 

stage, (2) receiving a job interview, and (3) receiving a job offer. 

1 

I 

I 

Figure 13.7: Percentage of Audited 

Emplo)cers Who Favored Hispanics or 

Angles/ 

The hiring audit showed that the Hispanic testers were three times as 

likely to encounter unfavorable treatment when applying for jobs as 

were closely matched Anglos. (See fig. 3.7.) 

Anglos encountered unfavorable 

7 treatment 

No difference 

Hispanics encountered unfavorable 

treatment 

N460 

‘Some tester attributes, such as psychological traits that may affect employers’ treatment of job 

applicants, could not be adequately measured or included in the matching process. The hiring audit 

haa other potential biases. (See app. III.) 

Page 47 GAO/GGD-90-62 Employer Sanctions 
Chapter 3 

Discriminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

- 

Tab 

Flee 

Pro1 

It is unclear why 11 percent of the Anglo testers would encounter unfavorable treatment. Unfavorable treatment can result from systematic 

behavior, such as discrimination, or from random events, such as an 

employer’s bad mood. If we assume that all 11 percent is due to random 

events, then we would reduce the proportions for both groups by 11 percent. Subtracting this amount from both groups still leaves a 20 percent 

difference between Anglo and Hispanic testers. This difference is statistically significant at the -05 level.!’ 

The chance of a Hispanic encountering unfavorable treatment was 

higher in Chicago than in San Diego-33 percent and 29 percent, 

respective1y.l” 

Overall, Anglos received 52 percent more job offers than the Hispanics 

and 33 percent more interviews, as shown in table 3.2. 

3.2: Total Number of Testers 

Jng Significant Stages in the Hiring 

PS Stages Anglos Hispanics 

Anglo advantage 

over Hispanic (16) 

Completed an applicationa 342 327 5 

Received an interviewa 229 172 33 

Received a iob offerb 129 85 52 

“The universe is 360 audits 

“The universe is 302 audits 

The following are two examples where only the Anglo tester received a 

job offer. 

. A pair of testers applied for a job advertised in the paper as “counter 

help” at a downtown lunch service company. Both testers had similar 

work experience, although neither had experience in direct customer 

service. The advertisement said to apply in person, so the Hispanic tester went in to apply. When he entered, he told the manager that he 

would like to apply for the position. The tester reported that the manager studied him and then replied that the position was filled. The Anglo 

tester followed approximately 2 hours later. He also told the manager 

that he would like to apply for the position. The manager had the Anglo 

tester complete a short application, interviewed him for about 3 minutes, and offered him a job immediately. 

!‘The 95 percent confidence interval for the true difference in treatment (or net level of unfavorable 

treatment) is 0.14 to 0.26. 

“‘This is not a statistically significant difference at the .05 level. 

Page 48 GAO/GGD-SO-62 Employer Sanctions 
Chapter 3 

Discriminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

. A pair of testers applied for a position with a manufacturer that was 

listed under “shipping” in the Sunday Chicago Tribune. The advertisement specified that the company wanted a “dependable, hardworking 

person” and that applicants should contact “Bill.” The Hispanic tester 

called the specified phone number and, after inquiring about the job, 

was told by Bill that the position was filled. The Anglo tester called 15 

minutes later and Bill invited him for an interview for later that day. 

After a 15-minute interview, the Anglo tester was offered the position. 

The two testers phoned about the job in the same manner to the same 

person. The only discernible difference in the phone contact was the Hispanic tester’s accent. 

Even when testers reached the same stage in the hiring process, they 

sometimes still experienced different treatment from the prospective 

employers. For example, although both testers may have initially been 

offered the same job, the employer sometimes suggested to the Anglo 

tester that he might be able to advance to another job that paid more 

money or had greater status. II The following case is an example. 

l The Hispanic tester filled out an application for a busboy job and had a 

short interview. The interviewer described the basics of the job and the 

pay. The Anglo tester filled out the application and had a longer interview during which he was told that he could soon move up to a higher 

paying bartender position or even a position as a host if he worked well. 

This is a case where both testers reached the interview stage, but the 

employer showed clear preferential treatment to the Anglo. This type of 

preferential treatment is not included in the final results discussed earlier because both testers reached the same stage in the hiring process, 

To summarize, the hiring audit shows a high level of national origin discrimination in the two cities. To the extent that the sanctions provision 

did result in “new” discrimination, we believe it exacerbated an already 

serious problem of national origin employment discrimination. 

In addition, we believe the hiring audit results underestimate discrimination in the general population of employers for four reasons. First, 

past research shows that employers who advertise for job applicants in 

newspapers discriminate less than those who do not. Second, our testers 

stated on their job applications that they were U.S. citizens. Because 

they revealed their citizenship status early in the hiring process, the 

’ ’ In 14 audits employers treated the Anglo favorably compared to the Hispanic, and in 2 audits the 

employers treated the Iiispanic favorably at the same stage. 

Page 49 GAO/GGD90-62 Employer Sanctions 
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potential for citizenship discrimination was diminished. Third, our survey shows that employers with 26 or more employees reported less discrimination than employers with 4 to 25 employees. The employers in 

our hiring audit were larger than those in our nationwide survey. We 

estimate that 45 percent of the employers in the hiring audit had 50 or 

more employees compared to 18 percent of the employers in our survey 

who had 26 or more. Fourth, the job qualifications of our testers were 

probably better than the other job applicants who applied for jobs at the 

same employers. Better qualified job applicants would tend to be more 

attractive to employers who might otherwise discriminate against less 

qualified applicants. Specifically, our testers had at least 1 year of college, had 1 to 5 years’ work experience, and were all fluent in spoken 

and written English. In our opinion, we think it is reasonable to assume 

that, taken together, these four factors resulted in the hiring audit 

underestimating the amount of discrimination. 

National Survey Results on The type of unfavorable treatment we observed during the hiring audit 

Prqctice Not to Hire is similar to the behavior described in one of our survey’s national origin 

“Fweign-Appearing” discrimination questions. Our survey asked if, as a result of their underPer’sons standing of IRCA, employers “began a practice to not hire job applicants 

whose foreign appearance or accent led the firm to suspect they might 

be unauthorized aliens.” 

On the basis of the survey, we estimated that 209,000 employers (5 percent of the 4.6 million) began this type of discriminatory behavior and 

specifically attributed the behavior to their understanding of IHCA. Thus, 

while we cannot determine what factors led to the unfavorable treatment we observed during the hiring audit, we believe that some of the 

treatment can be attributed to the sanctions provision. 

Eniployers Applied the To determine if employers treated foreign-sounding persons differently, 

Lak’s Verification System we surveyed 300 job applicants (half said they sounded foreign, half did 

Differently for Foreign- not) in Chicago, Miami, Dallas, New York, and Los Angeles during July 

Sounding Job Applicants and August 1989.12 All 300 indicated they had applied in person for a 

job since January 1, 1989. 

Y 

The survey showed that employers applied the law’s verification system 

differently for foreign-sounding persons. (See fig. 3.8.) 

“The limitations of the job applicant survey are discussed further in chapter 2. 

Page 50 GAO/GGD-9062 Employer Sanctions 
Figu 

V&l 

Fore 

Chapter 3 

Discrhninatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

3.8: Employers Applied 

ation System Differently for 

n-Sounding Persona 100 Parcont 

Showsd 

Docummts and 

Not Offersd Job 

Asked For 

Documents 

During 

IIlbFhW 

Complatsd I-9 

Befors Hlrlng 

Applicant Exparlancss During Hiring Procsss 

Non-Foreign-Sounding 

Foreign-Sounding 

The verification system is unique to IRCA, therefore, any evidence showing that it is applied selectively for foreign-sounding persons constitutes 

new discrimination. That is, this selective application would not have 

existed without IRCA. 

This discriminatory behavior during the application stage may or may 

not result in discrimination during the hiring decision stage. Sixty-nine 

percent of the foreign-sounding applicants were offered the job compared to 40 percent of those with no accents. Because of certain sample 

selection biases, the job applicant survey cannot be used to show 

whether citizens with no foreign accents were more likely to be hired 

than foreign-sounding persons. As discussed in chapter 2, we selected 

our foreign-sounding individuals from organizations providing educational services to temporary resident aliens, and we selected citizens 

with no foreign accent from state employment agencies. Thus, we were 

more likely to encounter unemployed persons who had not been offered 

Page 61 GAO/GGD-90-62 Employer Sanctions 
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jobs in our citizen sample than in our foreign-sounding sample. This and 

other factors we could not control may explain why more of the foreignsounding aliens reported that they were offered a job than did the 

citizens. 

of OSC Charges 

About One-Fourth 

ear Sanctions-Related 

Justice’s Office of Special Counsel (osc) enforces IRCA’S antidiscrimination provision. As of October 30, 1989, osc had received 708 charges. Of 

these, we analyzed over 415 and found about one-fourth appeared to be 

related to employer sanctions. This provides additional evidence that 

some of the discrimination may have resulted from IRCA. 

Of the 415 charges reviewed, 114 charges alleged discrimination that 

appeared to be sanctions-related. The remaining cases did not appear to 

be sanctions-related or their nature was unclear because of insufficient 

information. Additional evidence could result in our reclassifying some 

charges. The most prevalent sanctions-related allegation was discrimination involving employer refusal to accept certain documents. (See fig. 

3.9.) 

Page 62 GAO/GGD-9042 Employer Sanctions 
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Flgur 

Alleg 

1 

3.9: Most Common OSC Charge 

s Employers Refused to Accept 

Docu entation 4% 

Only asked foreign-appearing for 

authorization 

Had a policy to hire only U.S. citizens 

116% 

25% 

f 

Refused to hire or fired person because 

ti 

of immigration status 

. . 

A Refused work authorization 

documentation 

N-114 

An osc official stated that many charges involved job applicants who 

apparently were not hired because employers did not understand what 

was acceptable proof of work authorization under IRCA. 

OS<; Activities From the law’s enactment until October 30, 1989, osc had received 708 

discrimination charges. I:) As shown in table 3.3, osc has closed more than 

half of the cases. For most of the closed cases, no formal finding of discrimination was made. 

“‘Includes at least 81 charges also filed with EEOC. 

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Table 3.3: Summary of OSC Charges 

Classification of charges 

Closed 

Number 

No discrimination founda 

Settlement reached’ 

Total ___-~- 

435 

83 

-- 

518 

Open 

More information needed 74 

Under investigation 105 

Filed with administrative law judge 11 

Total 190 

Total 708 

‘IAn OSC official reported these charges were not within OSC’s jurisdiction, determined charge 

unfounded, had insuffrcient data to investigate charge, or the charges were filed too late. 

“An OSC official reported these included civil monetary penalties against four employers. According to 

an OSC official, it is OSC’s policy not to seek penalties If a charge is settled prior to a complaint berng 

filed before an administrative law judge. The official stated that OSC always seeks monetary penalties if 

a charge IS ftled before an administrative law judge. 

Source: OSC. We drd not verify the accuracy or reliability of the OSC automated file on charges. 

0% is receiving more charges than it initially expected. An osc official 

estimated in June 1988 that osc would receive 310 discrimination 

charges during fiscal year 1989, but it received 385 charges. As shown 

in figure 3.10, the number of discrimination charges received by osc has 

leveled off recently, but an osc official expects an increase after a new 

public service announcement is shown that is designed to increase public 

awareness of the antidiscrimination provision. A similar public service 

announcement was aired in May and June of 1988, and the Acting Special Counsel attributed the increase in osc charges from July to September 1988 to that announcement. 

The number of osc charges is not large relative to the millions of jobseekers who might have been affected by IRcA-related discriminatory 

practices. In interpreting the osc data, however, we would make the following observations: 

. Not all those harmed by discriminatory practices realize that they have 

been harmed. For a person to file an osc charge, they must somehow 

become convinced that they have been unfairly treated. 

l Some job-seekers who might want to take action against perceived discriminatory practices may not be aware that osc provides an avenue of 

redress. 

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l Some of those who think they have cause to file a charge with osc may 

be deterred from doing so by the time, trouble, or legal expense 

involved. 

l The absence of a local osc field office might discourage some potential 

complainants. Where there is no local osc representative, a complaint 

must be filed by telephone or letter. 

. Some job-seekers may consider filing a charge but decide not to pursue 

the matter upon finding another, comparable job. 

These factors may explain why the number of complaints is low relative 

to the number of potential complainants. 

Figure/B.lO: OSC Charge Data Show Rise 

Follow ng April/June Public Service 

Annou: I: cement 159 Numbor of Chargea f?ocolved Quarterly 

149 

110 

199 

90 

80 

70 

89 

89 

40 

80 

20 

10 l-7 I 

O’ A L A A A L L 

Jul -Sop Ott - Jan - Apr - Jul - Sep Ott - Jan - Apr - 

87 IDlo Mar88 June8 88 Dec88 Mar89 Jun89 

QUMtW8 

Source: OSC 

Besides investigating charges, osc initiates independent investigations. 

Between March 15, 1988, and September 30, 1989, OX initiated 66 independent investigations as a result of self-initiated projects and leads 

from INS and Labor. The majority of these are still under investigation. 

(See table 3.4.) 

Page 55 GAO/GGD-90-62 Employer Sanctions 
Tab1 

lnve 

W 

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Discriminatory Practices Widespread: A 

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18 i lgatlons 

le 3.4: Summary of OSC Independent 

March 15, 1988, to 

te/mber 30,1989 

Classification of investigations Number 

Closed 

-- ---- 

No discrimination found 12 

-. -__I_ ---__ 

Settlement reached 1 -l_.- 

Company agreed to change its policy 1 

--. 

Total closed 14 

Under investigation 52 

Total ______--. ..- 66 

According to an osc official, osc estimates it will do another 75 investigations in fiscal year 1990. 

OS ($ Resources During fiscal years 1988 and 1989, osc generally received less funding 

than it requested. (See table 3.5.) 

Table 3.5: OSC Budget8 for Fiscal Years 

1988:to 1990 Dollars in millions 

Budget dollars 

1988 1989 1990 

~-.- 

0% submission to Justice 4.2 3.4 3.4 

President’s budget 

Funds appropriated 

4.2 2.8 2.6 

.-____- .___.. 

2.0” 2.1 3.5” 

‘OSC also had a $300,000 carryover from the previous year. 

“This includes an additional $1 million and three positions earmarked for publicizing the obligations of 

employers and the rights of job applicants under RCA’s discrimination prowsion. 

According to an osc official, the fiscal year 1990 funds of $2.6 million 

will enable the office to continue its primary mission of investigating 

charges and to initiate a small number of independent investigations. 

The Acting Special Counsel believes that independent investigations are 

important because they have the potential to correct some discrimination and deter more. However, he stated osc’s first obligation is investigating and litigating charges. 

Discrimination Charges During compliance inspections, INS and Labor can find possible discrimiReferred to OSC by Other natory employer practices, which they are supposed to report to OSC. As 

Agencies ’ of June 1989, INS had reported 28 allegations of discrimination to osc, 

and Labor, according to an osc official, had reported 14 such allegations 

as of September 1989. 

Page 66 GAO/GGD-90-62 Employer Sanctions 
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OSC and EEOC have referred charges to each other since the passage of 

IRCA. Officials from these agencies have signed a final memorandum of 

understanding, which became effective July 1989, specifying procedures for referring charges to each other. Two September 1989 reports 

showed EEOC had referred about 16 charges to osc and osc had referred 

at least 89 charges to EEOC. Some but not all of these are being investigated by both agencies. 

Otder Measures Do 

Notj Show IRCA 

Dis$rimination / / 

Statb Employment Service 

Pladement Rates Showed 

No Significant Differences 

We analyzed the rates at which Hispanics and other minorities found 

jobs through state employment services in three states-Florida, Illinois, 

and Texas-before and after the passage of IRCA. We found no significant differences in the trend data we collected from these states regarding service job placement rates from 1982 to 1989 for Hispanics and 

other minorities in relation to whites or blacks. A separate analysis for 

Tampa, Chicago, and Dallas/Fort Worth also showed no significantly 

different trends. These results cannot be generalized to other state 

employment services. 

We also found no significant difference in the placement rate for Puerto 

Ricans in New York City before and after IRCA. 

The fact that these analyses do not support our “widespread pattern” 

determination can be explained, we believe, by noting that employers 

who make use of state employment services as a source of applicants 

generally expect to find a high percentage of minorities among those 

applicants. Thus, as a category of employers, they may be less prone to 

discriminate than employers generally. 

EEOC Time-Series 

Analysis Showed No 

Apparent IRCJ-Related 

Trend 

We analyzed the flow of national origin discrimination charges into EEOC 

from fiscal year 1979 to May 1989 to see whether the number of these 

charges increased following IRCA. 

We found no significant increase in national origin charges filed with 

EEOC after IIZCA. Figure 3.11 shows the number of EEOC charges involving 

Page 67 GAO/GGD90-62 Employer Sanctions 
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Diecriminatmy Practices Widespread; A 

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employers firing, laying off, or not hiring persons because of their 

national origin or race from 1979 to May 1989. 

3.11: EEOC Complaints by 

yer Action Filed on the Basis of 

al Origin And/Or Race 18 Pmmt of Total Complaints 

Actlons 

- Discharge 

-1-1 Hiring 

- Layoff 

amma ouler 

Note 1: Due to an inability to obtain the data for each year separately, we combined data for 1979 

through 1984. 

Note 2: Includes only the first 6-month period for 1989. 

We do not believe this time series analysis is a sensitive measure of IRCAcaused discrimination, According to an EEOC official, the number of complaints filed with EEOC is dependent upon job applicants and employees 

knowing or believing that their lack of success in getting a job is the 

result of discrimination; it is unlikely that the passage of IRCA in itself 

would have an impact on these levels of knowledge or belief. 

Page 68 GAO/GGD-90-62 Employer Sanctions 
Cha: 

Figure, 

i 

Chapter 3 

Discriminatory Practices Widespread: A 

Substantial Amount Resulted From the Law 

;es Filed With EEOC As with osc, not all the EEOC national origin cases are related to IRCA. 

EEOC provided us with a listing of 168 cases that EEOC believed were possibly IRCA-related. These cases were opened between November 6, 1986, 

when IRCA was enacted, and September 15, 1989.14 As figure 3.12 shows, 

the number of IRcA-related charges being filed with EEOC has declined. 

12: EEOC IRCA-Related Charges Decline 

50 Nhbsr of Charges 

Curttar Ending 

Source: EEOC. 

Of the 168 EEOC IRCA-related charges, 64 allege employer refusal to 

accept documents and 59 allege discrimination on the basis of citizenship or immigration status, We did not have sufficient information to 

classify the remaining 45 IRCA-related charges. 

As of September 15, 1989, EEOC had closed 146 of the 168 rackrelated 

charges and of those, had settled 58 (40 percent). 

’ ‘Includes at kmt 81 charges also filed with OSC. 

Page 69 GAO/GGD-9082 Employer Sanctions 
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, Chapter 3 

Discriminatory Practices Widespread: A 

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Se/Vera1 Factors Lead We identified several possible reasons for IRCA-related discrimination: 

to ‘New Discrimination. a lack of employer understanding of the law’s major provisions, 

. employer uncertainty in determining work eligibility status, and 

. alien use of counterfeit or fraudulent documents that contributed to 

employer uncertainty about work eligibility status, 

I 

Oqerall Employer 

Ur/derstanding Has 

Dqclined 

A comparison of our 1988 and 1989 survey results indicates employer 

awareness of IRCA increased slightly (from 78 to 83 percent) but there 

has been a significant decrease in the percentage of employers who said 

they understood IRCA’S major provisions. (See fig. 3.13.) 

Page 60 GAO/GGD-90-62 Employer Sanctions 
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Discrlmi~tory Practices Widespread A 

Substantial Amount Resulted From the Law 

Figur 

Law I 

Unda 

3.13: Employer Awarenoes of the 

versed in lk39 but 

tanding of Sanctions Decreased 100 Penrnt 

90 

89 

70 

69 

59 

40 

30 

m 

10 

0 

Provldona of Law 

Source: GAO Employer Survey, 1988 and 1989 

As shown in figure 3.13, the proportion of the employers we surveyed 

who said they understood the I-Q requirement decreased by 31 percent, 

and the proportion of employers who said they understood the restrictions on hiring unauthorized workers decreased by 29 percent. According to INS officials, the education program’s effectiveness may have been 

hampered by decreased (1) education resources and (2) emphasis on INS 

personal visits as a method of educating employers. In June 1988, INS 

reduced the resources dedicated to education from 50 percent to 25 percent of its investigative resources. According to INS records, between 

December 1,1987, and September 30, 1989, INS spent over 950,000 

hours on education. 

Page 61 GAO/GGD90-62 Employer Sanctions 
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In addition, in both 1988 and 1989 our surveys showed that the smaller 

the employer the less often they said they were aware of the law and the 

less they understood IRCA’S sanctions provision. 

MO t Employers Want 

Sy i ,tem ImprovementsUntertainty May Have Led 

IRCA allows persons to use any of 17 different documents to establish 

work eligibility. (See fig. 3.14.) This multiplicity can give rise to confusion and uncertainty in the minds of employers seeking to confirm 

whether job applicants are eligible to work. To resolve this uncertainty, 

employers may choose to “err on the safe side,” and not hire foreignlooking or foreign-sounding applicants who are actually authorized to 

work. 

The majority of respondents to our survey indicated the need to improve 

the verification system. About 78 percent of all employers reported the 

need to reduce the number of documents or otherwise improve the system. Of these, 77 percent opted for one or more of the following ways to 

reduce the number of documents: 

Reduce the number of work authorization documents that INS issues. 

Make the documents INS issues the only work eligibility document aliens 

are permitted to present. 

Make the Social Security card the only work eligibility document persons are permitted to present. 

We performed tests of the total responses to see if the desire for 

improvement was more prevalent among those who said they discriminated than those who said they did not. Our results showed that a 

greater proportion of employers who discriminated as a result of the law 

than those who did not discriminate wanted either (1) additional methods to verify work eligibility or (2) to make the Social Security card the 

only approved document. (See fig. 3.15.) Between 16 and 19 percent 

more of the employers who discriminated wanted a better verification 

system than those who said they did not discriminate. These data suggest that some employers may have discriminated because they were 

uncertain about work eligibility status and chose to err on the safe side. 

Next, we tested the relationship between whether or not employers said 

they understood the law and their reported discriminatory practices. We 

found a statistically significant relationship in Los Angeles, Texas, and 

Page 62 GAO/GGD=90-62 Employer Sanctions 
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agricultural areas- areas constituting the highest reported discrimination. The percentage of employers who responded that they discriminated was 9 percent higher among employers who said they did not 

understand the law than among those who said they did. 

Page 63 GAO/GGD9062 Employer Sanctions 
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Discriminntory Practices Widespread! A 

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Fig --t-- 14: Some of the Documents Persons Can Use to Establish Work Eligibility 

Page 64 GAO/GGD-90-62 Employer Sanctions 
Figure 1 

Favor II 

System 

Chapter 3 

Diecriminatory Practices Widespread; A 

Substantial Amount &Bulted From the Law 

15: Employers Who Discrlminete 

provements to the Verification 

Wore Than Nondiscriminators loo 

so 

so 

70 

so 

So 

40 

30 

20 

10 

0 

Pwcont Favoring Actions 

Actlonr Empkyrn Want the Federal Government to Consldrr 

I Discriminators 

Non-discriminators 

Note: Numbers used to generate this figure can be found in table 111.3. 

Source: GAO Employer Survey, 1989. 

There are millions of aliens and citizens in the workforce who must have 

a Social Security number to report income earned from work. If parents 

have children they claim as dependents on their tax return, they must 

list the children’s Social Security number if they are age 2 or older. 

In December 1988, the Secretary of Health and Human Services sent a 

report to Congress pursuant to Section 101(e) of IRCA that discussed 

additional work eligibility verification methods for employers.15 The 

report concluded that a system to allow employers to validate job applicants’ Social Security numbers would have limited effectiveness in 

“A Social Security Number Validation System: Feasibility, Costs, and Privacy Considerations. Report 

of the Department of Health and Human Services Social Security Administration. Pursuant to Section 

(101)(e) of P.1,. 99-603, The Immigration Reform and Control Act of 1986, November 1988. 

Page 66 GAO/GGD-90-62 Employer Sanctions 
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Discriminatory Practices Widespreadz A 

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preventing unauthorized aliens from finding work. The primary reason 

for this conclusion was that because there is no photograph on the 

cards, no means would exist to ensure that the job applicant presenting 

a valid Social Security Account Number (SSN) card is the person to 

whom it was issued. 

If an SSN validation system is desirable, the Secretary suggested an alternative of prevalidating the SSNS on state driver’s licenses. The Secretary 

said that all state driver’s licenses include a photograph and 29 states 

also show the driver’s SSN. The report concluded that: 

“SSA currently validates SSNs in State driver’s license records for some States at 

their request and, if the States agreed, could validate SSNs at the time people initially applied for driver’s licenses. Such a procedure would positively link the SSN to 

the job applicant through the picture on the driver’s license, be less costly than a 

telephone validation system, and avoid placing the burden of validating SSNs on 

employers.” 

According to the Department of Transportation, an estimated 163 million persons had driver’s licenses as of December 31, 1988. 

Fraudulent and 

Counterfeit Documents 

Used by Aliens Contribute 

to Employers’ Uncertainty 

About Work Status 

In verifying whether job applicants are authorized to work in the United 

States, employers should review documents presented by the applicants. 

The verification, in effect, requires employers to judge whether or not 

the documents presented are obviously fraudulent or counterfeit.“’ 

A review of INS apprehensions of employed aliens during August and 

September 1989 suggests that counterfeit or fraudulent documents are 

common, adding to the uncertainty faced by employers in determining 

worker eligibility status. INS agents reviewed 110 alien registration cards 

and 166 Social Security cards and found the following: 

Ninety-six percent (106 of 110) of the INS-issued alien registration cards 

were determined to be counterfeit and 3 percent were fraudulent. The 

validity of one card could not be determined. 

Seventy-one percent (117 of 166) of the Social Security cards were 

determined to be counterfeit and 10 percent (16 of 166) were fraudulent 

cards. 

“‘A counterfeit document is one that is illegally manufactured, such as a fake Social Security card. A 

fraudulently used document is a genuine document that is illegally used (e.g., an alien using another 

person’s valid Social Security card) with or without alterations. 

Page 66 GAO/GGD-90-62 Employer Sanctions 
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Discriminatory Practices Widespread; A 

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The alien registration card and the Social Security card were the most 

common work eligibility documents. Together, they represented 76 percent of all the work eligibility documents that aliens used to complete 

the 1-9 verification. 

In addition, for the 222 apprehended unauthorized aliens who completed 1-9 forms, 127 falsely claimed to be permanent residents, 39 

claimed to be lawfully authorized to work, and 12 claimed to be citizens. 

In the remaining 44 cases, the aliens did not indicate their alien or citizenship status on the I-9. 

Some employers who responded to our survey also commented on the 

counterfeit document issue and the law’s eligibility verification system: 

“The ‘86 Immigration law is unworkable. Documents are easily counterfeited . . . the 

going price for a set of counterfeit documents that includes a SS [social security] 

card, INS work card and an Arizona driver’s license is $300-$500.” 

“There are definitely too many different combinations of documents that must be 

reviewed by the employer.” 

Effkts to Reduce 

IRCh-Related 

Discrimination Are 

Underway 

INS has initiated efforts to reduce the number of documents employers 

can use to verify the work eligibility of job applicants and employees. 

osc, INS, and other agencies are also engaged in efforts to educate 

employers on the anti-antidiscrimination-provision of IRCA. We believe 

these efforts need to be intensified if IRCA is to work properly. 

The iINS Decision to 

Redbce the Number of 

DocGments Should Help 

Redvce Employer 

Uncertainty 

As of February 1990, INS planned to standardize INS-issued work eligibility documents and eventually reduce from 10 to 2 the number of cards it 

issues.17 However, according to INS officials, final implementation will 

not occur before the mid-1990s and these planned time frames are contingent upon receiving additional funding, personnel, and data processing support. INS plans for the new cards to have counterfeit-resistant 

features and an expiration date. 

“In March 1988, we reported that there were too many different work eligibility documents to realistically expect employers to judge their genuineness. SSA officials are trained to detect fraudulent 

documents, but the Nation’s employers are untrained in document verification. We recommended that 

the Attorney General consider reducing the number of employment eligibility documents that could 

be used. One option was to make the Social Security card the only work eligibility document. (Immigration Control: A New Role For the Social Security Card, GAO/IIRD-88-4, Mar.. 16, 1988.) --.-.- 

Page 67 GAO/GGD-9082 Employer Sanctions 
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- 

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-_ 1 

The first new card is being issued to (1) all new permanent resident 

aliens, (2) those permanent resident aliens who have lost their cards, 

and (3) the children of permanent resident aliens when they re-register 

with INS at the age of 14. Approximately 2 million of these cards are 

issued annually. Beginning in fiscal year 1992, INS plans to begin replacing the estimated 20 million previously issued cards. 

The second new card will be issued to (1) nonpermanent aliens who are 

authorized to work and (2) nonpermanent aliens whose previously 

issued cards expired and who apply for renewal. INS also plans to recall 

and replace previously issued cards without expiration dates. INS 

expects to issue 1 million of these cards annually. This new card will 

replace several INS-issued documents that, according to INS officials, are 

not fraud-resistant, do not include a photograph, and are not easily 

verifiable. 

--.____- ~- 

Arptidiscrimination 

Education Activities 

Although IIXA does not require public education on the law’s antidiscrimination provision, OSC, INS, EEOC, and Labor have taken the initiative 

to educate the public about this IRCA provision. According to officials 

from these agencies, they have initiated both independent and joint programs and have been participating, along with the Small Business 

Administration (SBA), on a task force to discuss, plan, coordinate, and 

distribute educational material on the law’s discrimination protections. 

The agencies have funded initiatives within their existing budgets. The 

initiatives are directed toward three groups: (1) persons who may have 

been discriminated against (to make them aware of their rights under 

RCA), (2) persons at risk of being discriminated against, and (3) employers (to prevent or correct possible discriminatory practices). 

Since fiscal year 1987, osc and INS have distributed information handbooks to various agencies, employees, and employers and spoken before 

employer and employee rights groups about IRCA’S antidiscrimination 

provisionI As the lead agencies, osc and INS officials told us that their 

joint fiscal year 1989 initiatives included (1) a series of new public service announcements, (2) printing of 400,000 posters entitled “Important 

Notice Concerning Immigration-Related Unfair Employment Practices” 

in eight languages, (3) a “What You Should Know” informational poster 

targeted towards employers, (4) distribution of millions of copies of a 

‘“More inform&ion on OX’s and INS’ educational activities are in GAO’s second annual report, 

Immigration Reform: Status of Implementing Employer Sanctions After Second Year (GAO/ 

9 I - 16, Nov. 15, 1988.) 

Page 68 GAO/GGD-90-62 Employer Sanctions 
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brochure entitled Your Job and Your Rights in Spanish and English, and 

(6) newspaper advertisements in U.S.A Today and The Washington Post. 

In addition, EEOC, Labor, and SBA are informing the public by distributing 

INS and ox educational materials. 

In March 1989, the Attorney General acted on our recommendation 

regarding the development of a coordinated strategy for education by 

authorizing an antidiscrimination Task Force. Members of the Task 

Force include ox, INS, EEOC, Labor, and SBA. According to the Acting Special Counsel, the Task Force has (1) improved communications among 

these agencies on the initiatives that each one is undertaking, thus eliminating possible duplication; and (2) increased the number of agencies 

that distribute various educational materials. 

According to an osc official, OSC’S other fiscal year 1989 initiatives 

include (1) developing an illustrated magazine on IRCA; (2) preparing 

articles for newsletters published by the Department of Defense, Catholic Charities, and other interested organizations; and (3) signing agreements with state and local human rights agencies to allow each agency 

to receive the other’s charges. According to the Acting Special Counsel, 

osc’s antidiscrimination outreach activities focus primarily on potential 

victims of discrimination, but osc plans to direct future efforts toward 

employers, 

An EEOC official said that EEOC’S independent initiatives include: (1) 

speaking before conferences of state fair employment agencies, bar 

associations, and employer and civil rights groups; (2) issuing three policy guidance memorandums to its district offices on IRCA and its relationship to title VII of the 1964 Civil Rights Act; and (3) developing its own 

employee and employer booklets about unlawful discrimination under 

IRCA and title VII. 

According to an INS official, INS focuses on educating employers on IRCA’S 

antidiscrimination provision, INS officials stated their activities include: 

(1) informing employers in person, by telephone, or mail about the provision; (2) establishing an 800 phone number with an antidiscrimination 

message; and (3) distributing l-page flyers entitled “What Employers 

Should Know” and “Are You Facing Discrimination in Employment?” to 

employers and interested organizations. In addition, INS has hired a firm 

to develop and produce both electronic and printed antidiscrimination 

advertisements, and distributes Your Job and Your Rights and other IRCA 

information packets nationwide. According to an INS official, INS district 

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offices have produced public service announcements with local spokespersons, held antidiscrimination awareness meetings, and have done 

local advertising such as billboards with the antidiscrimination message. 

In addition, INS has held meetings in cities across the country and made 

announcements in the newspapers, on television, and on the radio to 

educate employers about the sanctions provision. According to our survey results, INS’ education media campaign was effective. Employers 

who responded that their familiarity with the law was increased as a 

result of INS’ campaign were also more likely to respond that they were 

clear about the law’s documentation requirements. 

Labor and SBA officials said they pass along IRCA information during 

their visits to employers. Labor activities involve distributing its 1987 

handbook, Information For Employees And Job Applicants Under The 

New Immigration Law, the INS Handbook for Employers, osc’s and INS’ 

Your Job and Your Rights, and the osc poster “What Employers Should 

Know.” SBA distributes IRCA information through its training and counseling programs provided to small businesses. 

Funding INS, osc, and EEOC officials reported spending about $728,000 on antidiscrimination education during fiscal year 1989. INS funded the majority 

of joint projects through its Employer Labor Relations program. osc, 

EEOC, and Labor have funded their individual initiatives within their 

authorized budgets. 

During fiscal year 1989, INS spent about $646,0001C1 to print posters and 

pamphlets, obtain an exhibition booth to use at conferences, develop 

new public service announcements, and travel. osc spent approximately 

$70,000 to print publications and for travel. osc officials stated that 

their attorneys do public outreach while investigating individual 

charges. An EEOC official stated EEOC spent about $12,000 to print its 

employer and employee publications and has incurred unspecified costs 

relevant to speaking engagements and conference time devoted to IRCA. 

Labor and SBA officials told us they do not record specific costs for 

antidiscrimination materials. Funding for their education projects comes 

from existing authorized budgets. 

As discussed previously, OSC’S 1990 budget includes $1 million and three 

positions for publicizing employer obligations and job applicant rights 

“‘This includes $100,000 for printing costs received from OSC. 

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under IRCA’S discrimination provision. INS estimates it will spend 

$894,000 to educate employees and employers about the antidiscrimination provision, as well as to educate the agricultural community. 

Conflusions ddespread pattern of discrimination has resulted against eligible workers. 

On the basis of the available information, we believe that it is more reasonable to conclude that a substantial amount of these discriminatory 

practices resulted from IRCA rather than not. Our determination is based 

solely on the findings regarding national origin discrimination. 

The results of the employer survey meet the criteria in the law for a 

“widespread pattern of discrimination.” We estimate that 46 1,000 

employers (10 percent) of the 4.6 million employers in the survey population nationwide began national origin discriminatory practices as a 

result of the sanctions provision. This meets the criterion in the legislative history of more than “just a few isolated cases of discrimination.” 

The employers who reported these practices were in a variety of industries and areas of the Nation and included firms of various sizes. This 

meets the criterion of “a serious pattern of discrimination.” 

The survey results also meet the criterion in the law and legislative history to measure only “new” discrimination resulting “solely from the 

implementation of” the sanctions provision. First, the employers who 

reported discriminating in actual hiring attributed these practices to 

IRCA. Second, employers reported applying IRCA’S work eligibility verification process in a discriminatory manner. This practice would not have 

occurred without IRCA. Thus, both practices meet the criterion in the law 

of measuring discrimination caused “solely from the implementation of” 

IRCA’s sanctions provision. 

The results of the employer survey also meet the criterion in IHCZ to 

measure discrimination against “eligible workers , . ,” We estimate 

227,000 employers in our survey reported that they began a practice of 

not hiring foreign-appearing or foreign-sounding job applicants. While 

we cannot estimate from the survey how many of these job applicants 

were affected or how many of these were eligible workers, the employers we surveyed hired an estimated 1.1 million employees in 1988. 

The results of our hiring audit were consistent with our survey results. 

For example, the Anglo testers received 52 percent more job offers than 

the Hispanic testers with whom they were paired. Although we did the 

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hiring audit at a relatively small sample of employers in two cities, the 

results tend to confirm our national survey finding that a large number 

of eligible workers were probably affected by the type of behavior we 

observed during the audit. 

Although the law requires only our determination as to the existence of 

a widespread pattern of national origin discrimination, we also noted 

that another 430,000 employers began citizenship discrimination as a 

result of the law. While we could not measure the effects of citizenship 

discrimination, these practices are also illegal and have the potential to 

harm persons, particularly those of Hispanic and Asian origins. 

Congress should implement the expedited consideration of the sanctions 

provision and has several options in the face of our “widespread pattern 

of discrimination” determination. It can leave the law as is for the present time, repeal the sanctions provision, or leave the provision in place 

and amend IRCA in other ways to reduce the extent of discrimination. 

The decision Congress must make is difficult because of IRCA’S mixed 

results. There has been discrimination. Ten percent of employers surveyed reported national origin discrimination as a result of the law, but 

90 percent did not; thus, IRCA-related discrimination is serious but not 

pervasive. And the sanctions provision at this time appears to have 

slowed illegal immigration to the United States. (See ch. 6.) 

We identified three possible reasons why employers discriminated as a 

result of the implementation of the sanctions provision: (1) employer 

lack of understanding of the law’s major provisions; (2) employer confusion and uncertainty on how to determine eligibility; and (3) alien use of 

counterfeit or fraudulent documents, which contributed to employer 

uncertainty over how to verify eligibility. 

In summary, much of the reported discrimination appears to come from 

employers who are confused about how to comply with IRCA’S verification requirements. Thus, it is likely that the widespread pattern of discrimination we found could be reduced by (1) increasing employer 

understanding through effective education efforts; (2) reducing the 

number of work eligibility documents; (3) making the documents harder 

to counterfeit, thereby reducing document fraud; and (4) requiring the 

new documents of all members of the workforce. 

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: 

jto Intensify 

* g tion Efforts 

I 

In our second annual report, we recommended that the Attorney Genera1 develop a coordinated strategy to better educate the public about 

the law’s antidiscrimination provision. The Attorney General agreed, 

and increased educational activities. Also, Congress appropriated $1 

million to osc for antidiscrimination education activities in fiscal year 

1990 and enacted other related actions that should help to reduce 

employer confusion. 

These are positive steps that should produce some beneficial results. 

Those results can be enhanced by better targeting intensified educational and antidiscrimination efforts at those employers that our analysis indicates are more likely to discriminate (i.e., medium-size employers 

and employers in areas of high Hispanic and Asian populations). 

.-i. Verlfjication System 

Shot$ld Be Improved If 

Sanc@ons Are Retained 

While education will help, fundamental reform is needed in IRCA’S current verification system if IRCA sanctions-related discrimination is to be 

reduced. These reforms must result in reducing the number of eligibility 

documents presently recognized. 

Need 

Educ 

Reducing the number of eligibility documents will raise many concerns-ranging from civil liberty issues to cost and logistics issues. Congress will have to consider carefully the tradeoffs it is willing to make in 

assuring that jobs are reserved for citizens and legal aliens against the 

aim of reducing discrimination in the process. Both objectives are 

important. 

To be optimally effective in reducing discrimination, the solution must 

(1) greatly reduce the number of work eligibility documents, (2) make 

the documents harder to counterfeit and reduce document fraud, and (3) 

apply to all members of the workforce. 

Such a system should reduce IRCA-related discrimination. It would make 

it easier for employers to comply with the law. It would relieve 

employer concerns about counterfeit documents. And it would reduce 

employer confusion resulting from the many possible documents that 

can presently be used for verifying work eligibility. 

Indeed, Congress anticipated that the verification system might need to 

be improved when it passed IRCA in 1986. As discussed in chapter 1, section lOl(a)( 1) states that the President can propose improvements to 

the employment verification system if necessary. The section specifies 

that any improvement to the verification system should 

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-- 

t 

I 

/ 

. yield reliable determinations of employment eligibility and identity, 

9 be counterfeit-resistant, 

. be used for employment verification only, 

. protect individual privacy, and 

l not be used for law enforcement purposes unrelated to IRCA. 

Congress also anticipated that one alternative for improving the verification system might be to use Social Security account number cards as a 

primary identifier. The section specifies that the President give Congress a year’s notice before implementing this change. It also specifies 

that any changes requiring an individual to present a new employment 

verification card or providing for a telephone verification system 

require 2 years’ notice. Either or both of these changes would require 

congressional approval. 

Reduce the Number of Work 

Uigibility Documents 

The five characteristics listed in section 101(a)(l) of IRCA are consistent 

with the types of changes we believe are necessary to the verification 

system to reduce discrimination. Increased reliability would make it easier for employers to comply with the law. Counterfeit-resistance would 

increase employer confidence that documents being presented were genuine. Privacy guarantees and prohibitions against using the employment 

verification system for other uses would reduce fears among both 

employers and prospective employees of unjustified government intrusion into their lives. Thus, when combined with fewer work eligibility 

documents and universal application throughout the workforce, such 

improvements to the verification system should both reduce discrimination and increase the effectiveness of sanctions. 

Feasible alternatives to reduce the number of work eligibility documents 

range from INS’ current plan to reduce from 10 to 2 the types of cards it 

issues to a plan that would require a single eligibility card for both 

aliens and citizens-such as the Social Security card, or a state driver’s 

license or state identity card with the Social Security number on it. 

Many would argue that we already have an almost universal identifier 

in the country-the Social Security number. To report income earned 

from work, a person must have a Social Security number. If parents 

have children they claim as dependents on their tax returns, they must 

list the children’s Social Security numbers if they are age 2 or older. 

Many states use the Social Security number as the identifier on their 

residents’ drivers’ licenses. 

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We analyzed the Social Security card option in our 1988 report. Using a 

single card would reduce employer confusion and make it easier for 

employers to comply with the law’s verification requirements without 

discriminating. For example, if the Social Security card were the only 

approved document, employers would be precluded from requiring foreign-appearing US. citizens to present an INS card before they could be 

hired. This alternative would also reduce unauthorized alien use of 

counterfeit versions of the numerous other documents presently allowed 

under IRCA (e.g., birth certificate, INS-issued cards). One shortcoming of 

the alternative, however, is that there are millions of aliens who have 

temporary work eligibility status who would have to be issued Social 

Security cards with an expiration date and then reissued new cards if 

their temporary status is renewed. 

If an SSN validation system is desirable, the Secretary, HHS, suggested 

an option to help ensure that the job applicant presenting a document is 

the person to whom it was issued. The Secretary suggested that since all 

state driver’s licenses contain a photograph, SSA could validate the Social 

Security numbers of people who apply for driver’s licenses and the validated number could be put on the license. Such a system, if expanded to 

also include persons who apply for driver’s license renewal or other 

state identity cards, would cover the majority of the Nation’s workforce 

in a relatively few years. To the degree that the state-issued identity 

documents incorporated counterfeit-resistant features, the effectiveness 

of the system would be further enhanced. As recognized by the Secretary, however, the states would have to agree to assume the burden. 

Regardless of which specific card or cards might be used, the questions 

of how to issue them, where, and over what time period must be 

answered. One way, possible for the 163 million people who have 

driver’s licenses, would be to do so in conjunction with their driver’s 

license renewal. A system could be established whereby the federal government would work in conjunction with state motor vehicle agencies to 

provide improved worker verification identification concurrently with a 

person’s renewal of his or her driver’s license or state identity card. Cost 

reimbursements and logistics of the process could be worked out. 

Should Congress opt for a single card system, it should assure that the 

system will not be administered by law enforcement agencies. There 

would be a temptation for misuse of information if any law enforcement 

agency controls the computer system and information going into it to 

assure the validity of the issued cards. 

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l-_l “&.--“. _.I 

Make the Documents More Wholly apart from their impact on discrimination, the prevalence of 

Coujnterfeit-Resistant and Reduce 

Docbment Fraud 

counterfeit and fraudulently obtained documents threatens the security 

of IRCA’S verification system for prohibiting unauthorized alien employI ment. INS apprehensions during a 2-month period in the summer of 1989 

showed that unauthorized aliens commonly possess counterfeit or fraudulently obtained Social Security cards or INS-issued documents. 

The alternatives for making work eligibility cards harder to counterfeit 

and reducing document fraud by unauthorized aliens range from INS’ 

current plan to improve the counterfeit-resistant features of its new 

cards to making the Social Security card more counterfeit-resistant. 

To increase employer confidence, a new Social Security card could be 

devised with state-of-the-art counterfeit-resistant features such as those 

discussed in our 1988 report. To preclude unauthorized aliens from 

using counterfeit Social Security cards they presently have, the new 

card could be made to look much different from the current card. To 

help ensure that unauthorized aliens do not fraudulently obtain the new 

card, SSA would have to take reasonable steps to verify that the documents persons use to apply for the new card (e.g., birth certificates) are 

valid. 

If sanctions are retained, we believe that the President should initiate 

proposals and Congress should consider legislation to make the documents more counterfeit-resistant. Any changes should take into account 

the privacy concerns reflected in the law as well as cost considerations, 

Apply Any New Identification to The alternatives for applying any new or improved work eligibility idenAll Members of the Workforce tification to the millions of eligible aliens and citizens in the workforce 

range from INS’ current practice to generally issue its new cards to only 

new temporary and permanent resident aliens, to having SSA issue a new 

counterfeit-resistant Social Security card to all eligible aliens and 

citizens. 

lf SSA were to begin issuing new counterfeit-resistant Social Security 

cards to only new applicants, little would be accomplished in reducing 

employers’ confusion and uncertainty regarding how to determine work 

eligibility due to the large number of old cards still in use. For the cards 

to be optimally effective in reducing IRCA-related discrimination, all 

members of the workforce (citizens and aliens) would have to receive 

the new cards. 

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--T------- 

INS plans to replace over 20 million old INS cards with the new cards by 

the mid-1990s. However, this schedule is dependent on additional funding and personnel. Unless this process is expedited, little will be accomplished in the short term to reduce employer confusion and uncertainty 

about determining work eligibility using INS documents. 

The trade-off along the range of alternatives is between effectiveness in 

reducing IrzcA-related discrimination and increased government costs and 

regulation. The more members of the affected workforce that receive an 

improved card, the more effectively discrimination will be reduced. 

Iiowever, this will also result in greater costs and in increased perception of government intrusiveness, 

Implementation Costs Could 

Affect the Feasibility of Some 

The costs of improving IRCA’S verification system could vary signifiSolutions 

cantly depending on the size of the affected workforce and the system 

design, 

One consideration that would affect cost would be the number of cards 

issued. For example, the issuance could be to only eligible aliens or to all 

citizens of working age. One option would be to phase in the issuance 

over several years to minimize the short-term cost impact. However, 

should Congress opt for a single card system, it should be universally 

required. 

The costs of a new counterfeit-resistant Social Security card could also 

vary significantly depending on its design. For example, including a photograph would increase the costs of issuing the card and require periodic 

reissuance since appearances change over time. However, this would 

help ensure that the job applicant presenting the card is the person to 

whom it was issued. 

Costs for INS to issue its new counterfeit-resistant card could also vary 

significantly. If the new card were issued to all permanent resident 

aliens in the workforce, it would cost significantly more than issuing it 

to only new permanent resident aliens. One option Congress and the 

Administration could consider to reduce the immediate costs would be to 

phase in the distribution of the cards to all eligible aliens over several 

years. 

Other considerations for reducing cost include: 

. using existing government programs and agencies capable of processing 

large amounts of data rather than creating a new organization; and 

Page 77 GAO/GGD90-62 Employer Sanctions 
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LMscrlminatory Practices Widespread: A 

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. sharing the issuance cost between the government and the individual, as 

is now often the case when people apply for driver’s licenses or state 

identity cards. 

tters for 

lgressional 

The amount of discrimination we found resulting from IRCA is serious 

and requires the immediate attention of both Congress and the Administration. There are two ways to proceed. 

wideration 

One way is to rely upon the President to propose verification system 

changes he deems necessary, pursuant to the provisions of section 

101(a)(l) of IRCA. This course would leave the initiative for action up to 

the executive branch. However, the necessary changes would require 

extensive debate and discussion between the legislative and executive 

branches before a final decision could be made on the solution. 

The second alternative is for Congress to initiate discussion with the 

executive branch and interested parties on solutions to the IRCA verification problem that should be considered in light of our findings. This 

could expedite the process. 

In the final analysis, Congress has the following options: (1) leaving the 

sanctions and antidiscrimination provisions of the law as is for the present time, (2) repealing these provisions, or (3) leaving the current provisions in place and enacting legislation to amend IRCA’S verification 

system to reduce the extent of discrimination resulting from IRCA. 

The exact nature of the solution will emerge only after the debate that is 

inherent in our democratic process. Should Congress decide to retain 

sanctions and improve the current verification system, three principles 

for improving the system while reducing discrimination need to be kept 

in mind. These are: (1) reducing the number of work eligibility documents, (2) making the documents more counterfeit-resistant and less 

vulnerable to being used fraudulently, and (3) applying any reduced 

work eligibility documents to all members of the workforce. Congress 

could then defer further consideration of repealing the sanctions and 

antidiscrimination provisions of IRCA until a simpler and more reliable 

verification system has been in place for sufficient time to evaluate its 

effectiveness. 

Page 78 GAO/GGD9082 Employer Sanctions 
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the 

Chapter 3 

Dlscrlminatory Practices Widespread: A 

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mmendation to We recommend that the Attorney General direct the Special Counsel to 

Utorney General increase the government’s efforts to educate the Nation’s employers on 

how to comply with IRCA’S antidiscrimination provision, particularly 

medium-size employers and employers in areas of high Hispanic and 

Asian populations. 

Page 79 GAO/GGD-90-62 Employer Sanctions 
Ch&Xer 4 

Slkudies by City, State, and Private 

’ of-g anizations Show IRCA-Related 

MS crimination 

/ In reaching our determination that IRCA’S implementation has led to 

widespread discrimination against eligible workers, we relied on the 

measures described in chapter 3. In this chapter, we explore other 

sources of information on IRCA’S impact.’ 

The findings from the studies and other sources should be interpreted 

with caution. Some of the studies’ findings are based on non-representative samples. In addition, some of the organizations conducting the studies or providing data to us are not neutral in their position on the 

employer sanctions provision. Although the organization’s position on 

employer sanctions may not have influenced their findings or conclusions, we cannot rule out the possibility of such influence. However, 

although all of the sources and studies have methodological limitations, 

we believe all information on IRCA-related discrimination should be available for consideration in the policy debate by Congress. 

1 

Sujvey of Private, 

St&e, and Local 

Agencies 

Discrimination 

Complaints 

State, local, and private organizations receive complaints about employment discrimination. We asked several of these organizations to provide 

information about the complaints received from July 1, 1988, to June 

30, 1989. We also asked them to use EEOC criteria (see p. 33 for description) to identify the discrimination complaints related to employer 

sanctions. 

The 14 organizations that responded to our survey with data were (1) 

American Friends Service Committee/Newark, (2) Center for Immigrant 

Rights, Inc./New York City, (3) Central American Refugee Center/Los 

Angeles, (4) Chicago Commission on Human Relations/Chicago, (6) 

Church Avenue Merchants Block Association, Inc./New York City, (6) 

Coalition for Humane Immigration Rights of Los Angeles/Los Angeles, 

(7) Community Task Force on Immigration Affairs/Houston, (8) Mexican-American Legal Defense and Educational Fund (MALDEF)/ChiCagO, 

(9) MALDEF/SaII Francisco, (10) MALDEF/LOS Angeles, (11) New York City 

Commission on Human Rights/New York City, (12) Travelers Aid Services/New York City, (13) Archdiocese of Detroit/Detroit, and (14) Maricopa County Organizing Project/Phoenix. 

‘In December 1989, Congress amended IRCA to authorize states to use State Legalization Impact 

Assistance Grant Funds for education and outreach efforts regarding employer discrimination on the 

basis of national origin or citizenship status. (The Immigration Nursing Relief Act of 1989, Public Law 

101-238, was approved December 18,1989.) 

Page 80 GAO/GGD99-62 Employer Sanctiona 
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Or~~tions Show IRCA-Related 

Dl8crlmlnation 

The 14 organizations reported having received a total of 1,200 complaints during the period July 1, 1988, to June 30, 1989. The majority of 

complaints were from authorized aliens, as shown in figure 4.1. 

4% 

U.S. citizens 

72% - - Authorized aliens 

Na1.200 

For the 913 complaints received from citizens or authorized aliens, the 

organizations reported that, according to EEOC criteria, 567 (62 percent) 

appeared to be related to the sanctions provision. 

The most frequently cited discrimination issue by complainants was that 

employers had discriminated against them in terms and conditions of 

employment; there were also many complaints based on firing or not hiring. Within these issues, the most frequently cited allegation (not including “other”) was that employers did not accept valid work authorization 

documents. (See table 4.1.) 

Page 81 GAO/GGD-90-62 Employer Sanctions 
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Orgc 

Ci E; T and State 

Or ‘g; anizations Study 

Discrimination 

- 

Chapter 4 

Studies by City, State, and Private 

Organizations Show IRCA-Related 

Discrimination 

/ I 

ev 

B b I 

1.1: Discrlminatlon Complaint8 

*ed by Private, State, and Local 

zatlons 

Most frequent discrimination issue Number received 

Terms and conditions of emolovment 392 

Fired 261 

Not hired 223 

Most freauent alleaation against emplovers 

Did not accept valid work authorization documents 296 

Retaliated because alien became legalized or asked for assistance to 

become leaalized 157 

Reauired permanent resident card 57 

The majority of complaints received from authorized workers were from 

Hispanics (83 percent) and temporary resident aliens (56 percent). 

Several other city and state agencies have studied IRCA’S implementation 

want to exclude any information related to this issue. 

to determine if it has caused discrimination. Although the methodologies 

employed in these studies are not as strong as our methods, we did not 

Telephone Hiring 

New York City Al 

Discrimination 

Audit in In June 1989, the City of New York Commission on Human Rights 

,so Shows observed employer behaviors through a telephone hiring audit. The 

audit was designed to identify different treatment by prospective 

employers toward telephone callers with accents compared to callers 

without accents.” Each audit consisted of a pair of testers of the same 

sex calling an employer in response to randomly selected help wanted 

advertisements in the four major New York City daily newspapers. One 

member of each pair had a foreign accent. Each tester pair offered substantially similar qualifications and backgrounds. All 86 employers 

audited were asked whether the position was open, if the caller could 

come for an interview, and what papers the caller should bring. 

The hiring audit showed 41 percent of employers treating applicants 

with accents differently from applicants without accents. Of the 

employers contacted, 

“Tarnishing the Golden Door: A Report on the Widespread Discrimination Against Immigrants and 

I’crsons Perceived as Immigrants Which Has Resulted From the Immigration Reform and Control Act 

of 1986. The City of New York Commission on Human Rights, August 1989. 

Page 82 GAO/GGD-90-62 Employer Sanctions 
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Studies by City, State, and Private 

Ch&iU&btiox~;~~ow IRCA-Related 

l 16 percent told accented callers that the positions were filled and told 

unaccented callers that the same positions were open, 

. 12 percent scheduled interviews with only unaccented callers, and 

. 13 percent required significantly different documents from accented as 

opposed to unaccented callers. 

The report used the hiring audit to support its finding that the employer 

sanctions provision of IRCA had resulted in widespread discrimination 

against immigrants and persons perceived as immigrants. 

SurJey of San Francisco 

Emdloyers 

. 

. 

Between July 26 and August 2, 1989, San Francisco State University’s 

Public Research Institute and the Coalition for Immigrant and Refugee 

Rights and Services did a telephone survey of San Francisco employers.” 

The 416 responses were from a randomly selected sample of 942 San 

Francisco businesses. The purpose of the survey was to “examine the 

impact of IRcA’s sanctions on workers and employers in San Francisco 

and to determine whether such sanctions have resulted in employment 

practices that are either discriminatory or otherwise unfavorable to certain classes of authorized workers.” The reported survey population 

included 36,730 firms employing 567,300 workers. 

The survey reported the following results: 

50 percent of the 373 employers who responded thought it riskier to 

hire people who speak limited English, 

79 percent of the 341 employers who responded accepted only the most 

common and “official” documents even though there are many other INSapproved documents that authorize employment, 

41 percent of the 340 employers who responded required employment 

authorization documentation before hiring, 

26 percent of the 379 employers experienced hiring delays while jobseeker obtained documents, and 

12 percent of the 402 employers who responded had different employment authorization requirements for foreign-born workers than for 

those born in the United States. 

“Employment and Hiring Practices Under the Immigration Reform and Control Act of 1986: A Survey 

of San Francisco Businesses (San Francisco, Sept. 1989). 

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I 

I Calijf’ornia Fair The California Fair Employment and Housing Commission held hearings 

EmQloyment and Housing in three cities during 1989 to determine, among other things, if employCon mission 1 

ment discrimination had increased as a result of IRCA. The Commission 

received extensive written documents and heard testimony from over 30 

witnesses, including employers, employees, unions, attorneys, INS, and 

*Justice’s OSC. 

In a January 1990 report, the Commission concluded that it appears 

that 

“employers’ fear of sanctions, and confusion and misinformation about IRCA’s 

requirements, coupled with a tremendous administrative backlog at the INS, have 

resulted in a widespread pattern and practice of discrimination. . , based on 

national origin and citizenship status, in violation of IRCA’s anti-discrimination provisions as well as other state and federal civil rights laws.‘14 

For these reasons, and because the Commission believes employer outreach can be more effective in an atmosphere free of the threat of sanctions, the Commission recommended (1) a moratorium on employer 

sanctions enforcement and (2) a 2-year extension of the law’s “sunset” 

(repeal) provision beginning after the moratorium. 

The Commission’s report contained other findings and recommendations 

to change IRCA and INS’ regulations and administrative procedures. For 

example, the Commission found the following: 

l INS public education materials are incomplete and confusing. As a result, 

employers who are presented with unfamiliar documents often terminate or refuse to hire persons who have demonstrated their legal entitlement to work. 

l Severe INS delays exist in issuing initial and renewed work authorization 

documents. This has resulted in employers firing or refusing to hire 

employees who are legally entitled to work but who have not yet 

received work authorization documents. 

‘Public IIcarings on the Impact and Effectiveness in California of the Employer Sanctions and AntiI%crimination I’rovisions of the Immigration Keform and Control Act of lYS%Xalitornia Pair 

Employment and Housing Commission, January 11, 1VVU. 

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Dif3criminatlon 

New’ York State Task 

1 Fort .l 

I 

~ 

The New York State Inter-Agency Task Force on Immigration Affairs 

studied mcA-related employment discrimination in New York and issued 

a final report in November 1988.” The study included telephone interviews with 400 randomly selected employers in the New York City metropolitan area and a survey of community-based organizations. 

The survey of community organizations showed that most problems concerned employers refusing to accept certain work authorization documents from eligible workers. 

I The Task Force report contained other findings and recommendations as 

I follows: 

. It estimated at least 10,486 occasions when people had been denied 

employment because of delays in issuing documents. 

v It found that 73 percent of employers familiar with the I-9 procedures 

required work authorization documents before the first day of work. 

l The report said that 20 percent of employers familiar with the 1-a procedures reported difficulty in determining if particular documents were 

allowable 

The Task Force recommended, among other things, that INS (1) develop 

uniform work authorization documents and (2) increase employer education in New York. 

Arizona Civil Rights 

Ad&wry Hoard 

The Arizona Civil Rights Advisory Board held a public hearing in June 

1989 to determine whether IRCA had a discriminatory impact on the hiring of Hispanics and other foreign-looking residents of Arizona. The 

Board concluded that IRCA caused an increase in national origin employment discrimination. It also concluded that few IRMA complaints had been 

reported because government agencies had not informed affected individuals of their rights under IRCA’S antidiscrimination provision. 

The Hoard supported recommendations similar to those made by the 

1J.S. Civil Rights Commission,” some of which include (1) amending 

‘Workplace Discrimination IJndcr the Immigration Reform and Control Act of 1986: A Study of 

Impacts on New Yorkers. New York State Inter-Agency Task Force on Immigration Affairs, Novembcr 4, 1988. 

“The Immigration Reform and Control Act: Assessing the Evaluation Process, A Report of the United 

Slates Commission on Civil Rights (Washington, DC., Sept. 1989). 

Page 85 GAO/GGD90-62 Employer Sanctions 
Chapter 4 

Studies by City, State, and Private 

Organizations Show IRCA-Related 

Discrimination 

IRCA'S provisions to have GAO do at least one additional report, (2) holding hearings to collect both qualitative and quantitative information, (3) 

using data from state and local governments and private organizations, 

(4) defining in statute what constitutes “unacceptable discrimination,” 

and (5) requiring specific examination of sanctions’ effectiveness. 

elusion A common finding in the various studies was employers’ refusal to 

accept, or uncertainty about, valid work eligibility documents. 

Page 86 GAO/GGD90-62 Employer Sanctions 
INf3 and Labor Have Generally Met Their 

R 

II 

--. 

sponsibilities to Carry Out 

;A Satisfactorily 

- __. ._ 

Congress asked us to determine if IRCA’S sanctions provision was carried 

out “satisfactorily.” Congress did not define “satisfactorily,” but to us 

the word means average performance (i.e. midway between exceptional 

and failure). Thus, INS, which is responsible along with the Department 

of Labor for carrying out this law, would meet our definition for satisfactory performance if, at a minimum, it developed plans and policies 

and implemented procedures that could reasonably be expected to (1) 

identify and fine violators and (2) educate employers about their legal 

requirements. We applied the same standards to Labor, with the exception of fining violators. 

In this chapter, we (1) determined if INS and Labor carried out the law 

satisfactorily as we defined it and (2) reviewed one aspect of the law’s 

implementation that is not included in the definition of “satisfactory” 

because it is generally beyond INS’ and Labor’s immediate controlemployers’ unwillingness to voluntarily comply after considerable government education efforts. 

We found that INS and Labor have generally fulfilled their responsibilities to carry out the law satisfactorily. INS has developed plans and policies and has implemented procedures for the program that we believe 

could reasonably be expected to identify and fine violators and educate 

employers. Similarly, Labor has developed plans and policies, and has 

implemented procedures to identify potential IRCA violators report them 

to INS, and educate employers. Using these policies and procedures, INS 

has identified employers who were not in compliance with IRCA and 

issued them over 8,800 fine notices or warnings.’ For the 431 closed fine 

cases where employers requested a hearing, INS prevailed against the 

employer in every case. Labor has educated almost 90,000 employers, 

conducted over 77,000 inspections, and reported the results of employer 

visits to INS. 

Following INS’ efforts to educate employers about IRCA’S employer sanctions provision, an estimated 83 percent of employers said they were 

aware of the law. Also, employers visited by INS reported a higher compliance level and a better understanding of the form I-9 requirements 

than those INS did not visit. Most of the employers who were aware of 

the law and had a basis to judge INS’ education effort said it helped to 

familiarize them with the law. 

’ Warnings included citations that were issued prior to the full enforcement of IRCA Citations had the 

same effect as a warning. 

Page 87 GAO/GGD-90-62 Employer Sanctions 
IN: 

IR( 

Chapter 6 

INS and Labor Have Generally Met Their 

Responsiblllties to Carry Out 

IRCA Satiofactorlly 

Although it has generally carried out the law satisfactorily, INS needs to 

improve its implementation of the sanctions provision. Specifically, INS 

needs to (1) reinspect employers who hired unauthorized aliens to determine if they have come into compliance, (2) document in the official INS 

case files the important events that occur during investigations, (3) 

develop an effective employer sanctions information system for the program, and (4) modify its nationwide inspection program of randomly 

selected employers so that the results can be generalized to industries 

and geographic areas. 

For those employers in our 1989 survey who said they were aware of 

the law and hired at least one employee, 65 percent were in full voluntary compliance with the I-9 requirements. 

Tabls 

(Nove 

Implementation of As of September 16, 1989, INS had issued over 3,500 intent-to-fine 

A 

notices to employers for employing unauthorized aliens or for not completing 1-9s. The fines assessed totaled almost $17 million. After negotiations with employers, INS settled for about $6.1 million. Table 5.1 

summarizes INS’ enforcement actions since the law was enacted. 

5.1: INS Enforcement Actions 

lber 6, 1986, to September 16, 1989) Action Number Dollar amount __-._____~ 

Fines assessed 

---_____~__--.-~~ 

Violations 

-Employing aliens 

-Not completing 1-9s 

.--___ 

Fines settled 

. . -..-.--. 

Fines collected 

Note: One fine may involve multiple violations. 

- 

3,532 $16,952,988 

3,240 

36,354 

.-- 

2,534 6,142,678 

1,937 4,999,750 

Source: INS Regional Offices 

In addition, INS issued over 5,300 warning notices (or citations) to 

employers during this period. According to INS, as of September 7, 1989, 

it prevailed in all 431 closed employer sanction cases where the employers requested hearings. In most of these cases the employers settled with 

INS before the hearing. 

Page 88 GAO/GGD-90-62 Employer Sanctions 
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INS and Labor Have Generally Met Their 

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IRCA Satisfactorily 

I 

INa Policy for Fining On the basis of our review of randomly selected employer sanction fine 

Embloyers Was cases, we found that INS field offices have satisfactorily carried out the 

Commissioner’s policy for sanctioning employers. We estimate that at 

Caqried Out least 97 percent of the fines complied with the policy. 

Satisfactorily On April 15, 1988, the Commissioner delegated to four INS regional 

offices the authority to approve intent-to-fine notices and authorized the 

regional offices to further delegate approval authority to individual districts and sectors. On May 26, 1988, the Commissioner established a 

sanction policy, and on June 1, 1988, INS commenced full enforcement of 

employer sanctions.’ 

The Commissioner’s policy emphasized penalizing employers who knowingly hired or continued to employ unauthorized aliens, Accordingly, INS 

may fine employers for paperwork violations if the employer (1) fails to 

complete 1-9s for new employees following a documented educational 

contact; (2) has unauthorized workers in the workplace, and the “knowing” violation cannot be proven; (3) agrees to a paperwork fine pursuant 

to a plea agreement; or (4) other egregious factors exist. 

From our review of closed fine cases, we estimate that out of 702 fines 

levied against employers, 683, or 97 percent, of the fines were consistent 

with INS policy, and 19, or 3 percent, may not be. 

Of the estimated 683 employer fines, we estimate that about 

l 354 were for knowingly hiring or continuing to employ unauthorized 

workers; 

l 73 were for violations following a documented educational contact; and 

l 256 were for paperwork violations but involved the apprehension of 

unauthorized workers in the workplace.” 

The remaining estimated 19 fines were for paperwork violations. The 

files we reviewed did not indicate any of the first three conditions specified in the Commissioner’s policy that would call for the imposition of a 

paperwork fine. Under the policy, these fines may involve egregious factors, According to INS officials, “egregious” was not defined. Therefore, 

‘Thr enforcement of sanctions did not include employers of seasonal agricultural employees because 

such employers could not be sanctioned before December 1, 1988. 

“Ninety-four of the 258 fines involved the franchise operations of one company. The fines were settled under a collective agreement that included the apprehension of an unauthorized worker. For the 

purpose of this analysis, WC considered the employment of unauthorized workers as “egregious”. 

Page 89 GAO/GGD-90-62 Employer Sanctions 
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INS aud Labor Have Generally Met Their 

BesponsibIlities to Carry Out 

IRC.4 Satisiactorily 

we were not able to determine if the estimated 19 fines were consistent 

with the policy. 

Enjployers Reported 

IN 

P 

Education Efforts 

He ped Familiarize 

Thbm With the Law 

A major element of the INS implementation strategy is educating employers about IRCA’S requirements. According to INS records, between November 6, 1986, and September 1, 1989, INS contacted over 2.2 million 

employers to explain IRCA. Also, INS distributed an Employer Handbook 

explaining the law to over 7 million employers and conducted a national 

media campaign. 

According to our 1989 survey results, about 1.7 million of the 3.1 million 

employers who were aware of the law and had a basis to judge INS' education efforts said INS’ efforts had increased their familiarity with the 

law. We estimate that about 636,000 employers who were aware of the 

law said they had no basis to judge INS’ efforts, 

Ikployers Visited by INS 

Report Increased 

Understanding and 

Compliance 

. 

According to our 1989 survey, an estimated 134,000, or 3 percent, of the 

4.6 million employers in our survey population said they had received 

INS visits since the law’s enactment, Generally, these employers reported 

knowing more about the I-9 requirements than employers not visited. 

Also, a higher percentage of the visited employers were in full compliance with the law’s verification requirement than those not visited. 

According to our survey, 

99 percent of the employers who had been visited by INS told us they 

were aware of the law, and 82 percent of the employers who had not 

been visited by INS said they were aware of the law; 

82 percent of the employers who had been visited by INS said they 

understood the I-9 requirements, and 57 percent of the employers who 

had not been visited by INS said they understood the I-9 requirements; 

and 

79 percent of the employers who had been visited by INS had completed 

all required 1-9s and 57 percent of the employers who had not been visited by INS completed all required 1-9s. 

Page 90 GAO/GGD-90-62 Employer Sanctions 
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INS and Labor Have Generally Met Their 

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Lab r’s Inspections of 1-9s 

Sho Lower Compliance 

Lev Than GAO Survey 

Between September 1,1987, and September 30,1989, Labor Department 

officials from the Wage and Hour Division and the Office of Federal 

Contract Compliance Programs completed 77,638 compliance inspections Forty-three percent of the employers inspected were in compliance with the i-9 requirements. This level is lower than the 65 percent 

compliance level we found in our randomly selected nationwide sample 

of employers. According to Labor officials, this difference could be 

because most visits were to employers suspected of violating one or 

more federal labor laws. We did not verify the accuracy or reliability of 

Labor’s inspections data. 

Labor reports the results of employer visits to INS, including those where 

Labor did not inspect the I-as. For example, the employer’s 1-9s might 

have been at another location, or Labor might not have been able to provide the employer with the required 3-day notice of the inspection. In 

fiscal year 1988, about 6 percent of Labor’s visits did not include an 

inspection of the 1-9s because it did not provide the employer with a 3- 

day notice. 

We discussed with Labor officials the need to provide employers with 

the required 3-day notice of inspection. Labor subsequently revised its 

notification letter to employers to include the notice of the I-9 inspection. 

By March 1989, Labor had implemented this revision, and the percentage of inspections that were not performed in fiscal year 1989 subsequently dropped to less than 4 percent. 

Labor officials also reported other possible violations they observed. 

Through June 30,1989, these included 

42 visits where Labor suspected there might have been unauthorized 

aliens, 

10 employers who were suspected of disparate treatment of employees, 

and 

56 visits where employees were suspected of using counterfeit or fraudulent documents. 

Page 91 GAO/GGD90-62 Employer Sanctions 
Chapter 6 

-- 

INS and Labor Have Generally Met Their 

Responsibilities to Carry Out 

IRC4 Satisfactorily 

Our second annual report on employer sanctions recommended that 

Labor officials take reasonable steps, such as reviewing employer 

records to determine if i-as have been prepared for all new employees. 

By May 1989, Labor had revised its field manuals to include instructions 

to request such documentation from employers. 

Opportunities to We identified four areas where INS could improve its implementation of 

Improve INS employer sanctions: (1) reinspection of employers who have been sanctioned for hiring unauthorized aliens to determine if they are continuing 

Iqplementation of the to violate the law, (2) documentation of decisions made during investigaLap 

tions in the official case file, (3) modification of its program for randomly selecting employers for inspection so that the results can be 

generalized to particular industries and geographic areas, and (4) development of an automated employer sanctions information system that 

can more effectively monitor the program. 

Need to Reinspect INCA imposes progressively higher fines to deter employers from repeatEniployers Who Have Been edly hiring unauthorized workers. The INS employer sanctions field manSalhctioned ual does not require INS officials to reinspect sanctioned employers, but 

without a reinspection INS cannot tell if the sanctioned employer stopped 

the illegal practice. 

On the basis of our review of closed INS employer sanction case files, we 

identified 224 cases where INS determined that the employer had 

employed at least one unauthorized alien, INS followed up in 31 of these 

cases and determined that 20 were in compliance and 6 were not (2 were 

continuing to employ unauthorized aliens and 4 were not complying the 

i-9 requirements). The results of the remaining five follow-up cases were 

not in the file. 

Tips from informants prompted INS to begin the two follow-up cases that 

resulted in fines for continuing to employ unauthorized aliens. In one 

case, the employer was fined $6,000 for knowingly employing four 

unauthorized aliens and for four violations of the I-9 requirements. During the month the employer paid the fine, INS received another tip that 

the employer had rehired one of the unauthorized aliens. INS investigated the tip and fined the employer an additional $4,000. 

Our discussions with INS field officials indicated that there might be 

more follow-up than is documented. For example, one INS district notified employers who had been sanctioned and requested them to submit 

Page 92 GAO/GGD-90-62 Employer Sanctions 
Cas 

Dot 

Dee 

Chapter 5 

INS and Labor Have Generally Met Their 

Responsibilities to Carry Out 

IRC4 Satisfactorily 

I Files Lack 

lmentation for 

sions Reached 

- 

all I-% to INS for reinspection. Other INS officials said they had done some 

follow-up but did not include the results in the case files. 

- 

We believe that documenting the decisions INS makes during an 

employer sanction investigation is an effective internal control that (1) 

allows INS to assess whether the program’s objectives are being 

achieved, (2) helps ensure equitable treatment of employers, and (3) 

provides a proper foundation for future enforcement action. From our 

review of closed fine cases, we estimate that, from a universe of 702, 

many were missing write-ups documenting events such as: 

reasons for reducing the initial fines (an estimated 378 cases); 

whether INS had educated the employer about the law’s requirements 

before assessing a fine (an estimated 188 cases); 

the INS application for the notice of intent-to-fine (an estimated 383 

cases); 

whether the employer of unauthorized workers agreed as a part of the 

settlement to participate in the INS program to help employers find 

sources of authorized workers (an estimated 138 cases); 

whether fines were collected (an estimated 84 cases) and if they were 

not, why not (an estimated 26 cases); and 

the final order or settlement agreement with the employer (an estimated 

26 cases). 

According to an INS official, some offices maintain records of educational 

contacts separate from the case files. She also said that INS is preparing 

a new records manual that should ensure consistent recordkeeping and 

documentation for case files. 

INS can benefit from documenting the events that occurred during the 

initial violation when following up on employers suspected of repeatedly violating the law. For example, IRCA provides the following five factors for INS to use in determining the amount of the fine: (1) the size of 

the business, (2) a good faith effort to comply, (3) the seriousness of the 

violation, (4) the presence of unauthorized alien employees, and (5) the 

employer’s history of previous violations. If INS does not document the 

factors it considers when establishing the initial fine, information may 

not be available to establish the appropriate fine for repeat violations. 

Further, without such information, INS may not be able to demonstrate 

that employers with the same violation and different fine amounts were 

treated equitably. For example, an employer in INS’ Western Region had 

Page 93 GAO/GGDY0-62 Employer Sanctions 
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-. 

Chapter 6 

INS and Labor Have Generally Met Their 

Responsibilities to Carry Out 

IRCA Satisfactorily 

paperwork violations for six authorized workers and was assessed a 

$2,000 fine, which INS settled for $1,500. However, we found an 

employer in the Southern Region who had the same number of violations 

and was assessed a $600 fine, which INS settled for $100. These employers might have been treated fairly, considering the details of their cases. 

The files, however, lacked information that would explain the 

discrepancy. 

According to INS officials, INS fines employers to encourage compliance 

with IHCA and, in our opinion, the fine must be high enough to achieve 

that goal. INS has discretionary authority to reduce fine amounts and did 

reduce them in 59 percent of the cases. However, in 91 percent of these 

cases INS did not document the factor(s) that contributed to the fine 

reduction. Without this information, INS cannot be certain that fine 

amounts for subsequent violations are appropriately set. 

INS Needs to Modify Its 

Random Inspection 

PrBgram to Provide 

Reliable Measures of 

Vcjluntary Compliance 

With millions of employers and limited investigative resources, INS needs 

to effectively identify reason of noncompliance for action. INS’ only measure of voluntary compliance is the General Administrative Plan (GAP), 

which randomly selects employers for I-9 inspections. The results of GAP 

inspections can be used to identify areas of noncompliance. For example, GAP results could show which industries or geographic areas have 

higher noncompliance levels. With this information, INS can direct additional education or investigative resources toward that industry or area. 

GAP has two parts: (1) employers randomly selected from all industries 

and geographic areas (the General Inspections Program) and (2) employers randomly selected from specific industries that have employed significant numbers of unauthorized aliens (the Special Emphasis 

Inspection Program). INS district and sector officials select the industries 

and areas for the Special Emphasis Inspection Program. In fiscal year 

1989, INS used about 35 percent of its employer sanction enforcement 

resources to do 5,118 GAP inspections. Each of the GAP programs 

received about half of the inspection resources. 

We found that (1) INS plans to devote more resources to the GAP General 

Inspections Program than necessary to measure employer compliance 

levels nationwide and (2) the GAP Special Emphasis Inspections Program 

cannot be used to generalize compliance levels to specific industries in 

selected areas (or nationwide). 

Page 94 GAO/GGD-90-62 Employer Sanctions 
Chapter B 

INS and Labor Have Generally Met Their 

Reeponeibilities to Carry Out 

IRC4 Satisfactorily 

Gene.ral Inspections 

Program 

One purpose of the General Inspections Program is to monitor the 

nationwide compliance levels among various employment sectors by 

inspecting the 1-9s of a nationally representative sample of employers. 

INS planned to do 14,141 general inspections in fiscal year 1989. This 

number is based on the INS resources at the district and sector levels that 

are available during the year to complete the inspections. While 14,141 

inspections may promote employer compliance, the number far exceeds 

the inspections required to provide reliable information on nationwide 

compliance levels. A sample of 400 randomly selected employers is 

enough to generalize the results to all employers nationwide (but not to 

selected areas) and be reasonably confident (95 percent) that they are 

accurate. Further, if INS completes the 14,141 planned inspections, the 

results cannot be generalized to specific industries or areas of the country due to the lack of an appropriate sampling plan. 

INS identified employers to receive general inspections by drawing a random sample of employers from a list of over 5 million employers. This 

sample will permit INS to measure the nationwide compliance level for 

all industries and areas. However, the sampling plan INS devised did not 

consider employers’ industries or their geographic distribution. Consequently, INS will not be able to reliably measure compliance levels by 

industry or geographic area. To do so would require INS to use information on the distribution of industries nationwide. This would provide a 

proportionate stratified random sample that would permit generalization of inspection results to specific areas and industries. 

Special Emphasis 

Inspefztions Program 

The Special Emphasis Inspections Program is directed at employment 

sectors that have in the past employed significant numbers of unauthorized aliens. INS officials in each district and sector can select as many as 

five industries that in the past hired unauthorized aliens. Like the sampling plan for general inspections, the number of employers selected for 

special emphasis inspections is determined by the level of INS resources 

available. INS planned to do 18,080 special emphasis inspections in fiscal 

year 1989. 

The results of these inspections, however, cannot be generalized to specific industries or areas, as intended. To generalize to specific industries 

or areas would have required (1) using objective criteria to select industries based on an analysis of previous alien apprehensions and (2) knowing the portion of the universe of employers that each selected industry 

Page 95 GAO/GGD-SO-62 Employer Sanctions 
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INS and Labor Have Generally Met Their 

Reeponeiblllties to Carry Out 

lRC4 Satisfactorily 

represents. Our review of the district and sector justifications for selecting industries showed that they did not meet one or both of the requirements, Specifically, 23 INS offices did not submit a plan, Thirty-seven 

submitted plans that either did not have the required analysis or did not 

consider the number of employers within the various industries. Even 

though the employers are randomly selected for special emphasis 

inspections, the results cannot be generalized to each area’s industries or 

to employers nationwide unless both requirements are met. 

L 

-7 G 

% 

0 Proposed a More 

Ef [icient GAP Plan 

We prepared a detailed sampling plan for GAP that would allow INS to 

reliably measure voluntary compliance nationwide and in each region 

for all 10 industry classifications. Our plan presents one alternative to 

INS for the more efficient achievement of all the goals of GAP. At the 

same time it reduces by 25 percent the amount of personnel resources 

required for the task. In December 1989, we presented this plan to INS 

officials who agreed to consider it. 

In general, the proposed plan calls for temporarily combining the Special 

Emphasis and General Inspections programs into a single inspection program. On the basis of information gained over 3 to 5 years of operation, 

it would provide a more objectively defined special emphasis group consisting of those employers who are least likely to be in compliance. 

Several aspects of the current program would be maintained. The individual district and sector offices would continue to identify the number 

of inspections to be done within their respective areas, Specific employers would still be randomly selected from the universe of employers 

within the area. However, employers would be selected for inspection 

using different procedures. Rather than allowing local INS officials to 

select Special Emphasis industries, all selections would be based upon a 

proportionate random sample of employers within each industry. The 

number of employers selected overall would be determined by (1) available resources and (2) the proportion of employers falling within each 

industry in the individual geographic area serviced by the office. 

This type of selection would ensure more objective criteria for defining 

future Special Emphasis inspections. It would also maximize the educational and deterrence goals of the program because the likelihood of an 

inspection would not be known within any particular industry. Under 

current procedures, industries within a category may become aware 

through informed communication channels that they are targeted for 

Page 96 GAO/GGD-90-62 Employer Sanctions 
Chapter 5 

INS and Labor Have Generally Met Their 

Reeponsibilities to Carry Out 

IRCA Satisfactorily 

inspections. This could minimize the educational and deterrence 

impacts. 

eeds to Implement a 

. 

. 

. 

. 

. 

The INS employer sanctions information system does not provide much 

of the information we believe is needed to provide effective management 

oversight of the program. INS officials planned to make system improvements in fiscal year 1989 but did not. 

As of July 1989, INS’ employer sanctions information system relied on 

manual compilations of district and sector reports on their employer 

sanction activities. The field offices report both employer education contacts and enforcement activities. With this information, INS headquarters officials monitored the number of (1) education contacts; (2) 

compliance inspections; and (3) investigations, warnings, and fines. 

However, this manual system does not provide the following 

information: 

the number and type of violations by industry, 

GAP results on employer compliance within specific industries, 

the number of unauthorized aliens apprehended at work and the portion 

that were hired before and after IRCA, 

the extent of alien use of counterfeit or fraudulent documents to complete 1-9s and the types of documents used, 

the number of employers charged with criminal and civil violations, 

whether local INS office reinspection of sanctioned employers identified 

repeat violators, 

the number of employers issued an intent-to-fine notice who have 

requested a hearing before an administrative law judge, and 

how much of the total fines that employers agreed to pay has been 

collected. 

INS planned to implement a service-wide automated information system 

in fiscal year 1989 to provide comprehensive employer sanctions information However, according to an INS official, the proposed system was 

not implemented primarily because of inadequate funding. Further, had 

the funds been provided, they would have been used to (1) purchase 

computer equipment, (2) resolve software development problems, and 

(3) provide training for field personnel. 

As an interim solution, INS modified the manual system and tested the 

proposed changes during August 1989. We reviewed the modification 

Page 97 GAO/GGD9082 Employer Sanctions 
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INS and Labor Have Generally Met Their 

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IRC.JI Satisfactorily 

and found that when implemented, it would include most of the missing 

information discussed above and should improve INS' ability to monitor 

the program. However, as of February 1990, according to INS officials, 

the modified manual system was not fully implemented, and the management information discussed above was not available. Even when 

fully implemented, INS officials view the modification as a short-term 

solution to the long-term requirement for an effective employer sanctions information system. 

A ’ pects of IRCA 

I r-l! i plementation That 

Ate Not Included in 

“Satisfactorily” 

Carrying Out the Law 

Ihployers’ Overall Comparing our 1988 and 1989 survey results shows a significant nationVoluntary Compliance Has wide increase in voluntary compliance with the I-9 requirement. Our 

In&eased Significantly 1989 survey estimate shows that 1.58 million (about 65 percent) of the 

2.42 million employers in our survey population who were aware of the 

law and hired at least one employee during 1988 completed an 1-9 form 

for each employee hired as the law required, compared to 50 percent in 

our 1988 surveyY An additional 167,000 (7 percent) of the employers in 

our 1989 survey said they had completed some but not all required I-9s, 

and the remaining 668,000 (28 percent) said they had not completed any 

1-9s for employees they hired. Table 5.2 shows employer compliance by 

geographic area. 

“If employers who hired one or more employees during 1998 but were not aware of the law are 

included, WC‘ estimate the compliance rate is 57 percent. 

Page 98 GAO/GGD-SO-62 Employer Sanctions 
Table 5 

Area 

Chapter 5 

INS and Labor Have Generally Met Their 

Responsibilities to Carry Out 

/ IRCA Satlsfact4wlly 

, 

i,f: l-9 Compliance by Wographic 

Figures in percent 

- 

/ Compliance level 

.__- ---- 

/ Rest of west 76 ---_--^~--- 

Texas 75 

--~----- 

- 

-- 

California (excluding Los Angeles) 71 

____- 

Miami -I_-- 70 

-----___ ______ 

Chicago 6s 

-_--...-- -- __. 

New York City 66 

----__--.-_-..-_.. ----- 

Los Angeles 61 

-_- ..-. -..-- - 

Other states .E 

Source: GAO 1989 Employer Survey. 

Employers who were not in compliance more frequently 

. hired 10 or fewer employees during 1988, 

l had 10 or fewer employees as of December 31, 1988, 

. did not have any I-9 forms, 

. had not been visited by INS and did not expect to be visited, or 

l did not clearly understand the i-9 verification requirements. 

Many Employers Hiring 

UnaGthorized Aliens Did 

Not qomplete 1-9s 

INS interviewed 886 unauthorized aliens who were apprehended at work 

during August and September 1989. These interviews and the subsequent inspection of their employer’s I-9 forms indicated that many 

employers who hired unauthorized workers did not complete an 1-9 for 

each. INS inspected employer records for 500 of the 886 unauthorized 

aliens who were hired after IRCA’S enactment and should have had 1-9s 

done onthem. However, INS’ inspections of employers’ records revealed 

that 278 (56 percent) of the 500 aliens did not have completed l-9 forms 

on file. In addition, 354 (41 percent) of the 869 aliens who responded to 

our survey said their employer did not ask for work authorization 

documents. 

Conclusions We found that INS and Labor have generally met their responsibilities 

for carrying out employer sanctions satisfactorily. INS has identified violators, issued over 8,800 fine notices and warnings, and prevailed in all 

431 closed cases where employers requested a hearing to challenge the 

INS sanction. Labor has conducted over 77,000 I-9 inspections and is 

reporting the results of inspections to INS. However, we identified 

needed improvements at INS. 

Page 99 GAO/GGD-9042 Employer Sanctions 
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INS and Labor Ii&we Generally Met Their 

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Employer sanctions’ effectiveness will increase to the extent employers 

are aware of the law, understand the i-9 requirement, and comply voluntarily. After considerable government education efforts, 83 percent of 

the nation’s employers reported awareness of the law. On the basis of 

our 1989 survey, an estimated 1.7 million employers said they believed 

the government’s education program was helpful. Although voluntary 

employer compliance has increased, 35 percent were still not fully complying with the l-9 requirement. We believe this non-compliance level 

suggests a lack of employer understanding of the legal requirements. 

INS does not routinely reinspect employers who hired unauthorized 

aliens to see if they are in compliance. The reinspections that INS has 

done show that some employers after having been fined continue to 

employ unauthorized aliens. Without systematic reinspection, INS cannot 

know if the employers have come into compliance. INS also does not fully 

document key decisions made during the sanctions investigation, thus 

hampering reinspections. 

INS’ only method to measure employer compliance is GAP. However, the 

GAP General Inspection Program plans to use more resources than necessary to measure compliance. In addition, the GAP Special Emphasis Program does not, as it was intended, permit INS to generalize the employer 

compliance results to specific industries and areas of the country. If 

modified as we propose, some INS resources currently planned for use in 

GAP could be reallocated to investigations of employers suspected of 

employing unauthorized aliens. 

INS does not have an automated employer sanctions information system 

that can provide much of the information needed to manage the law’s 

implementation effectively. Although INS officials have said that implementing an automated service-wide system is a high priority, sufficient 

funds have not been allocated. 

Recommendations We recommend that the Attorney General require the Commissioner of 

INS to 

l Begin to reinspect employers of unauthorized aliens to determine if they 

have come into compliance. 

l Document in the official case file the major events that occurred during 

the sanctions investigation, such as (1) whether the employer was educated about the law’s requirements and (2) the reason(s) for changes in 

Page 100 GAO/GGD90-62 Employer Sanctions 
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INS and Labor Have Generally Met Their 

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IRMA Satisfactorily 

the fine initially assessed that could affect the penalties for subsequent 

violations. 

. Modify the GAP program to provide reliable measures of employer compliance in various industries, nationwide, and within INS regions. GAO'S 

proposed sampling plan is one way to obtain these reliable measures. 

. Establish an automated employer sanctions information system that can 

be used to more effectively implement the program. 

I 

Agefcy Comments 

/ I 

We discussed our findings and the basic thrust of these recommendations with INS officials and they were generally receptive to making 

improvements along these lines. 

Page 101 GAO/GGD-90-62 Employer Sanctions 
@CA Has Not Created m Unnecessary or 

I&reasonable Regulatmy Burden for Employers / 

Congress was concerned about the extent of regulatory burden the sanctions provision placed on employers by requiring them to complete 1-g 

forms for all new employees. The law requires us to report on whether 

this regulatory burden is “unnecessary,” but does not define the term. In 

the absence of definitive legislative guidance, we established our own 

criteria-that the principal burden resulting from the sanctions provision (i.e., preparation of an I-9) would be unnecessary if it could be 

proven that the law was ineffective. We defined ineffective as failing to 

significantly decrease the employment of unauthorized aliens and/or 

their flow into the United States below what the levels would have been 

without the law.’ 

Nearly all the evidence suggests that IRCA has reduced illegal immigration and employment. Thus, by our definition, the burden from the sanctions provision is not unnecessary. While INS interviews of unauthorized 

aliens apprehended at work showed many had fraudulent or counterfeit 

documents (see ch. 3), the data in this chapter suggest that many other 

unauthorized aliens without such documents were unable to find work 

because of the law’s verification system. 

Congress was also concerned that IRCA’S antidiscrimination provision 

might be used by private groups to harass employers, thus creating an 

“unreasonable” burden. We did not find any evidence that this occurred. 

We estimate that the cost of preparing the 1-9s would have ranged from 

$69 million to $138 million if all of the 4.6 million employers in our survey population had fully complied during 1988. 

‘Six countries and Hong Kong have reported that if they had not enacted employer sanction laws, the 

problem of aliens working illegally would be greater than it was. 

Sclccted Countries’ Employment Prohibition Laws (GAO/GGD8 

Page 102 GAO/GGD-9082 Employer Sanctions 
Chapter 6 

IRCA like Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

Law Appears to Be 

Reducing Illegal 

Imrnigration and 

Employment 

Emp$yer Survey Results Fifty-five percent of employers said they were aware of the law and had 

Suggt st the Law Has Beer 

6 

1 no basis to judge whether the law was effective in reducing unauthoParti lly Effective rized alien employment in their industry. However, of the remaining 45 

I percent who reported that they were aware of the law and had a basis 

/ to judge the law’s effectiveness, more than half said they believed that / 

I employer sanctions had reduced unauthorized alien employment in their 

industry. Specifically, 20 percent said they believed the law has been 

effective to a “very great” or “great” extent in reducing the number of 

unauthorized aliens working in their industry. An additional 36 percent 

said it was effective to a “moderate” or “some” extent; 44 percent said 

it was effective to little or no extent. 

Alieti Interviews Suggest 

the L;aw Has Made Finding 

Work More Difficult 

INS interviews of unauthorized aliens apprehended at work during 

August and September 1989 suggest that the law has made it more difficult for some to find jobs. Specifically, 135 of the 864 apprehended 

aliens (16 percent) hired since the law’s enactment said another 

employer had refused to hire them because they could not show work 

authorization documents. Further, 80 of the 135 aliens reported being 

refused employment on more than one occasion. 

Surveys of Mexicans 

Suggest the Law Has 

Dete#red Immigration to 

the Cfnited States 

A private research firm’s August 1989 survey in 42 randomly selected 

towns and cities across Mexico suggests that the law has begun to deter 

immigration to the United States.” Specifically, the survey found that 62 

percent of the Mexicans said recent changes in U.S. immigration laws 

discouraged them from going to the United States, 21 percent said the 

changes had no effect, 10 percent said the changes encouraged them to 

go to the United States, and 7 percent were not sure or refused to 

answer. 

‘The survey was done for the Los Angeles Times by Belden & Russonello Research and Communications of Washington, DC., with field work under the direction of Prospective Estrategica, AC. of 

Mexico, D.F. The survey of 1,836 persons has a margin of error of ? 3 percent at the 95 percent 

confidence level. 

Page 103 GAO/GGD-90-62 Employer Sanctions 
Chapter 6 

lltC.4 Has Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

The changes in the law seemed to have had more of a deterrent effect on 

aliens who had prior experience migrating to an area with a large alien 

population. Sixty percent of those who had previously been to the 

United States reported being discouraged from immigrating by the 

recent changes in the immigration law. Sixty-six percent who had previously been to California and 75 percent who had been to Los Angeles 

said that changes in the law had discouraged them from immigrating. 

Urliversity of California 

Su’ vey of Mexicans Shows 

M : derate Deterrent Effect 

, / 

The Center for US-Mexican Studies at the University of California at 

San Diego did a survey in three rural Mexican communities between 

July 1988 and January 1989. For the 107 respondents who had previously immigrated to the United States without documents at least once 

since 1982,39 percent said that they considered going to the United 

States but decided not to go because of such IRCA-related problems as 

fear of not finding work. Seventeen percent of another 125 people surveyed who had never been to the United States decided not to go 

because of IRCA or because of the lack of papers required to find work. 

About 85 percent of the total 232 persons in both groups of prospective 

immigrants believed that it was more difficult to get work now because 

the law requires employers to ask for documents. However, 63 percent 

of the recent undocumented migrants and 71 percent of the prospective 

immigrants believed it was still possible to get a job in the United States 

without papers. 

The study also concluded that the populations of sending communities 

have a very high level of knowledge about IRCA. All those who had been 

to the United States knew how employer sanctions were supposed to 

work. Seventy-eight percent of those who had never been to the United 

States knew about employer sanctions. 

Urban Institute Says the 

La)v Has Deterred Illegal 

Migration 

A July 1989 study by the Urban Institute found that IRCA has slowed 

illegal immigration across the U.S. southern border.:’ The study analyzed 

monthly data on Border Patrol apprehensions from January 1977 to 

September 1988 using a model that included various factors other than 

the law (e.g., changes in the Mexican economy). We analyzed the methodology and found it sound.’ 

“The U.S. Immigration Reform and Control Act and Undocumented Migration to the United States, 

IJrban Institute, Washington, DC. (PRIP-UI-5, July 19, 1989). 

“We did not analyze the methodologies used in the other studies discussed in this chapter. 

Page 104 GAO/GGD-90-62 Employer Sanctions 
Chapter 6 

IRCA Has Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

The study estimated that the number of border apprehensions between 

November 1986 and September 1988 declined nearly 700,000 (about 35 

percent) below the level that would be anticipated without IRCA. The 

study attributed most of this decline to IRCA’S employer sanctions’ deterrent effect (71 percent). The remaining decline in apprehensions was 

attributed to the agricultural legalization program (17 percent) and 

changes in the INS effort (12 percent). 

Rand 

4” 

tudy Finds 

Sanct’ons Reduced Illegal 

Immi ration Initially but 

Long-’ erm Effect Is 

Unclear 

I 

In December 1989, the RAND Corporation provided us with the preliminary results of its ongoing research. To assess the effects of the sanctions provision on illegal immigration, RAND developed a model to 

predict what apprehensions would have been without IRCA and compared the predictions to the actual data. RAND assumed that if the sanctions provision was effective, one would expect to see a decrease in 

apprehensions of illegal aliens and fewer tourist visas being requested 

as potential undocumented immigrants refrain from entering the country. The researchers also expected to find increases in guest worker 

applications, applications for asylum, and applications for permanent 

immigrant visas as potential illegal immigrants search for legal means to 

immigrate. Also, RAND reasoned that wages in labor markets with large 

alien populations should rise if the supply of undocumented workers 

declines. 

Analysis of these indicators suggests that in fiscal year 1987, illegal 

migration was reduced by up to 20 percent because of the sanctions provision. In fiscal year 1988, this deterrent effect may have disappeared. 

Fiscal year 1989 results are mixed. Depending on the assumptions 

employed, it was found on the basis of INS apprehension data that there 

were up to 30 percent fewer illegal border crossings.s Several other 

indicators, such as asylee and guest worker applications and tourist 

visas issued, suggest a marginal decline in illegal immigration, However, 

the labor major market survey indicated no decline in the supply of 

undocumented labor. 

University of Chicago 

Study Does Not Confirm 

Illegal Immigration 

I 

The Population Research Center of the University of Chicago surveyed 

Mexican towns before and after IRCA and found no evidence that the law 

had lowered illegal immigration or greatly increased the costs or difficulty of illegal entry. The study concludes that IRCA appears to have 

‘The RAND model factored out apprehensions that would have been generated by amnestied aliens 

and accounted for changes in Border Patrol resources. 

Page 106 GAO/GGD-9082 Employer Sanctions 
- 

St; 

thl 

su 

InI 

chapeer 6 

INCA Has Not, Created an Unneceeeary or 

Unreasonable Regulatory Burden 

for Employers 

- 

increased aliens’ use of professional smugglers to cross the U.S. border 

illegally, and this has lowered the apprehension rate. The study used 

data from two Mexican community surveys in 1982-83 and 1987-88. 

‘f From the Bureau of 

Census Report That 

/ey Results Are 

Inclusive 

The Current Population Survey (CPS) is a monthly survey of about 

58,000 households nationwide which is funded by the Bureau of Labor 

Statistics and conducted by the Bureau of the Census. In September 

1989, Census staff reported on their analysis of data on the foreign-born 

population collected in the cps for November 1979, April 1983, June 

1986, and June 1988.” The report concluded that it was not possible to 

make a determination from the available evidence whether IRCA had 

reduced the flow of undocumented immigrants below the pre-Iacl\ 

estimates. 

There was no evidence that the level of average annual population 

change due to undocumented immigration for the 1986-88 period is different from previous pre-IRcA periods. The report stated that CPS is limited in its ability to assess IRCA’s effects and that a complete evaluation 

may not be feasible without a longer observation period or more precise 

data and methods. 

GAO Indicators of 

Employer Sanctions’ 

Effectiveness 

Using the following indicators, we also analyzed the extent to which the 

sanctions provision appears to be achieving the congressional objective 

of reducing unauthorized alien employment and immigration to the 

IJnited States: 

l the rate that INS apprehends unauthorized aliens adjusted for the level 

of enforcement, and 

l the extent employers rely on legal la.bor sources rather than unauthorized alien labor. 

Caution should be exercised in using these indicators primarily because 

changes may be influenced by factors other than employer sanctions. As 

a result, IRCA may not be the only cause of changes. For example, economic or political conditions in other countries can affect the flow of 

aliens into the United States. Accordingly, changes in the following 

indicators are only a rough gauge of employer sanctions’ effectiveness. 

“According to the authors, the views expressed in their report do not necessarily reflect those of the 

Census Bureau. 

Page 106 GAO/GGD-90-62 Employer Sanctions 
Chap&v 6 

WC4 Has Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

- 

pprehensions It seems to us that if employer sanctions are effectively reducing job 

opportunities for unauthorized aliens, fewer aliens will attempt to enter 

the country illegally to search for work. One measure of the flow of 

aliens entering the country is Border Patrol “linewatch” apprehensions 

measured by lo-hour shifts. Linewatch is a surveillance program at 

major crossing points at or near the border to apprehend aliens entering 

the country illegally. 

Figure 6.1 shows INS Border Patrol linewatch apprehensions measured 

by lo-hour shifts for the fiscal years 1983 through 1989. The data show 

that alien apprehensions per lo-hour shift decreased 46 percent after 

IHCA was passed in November 1986. 

--..-+..-- 

Figure .l: Border Patrol Linewatch 

Appreh $ 

Shifts j 

nsions Measured by lo-Hour 5.0 Avorsgs sppnhmslons psr lo-hour shlfl 

4.5 

1.0 

0.5 

o...- _. 

1983 1984 1986 1986 1987 

R888l yrr 

Note: 1989 represents 10 months of data 

Source: INS. 

1988 1seS 

If employer sanctions reduce the number of aliens employed illegally, 

then the number of alien arrests, adjusted for the level of enforcement, 

should decrease. INS records the number of aliens apprehended who 

were employed illegally per investigator hour. 

Figure 6.2 shows that, per investigator hour, INS arrests of aliens who 

were employed illegally have decreased 59 percent since IRCA’S passage. 

Page 107 GAO/GGD-90-62 Employer Sanctions 
Chapter 6 

IRCA Has Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

Figurp 6.2: Illegally Employed Alien Arrests Per INS Investigator Hour 

0.16 

0.14 

0.12 

0.10 

0.06 

0.08 

0.04 

0.02 

0 

; Arrastm par Invutigator hour 

Source: INS 

Reliance on Authorized If employer sanctions are effectively reducing the number of aliens 

Workers employed illegally, then the percent of nonimmigrants (visitors) who 

receive visas to enter the country each year but stay and become illegally employed should decrease. Figure 6.3 represents visa violation 

rates in fiscal years 1985-88, by 6-month periods. The data show the 

overall rate at which people were overstaying their visas has dropped 

21 percent since the 6-month period ending September 1986. 

Page 108 GAO/GGD90-62 Employer Sanctions 
Chapter 6 

IRCA Has Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

of Estim ted Visa Overstayers to 

Expecte f Departures 3.00 Penontege of vlsa violations 

2.75 

1.80 

1.26 

1.00 

0.73 

0.50 

0.25 

, 0 

, 

O&Mar 85 Apr-Sop85 OcbMar86 Apr-SopBg O&Mar 67 AprSsp87 O&Mar 88 Apr-Sop68 

&month intervals 

Source: INS. 

The Social Security Administration (SSA) issues special non-work Social 

Security cards to legal alien nonimmigrants who are not authorized to 

work but who need the number for other reasons (e.g., to open a bank 

account). If employer sanctions are effective, the percentage of nonwork Social Security numbers with wages reported to SSA should 

decrease after IHCA. Figure 6.4 shows the number of all non-work Social 

Security numbers that had wages reported decreased 8 percent following IIZCA’S enactment. Because there is a Z-year lag in SSA data (1987 

wages become available in 1989), the decrease is based on 1 year of 

post-IHCA data. (See fig. 6.4.) 

Page 109 GAO/GGD-90-62 Employer Sanctions 
Chapter 6 

IRC4 Has Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

Figl/re 6.4: Number of Non-Work Social 

Secbrity Cards With Wager Reported, 

188+89 

- 

2.60 Cards (mllllom) 

2.22 

2.00 

1.75 

1.50 

1.25 

1.00 

0.76 

0.0 

OZ!l 

0, . 

1993 

Yssr 

1984 1985 1986 1997 1999 1999 

- Non-work Social Security cards 

-1-1 Non-work SSNs with wages repotted 

Note: There is a 2 year lag between the year wages are earned and tha year they am reported to 

SSA (wages reported in 1989 were earned in 1987). 

Source: SSA 

IRCA-Related 

Employer Costs 

Employers in our survey reported that to complete an I-9 took an average of 7.5 minutes. This means that for employers who have labor costs 

of $10 per hour, each form would cost $1.25 to prepare. For employers 

with labor costs of $20 per hour, the cost is $2.50. 

We estimate that if all of the 4.6 million employers in our survey population had been in full compliance during 1988, completing all the 1-9s 

would have cost about $69 million using a $10 per hour labor cost and 

$138 million using a $20 per hour labor cost. The actual costs of completing 1-9s was considerably less, since only 65 percent of the employers 

surveyed who were aware of the law and hired one or more employees 

had fully complied. 

Table 6.1 shows the number of 1-9s that employers who were aware of 

the law completed. Employers may also photocopy the I-Q forms and file 

them for the required period of time. 

Page 110 GAO/GGD-9062 Employer Sanctions 
Table E 

--j------ 

, Chapter 6 

I IRC4 Has Not Created an Unnecessary or 

/ Unreasonable Regulatory Burden 

for Employers 

i. 1 : Number of l-98 Prepared 

Number of l-98 prepared 

Percentage of 

employers ~.--~- 

None 26 _--_-.. ____- -- ___-- --. 

5 or less 34 --^-~ -- _-- ~.- 

6-10 13 

.-------------- -___ ---.- -.---...~-- 

11-20 11 

-__- -- 

21-50 7 

-.---~~ --~ 

51 or more 9 

As shown in table 6.1, more than half of the employers said that they 

prepared fewer than six I-as. 

In addition, IRCA costs employers time and money when they interview 

job applicants who cannot be hired or when they have to delay hiring 

because the applicants have to obtain the required work authorization 

documents. On the basis of our survey, we estimated that 196,000 (7 

percent) of the projected 2.9 million employers who responded wanted 

to hire someone during 1988 but did not because the person could not 

present a work authorization document. We do not know if the persons 

not hired were citizens, authorized aliens who lost their documents, or 

unauthorized aliens who did not have fraudulent or counterfeit documents to show the employer. 

Employer Cornments Eight hundred and nine employers (or 18 percent of the respondents) 

on the Law’s Burden wrote comments on the questionnaire. Of these, 44 (or 5 percent) of the 

comments supported IRCA’S enactment, 2 10 (or 26 percent) were opposed 

to the law, and the remaining 555 (or 69 percent) were not substantive 

or were miscellaneous comments. The two most commonly cited reasons 

for opposing the law were (1) the paperwork burden and (2) problems 

with documentation. The following are typical of employer views provided in our survey: 

. “We have loo-120 people per year for the purpose of picking fruit. Our 

season lasts for 2 to 3 weeks. . . . Checking this many people for such a 

short work-time is very difficult. . . . There should be an easier way for 

growers with perishable fruit to hire legal workers.” 

. “The new immigration act is just one more of a growing list of rules, 

regulations, laws, requirements, etc. for a business to comply with. A 

small business like mine is fast becoming unprofitable because of the 

cost.” 

Page 111 GAO/GGD-W-62 Employer Sanctions 
Chapter 6 

I%4 Hae Not Created an Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

. “I have lost good candidates for employees because they could not get 

the necessary documents together and found work elsewhere apparently 

without documents.” 

. “The I-9 has become an expensive, time-consuming part of doing business. Simplification or elimination would not be missed by most.” 

l “Of all the multitudes of government forms that I have to process, the I-9 

is the most simple and clear-cut.” 

Non Evidence of According to Chairman Rodino, the congressional conferees were appreFri-volous Complaints hensive that IRCA’S antidiscrimination provision might be used by private groups to harass employers and thus be an unreasonable burden on 

employers. 

Using IlzcA-related EEOC data and osc charges filed since the law’s passage, we did not find that special interest groups were abusing the law. 

While a few individuals have filed numerous charges against employers, 

generally special interest groups have not. Congress included a provision for awarding attorneys’ fees to the prevailing party if the losing 

party’s argument “is without reasonable foundation in law or fact.” This 

particular language was intended to discourage lawsuits that harassed 

employers. As of December 1989, according to a Justice official, no losing party in a case involving IRCA’S discrimination provision has had to 

pay the prevailing party’s attorneys’ fees. 

Conclusions Nearly all the available data suggest that IRCA has partially achieved its 

objectives of reducing illegal immigration and employment. Thus, the 

burden that employer sanctions place on employers, though viewed as 

cumbersome by some employers, cannot be considered unnecessary. 

However, more time is needed to determine if IRCA’S beneficial effects 

will be lasting. 

l Our survey found that more than half of the employers who are aware 

of the law and have a basis to judge its effectiveness believed the law 

had reduced the number of unauthorized aliens working in their 

industry. 

. About 16 percent of aliens apprehended during employer sanctions 

investigations during August 1989 and September 1989 reported that 

they had difficulty finding a job because of IRCA’S employment verification system. 

l Two surveys in Mexico found many people believed the law made it 

more difficult to find a job in the United States. 

Page 112 GAO/GGD-90-62 Employer Sanctions 
Chapter 6 

IRCA Has Not Created au Unnecessary or 

Unreasonable Regulatory Burden 

for Employers 

l Using statistical models, one private research organization (Urban Institute) concluded that the law has slowed illegal immigration. 

l INS’ alien apprehension rate, adjusted for resource changes, has 

decreased since 1986. Our other statistical indicators of employers’ reliance on unauthorized aliens also show decreases under IRCA. 

It appears that fewer unauthorized aliens are entering the country than 

would have been without the law, thus making necessary the law’s 

burden. 

Because there is no evidence to suggest that IRCA'S antidiscrimination 

provision has been used by private groups to harass employers, it is not 

an unreasonable burden. 

Page 113 GAO/GGD-9982 Employer Sanctions 
Appkndix I 

FI/xal Year 1988,1989, and 1990 INS Budgets 

f6r Employer Sanctions 

Dollars in thousands 

--._ 1 ..__...............___..... ..- _..-.-_ 

i 

1988 1989 1990 

INS o lice FTEa Amount FTE’ Amount FlE* Amount 

81 $4,661 135 $6,184 135 $6,478 

450 20,142 500 19,721 500 27,117 

-- --~ -_ 

34 1,805 38 1,970 34 1,970 

. -.-..-_-” _.__-. ~ - 

218 12,293 242 13,169 218 14,108 

. ..__._ .-. _...._ ._--.---~ 

7 391 8 428 8 432 

2 6,099 2 5,519 2 5,353 

- 

86 2,546 96 2,352 96 2,352 

7 264 8 289 8 293 

0 3,012 0 3,012 0 3,012 

153 7,214 170 8,315 170 8,315 

- 

Executive Direction 6 378 7 413 7 420 

28 936 31 1,192 31 1,488 

1,072 $59,741 1,237 $82,584 1,209 $71,338 

aFull-time equivalent positions 

Source: INS. 

Page 114 GAO/XX%9082 Employer Sanctions 
PW, . 

bz;y of Employers) Reactions to the 1986 

Irrhigration Reform md Control Act 

U.S. General Accounting Office 

Survey of Employers’ Reactions 

to the 1986 Immigration Reform 

and Control Act 

The U.S. General Accounting OfTice, an agency of the Congress, is required by law to gather information on how the 

Immigration Reform and Control Act of 1986 has affected 

employers. Your participation in this survey is voluntary, but 

your frank and honest answers are greatly needed so that we 

can advise Congress on the problems employers face and recommend any needed improvements. 

This questionnaire ie anonymow. There ia nothing in 

this form that can identify how you or any other firm responded. 

In order to ensure your privacy, we ask that you separately 

return the enclosed post card indicating that you have completed your questionnaire. We need these cards returned 80 that 

we can follow up with those who do not respond to our mailing. 

The questionnaire should be answered by the person most 

knowledgeable about hiring practices at the location to 

which our cover letter was addressed. The questions can be 

easily answered by checking boxes or filling in blanks. The 

quextionnaire should take about 20 minutes to complete. Space 

has been provided at the end of the questionnaire for any additional comments you may want to make. If needed, additional 

pages may be attached. If you have any questions, please call 

Ms. Linda Watson or Mr. Alan Stapleton at (202) 357-1007. 

PleaBe return the completed questionnaire in the enclosed 

pre-addressed. pre-paid envelope within lOdays of receipt. Also, 

do not forget to mail back the post card, separately. Do not 

enclose the post card in the envelope with the questionnaire. In 

the event the envelope is misplaced, our return address is: 

U.S. GENERAL ACCOUNTING OFFICE 

Mr. Alan Stapleton 

441 G Street, N.W., Room 3660 

Washington, D.C. 20648 

Thank you for your help. 

Alan Stapleton 

lndustrv 

N=4,563#30 

tiqh - 13.4% 

Madiua - 24.5% 

Lot4 - 61.2% 

Aqriculture - 1.1% 

Location 

N=4,%3,000 

Chicago - 3.2% 

Hiani - 1.1% 

Los Angeles - 3.m 

New York City - 4.7% 

CA, LA excluded - 6.5% 

Texas - 6.0% 

Fleet of West - 11.1% 

Other atatsa - 56.X 

Agriculture - 1.1% 

Definitions for Thie Survey 

Firm-The employer’s establishment, at the location to 

which our cover letter is addressed. 

Authorized ALien-A person other than one naturalized or born in the United States who has documents 

authorizing employment in the United States. 

Unauthorized ALien-A person other than one naturalized or born in the United States who does not have 

documents authorizing employment in the United 

States. 

k Hiring 

a. Is the address to which this questionnaire was sent the only 

one at which your firm does business, or does your firm have 

other locations? (Check one.) 

1. c] This is the only location (Go to Question 1, 

page 2.) 

2. •I] F’ wm has other locations (Continue to b, 

below.) 

b. Where does hiring take place for employees who work at 

this location? (Check one.) 

1. 0 All employees are hired here (Go to Question 

1, page 2.) 

2. 0 Some employees are hired here, some at 

another location (Go to Question 1, page 2. 

In answering all the questions about 

hiring, please refer only to hiring that 

takes place at this location.) 

3. c] All employees are hired at another location (Go 

to Note below.) 

Note: If all hiring for this location is done at another place, 

please write the name, title, Arm, and address of the person 

who is responsible for hiring activities. Please return the 

entire package (including the post card) to us in the 

enclosed pre-paid envelope so that we can remove your 

name from our mailing list. Thank you for your help. 

Name: 

Title: 

Firm: 

Address: 

Page 116 GAO/GGD-9082 Employer Sanctions 
Appendix II 

Survey of Employers’ Reactions to the 1086 

Immigration Reform and Control Act 

8. NEW HIRES AND APPLICANIS 

1. About how many new employees did your firm hire - 

during 1988? (ENTER NUMBER, INCLUDING PART-TIME 

EMPLOYEES. If NONE, ENTER *qO@l AND SKIP TO 

OUESIION 11.) 

0 - 34.4% 

l-3 - 20.9% 

Na4.393.mO New hires I” 1988 4-25 - 20.5% 

26.b - 0.2% 

2. for about how many of these new employees hlred - 

during 1988 did your Firm complete Employment 

Ellglbillty Verification (I-9) Forms' (CHECK 

ONE.) 

N:2,929,mO 

57.1% 1. All (SKIP IO QUESIION 5.) 

3.1% 2. Host 

1.5% 3. About half 

1.5% 4. Some A- 

>(SKIP TO 

pufsrloN 4.1 

36.9% 5. None (CONTINUE TO 0UfST10~ 3.1 

3. IF your firm did not complete an 1-9 form For eny 

- 

new employees in 1988, which of the following 

rea*on*, if eny, explelne why. (CHECK ALL THAT 

APPLY.) 

Nsl,ZOl,aM 

58.2x 699,lNNl 1. Did not know whet I-9 forms were 

25.7% 309,WO 2. Did not have eny 1-9 forms 

14.2% 170,000 >. Did not feel that I should have to 

do this 

2.0% 24,ala 4. loo much difficulty obtaining I-9 

forms 

1.0x 12,000 5. The I-9 form takes too long to 

complete 

.9% 10,ooo 6. The I-9 forms were completed by 

another orgenizstion 

24.5% 294,LMKl 7. Other (specify) 

1 SKIP IO QIJESTION 5. 1 

a 

4. Which of the following reeeons, if eny, explains 

why I-9 Forma were completed for come of the 

employees hired in 1988 but not forthere? 

(CHECK ALL THAI APPLY.) 

N.l,379,ooO 

6.X 87,000 1. Only completed I-9 Forma if 

person wee unknown to Firm 

2.X 31,000 2. Only completed 1-9 forms for 

persons who were auepected of 

being unsuthorlzed allens because 

of Foreign appcerance or accent 

1.3% 18,ooLl 3. Some I-9 forms were completed by 

another organization 

1.5% 21,000 4. Only completed I-9 forms for pereons 

authorized to work 

IO.% 142,000 5. Other (specify) 

5. During 1988, were there eny people your firm had 

wented to hire, but who were not hired, because - 

they could not present documents showing 

eligibility to work in the United States? (CHECK 

ONE.) 

Y=2,915,LNHl 

6.7% 1. Yes 

91.m 2. No 

2.2% 3. Don't know 

6. In 1986, did your Firm look et documents showing 

eligibility to work 1” the United States before 

making e job offer to en appllcant7 (CHECK ONE.) 

7e.m 1. No (SKIP TO OlJESlIDN 8.) 

3.x 

-4% 

2. Yea, of some applicants3. Yea, of about half 

the applicants 

2.6% 11. Yes, of most applicants 

15.6% 5. Yes, of 811 applicants - 

+(CONTINUE 

IO 

QUESTION 

7.) 

YOUR ANSWERS ARE ANONYMOUS. 

Page 116 GAO/GGDOO432 Employer Sanctions 
Appendix II 

Survey of Employers’ Reactions to the 1986 

Immigration Reform and Control Act 

Y Averege 24 

7. Whxh of the following reasons, If' any, explains 11. Since November 6, 1986, has the Immigration and 

*hy your firm looked tit job eppllcants' work Naturalization Service (INS) visited your firm 

ellglblllt) documerlts before making B job offer? 

(CHECK ALL THAI APPLY.) 

for any reason? (CHECK ONE.) 

N=4.489,QW 

N=787.m0 

3!4 1. Yea (CONTINUE To w~sTlohi 12.) 

21.2% 167,ClOQ 1. It 1s easier to ask for documents 

before hlrlng someor% 94% 2. ho 

>(SKIP IO QUESTION 13.) 

27.2% 214,000 2. It wastes my firm’s time and money 3% 3. Don't know 4 

to otfer II Job to someone who cannot 

legally be hired 12. For which of the following reesona, If sny, did 

INS visit your flm? (CHECK "YES," "NO," OR 

9.6% 77,QQO 3. Applicant's forelgrl sppearilnce or "DON'T KNOW" FOR EACH REASON.) 

acceflt made the firm suspect the 

persorl might be 811 unauthorized alien ooll’t 

Yes No khow 

M.% 401,QDQ 4. My tlrm bellwed this 1s required by REASONS FOR INS VISIT (1) (2) (3) 

law 

1. lo educate your firm about 

2.1% 16,000 5. Other (speclty) the 1986 immigration law 

Nnl27,MlO 86.1 10.4 1.5 

8. It 1s unpoav~hle for employers to krrow for wre If 

the wu!k rllglblllty documents they we shuwrl are 2. lo review I-9 forms 

gerlulne. Do you belleve that ar,y or the employees N= 80,DOO 65.3 25.8 0.9 

your term hired during 1988 preserrted documents 

thtrt might have beer8 flvudulent or counterteltT 3. lo determine if your firm 

(CHECK olrc.) employed unauthotized allens 

Hz 6~,QOQ 25.3 54.9 19.0 

N=2,845,RKl 

4. Other (please specify) - 

.5% 1. oeflnrt.ely yes 

N= 17,000 50.1 26.0 23.2 

1.1% 2. Probebl, yes 

5.1% 3. Uncerte1n 13. Does your firm expect to be the subject of an INS 

inspection during the next 12 months’ (CHECK 

20.1% 4. Probably 110 ONE.) 

50.7% 5. Deflnltely no N=4,422,UlO 

_ __ _ - _ _ - _ - _ - - 

22.x 6. No baais to judge .I 1. Definitely yes 

9. About how molly minutes does It generally take 3% 2. Probably yes 

your fern to complete an 1-9 form7 (IF YOUR FIRM 

DID NOI COMPLEIC ANY I-9 f-OR&, PLEASE PLACE AN X 6.E 3. Uncertain 

IN THL SPACE EELOW.) 

26.1% 4. Probably "O 

Avsrqle 7.5 Minutes to complete the I-9 form 

29.2% 5. Definitely no 

10. About how marly I-9 forma did your firm complete - -- - - - - - - - - - - 

for employees hlred durlrrq 1988? (ENTER NUMBER OF 36.8% 6. No bssls to judge 

t0RMS.j 

1-9 terms completed 

I YOUR ANSWERS ARE ANONYMOUS. I 

Page 117 GAO/GGD-BB-62 Employer Sanctions 
- 

- 

Appendix II 

Survey of Employers’ Reactions to the 1986 

Immigration Reform and Control Act 

14. Lven omployere who fully complv with the law way 17. Which of the following roa”“n8, If any, sxPIains 

have some omployeos whu are unauthorized aliens. why employee(s) were fired or laid off during 

Do you aspect thut any of your current employees 1988? (CHECK ALL THAI APPLY.) 

might be unaulhor~zed alwna? (CHECK ONE.) N=l Jltl5,mO 

Nz4.456,lKW 44.5% 1. Not enough work wallable 

.1X 1. Oef1rutely yea - 

1 

68.1% 2. Employee did not adequately petform 

->(CONTINUE TO the work 

.6X 2. Plubably yw - OUL!,IIGN 15.) 

.2% I. Cmployee wau suspected of being an 

1.5% 3. Ullcett~lll --- unavthorized alaen because of foreign 

appaarance or accent 

11.4% 4. Probably no 

1 

>(SKIP 10 1.9% 4. Employee lacked proper work 

8>.8% 5. oeflnltely no QUESIION 16.) eligibility documents 

- -_ - - - - - - - - - 2.x 6. No hasls to Judge 6.0% 5. Other (specify) 

IS. About how many of the employees your firm suapecta C. REACTIONS TO THE 1986 IMMIGRATION LAW 

of being unauthorized aliens wwe hired before 

Novernbcr 7, 1986? (CHfCK ONE.) 18. Prior to receiving this questionnaire, how ware, 

If at all, was your firm that a new lmmlgratux~ 

N=J5.000 law was passed in 1986 calling for penalties 

(sanctions) against employers who knowingly hire 

20.6% 1. None unauthorized al~on”? (CHECK ONE.) 

N:4,47O,Mo 

33.2% 2. Some 

13.6% 1. No arareneaa (SKIP 10 OUESIION 24.) 

5.8% 3. About half 

16.0% 2. Somewhat aware - 

9.1% 4. Most 

23.95 3. Moderately aware 

19.8% 5. All >(CONTlNUf 10 

- - _ _ _ - _ _ _ 24.2% 4. Greatly aware 

&I 

QUESTION 19.) 

13.5% 6. Don't know 

18.5% 5. very greatly awar 

16. During 1988, did your firm fire or lay off any - __ - - _ - - - _ - - _ _ 

employees' (CHLCK ONE.) 5.8% 6. Don't know (SKIP TO QUESTION 24.1 

N.4,462.m0 19. From which of the following sources of 

information, If any, have you obtained lnforaatlon 

40.0% 1. YWW (CONIIN~~~ 10 4mr10N 17.) about employer penaltiea (sanctions) in the 1986 

immigration law? (CHECK ALL THAI APPLY.) 

59.3% 2. No- N=5,787@0 

>(SKIP TO QUCSlION 18.1 

.l% 3. Don't know -l- 27.3% 1 ,ow,OOO 1. Immigration and Naturallzatlon 

Sarv~ce (INS) Handbook for 

Employers 

18.8% 1,468,mO 2. I-9 Form (Employment Ellgiblllty 

Verlflcation) 

8.5% X2,OCMl 3. INS regulationa 

18.2% 689,ooo 4. Trade aaaociation or Chamber of 

Commerce 

57.2X 2,168,m0 5. Radio, television, newapclpcrs, 

magazines 

15.4% 582,000 6. Other (specify) 

Page 118 GAO/GGD-9082 Employer Sanctions 
Appendix II 

Survey of Employers’ Reactions to the 1986 

ImmijJration Reform and Control Act 

20. Beeed on the information your firm has reviewed, how clear OP unclear ape each of the following provision8 

of the 1986 immigration law? (CHECK ONf BOX IN EACH ROW.) 

Very Generally Marginally Generally very No basis 

cleflr CkW clear U”Clt-&V unclear to judge 

PROVISlOhS OF LAW (1) (2) (3) (4) (5) (6) 

1. The documents to be presented as 

evrdence of authorizatlorl to work 

N=3,565,WJ 33.5 26.4 12.5 7.5 4.5 15.6 

2. INS’s Employmetrt Eligibility 

Verlficatlon form (I-9) requirements 

N=3,547,fXXl 32.0 26.1 10.4 7.9 7.2 16.5 

3. Reot rict ions on employmerlt of 

unauthorized allens 

N=3,544,OW 27.0 26.6 16.0 6.9 6.5 15.0 

4. tmployer exsmptlon from penalties 

For hlrlng thst occurred before 

November 7, 1986 

N=3,S33,000 18.7 24.7 15.0 13.4 10.0 18.3 

5. Prohibltlons sgainst employers 

(ulth four or more employees) who 

dlscrimirlate 

N-3,542,000 18.8 22.0 14.8 14.7 9.4 20.2 

6. Deferrel of penalties for aeesanal 

agricultural employers 

N:3,504,000 8.1 12.4 13.6 14.5 12.1 39.3 

1. The IhS has conducted a campalg" to educate 22. In your opinion, to what extent, if at all, has 

employers about the employer sanctions provisions the employer sanctions provision of the 1986 

ut the 1986 immigration law. To do this, INS held immiqration law been effective in reducing the 

meetings in cltles acrow the country end made number of aliens working nlthout proper work 

annowcementa in the newspepers, on TV, and on the authorization documents UT your industry? [CHECK 

cadlo. lo what extent, If ~l"y, has your ONE.) 

organlratron's Fsmil~rrrit) with the lmmigratlon 

lew lrlcreased due to INS's edwatt"" efforts? N=3,646,mO 

(CHECK ONL.) 

2.5’; 1. Very great extent 

1=3+41,cuw 

6.2% 2. Great extent 

2.4% 1. Very great extent 

0.2% 3. Moderate extent 

8.8% 2. Greet extent 

7.8% 4. Some extent 

14.1% 3. Moderate extent 

20.0% 5. Little or no extent 

20.1% 4. Some extent __-_--__---__- 

55.2% 6. No basis to judge 

39.1 5. Little or no extent 

-------_------ 

14.72 6. No basla to Judge 

I YOUR ANSWERS ARE ANONYMOUS. I 

Page 119 GAO/GGD-90-62 Employer Sanctions 
Appendix II 

Survey of Employers’ Reactlone to the 1086 

Immigration Reform and Control Act 

23. Which of the following actions, if eny, wee taken et this location es a result of your firm’s underatandinq 

of the 1986 irnrniprstlon law? (CHECK “YES” OR “NO” TOR EACH AClIOh.) 

IMPORTANT; CHECK “YES” ONLY IF AClIOh TAKEN WAS A RESULI Of THE 1986 IMMIGRATION LAW. 

ACTIONS TAKEN 

1. Paid en attorney to explain the new law 

Yes No 

(1) (2) 

N=Y,261,ooo 3.1 96.9 

2. Provldsd treininq to supervisory employees on the new law N=3,29O,m0 23.0 76.2 

3. Began to hire only persons born in the Umted States N:3,181 ,Wll 14.7 es.3 

4. Begun e practice to not hire persons who have temporary work eligiblllty 

documents (for exsmple, temporary resident aliens) N=3,146,DDO 1 13.0 ) 87.0 1 

5. Begun to exemine documents of onlp those current employees whose foreign 

appearance or accent led the firm to suspect they might be unauthorized ellens 

N=3,146,m0 8.6 91.4 

6. Begun e prectice to not hire job applicants whose foreign appearance or accent 

led the firm to suspect they might be unauthorized aliens N:J,163.m0 6.6 93.4 

7. Increased wages to attract authorized workers N-3,167,000 3.6 96.4 

8. Decreased wages of unauthorized workers to compensate for costs essoclated 

with employer ssnctlons, such 88 fines end paperwork N=S,149,lXKl 0.2 99.0 

9. Begen or increased the uee of state employment agency to find workers 

N=3,169,WO 7.2 92.0 

10. Bsqen or lncrsesed the use of contract workers for work previously done by 

employees N:3,166,MMl 3.0 97.0 

II. Increesed price of goods or services Nz3,176,MO 3.6 96.4 

12. Began a practice to not hire persons who present Puerto Rican birth certificates 

N=3,154,WO 1.8 98.2 

13. Other (specify) Nz 426,000 18.1 81.9 

I YOUR ANSWERS ARE ANONYMOUS. 

Page 120 GAO/GGD-SO-62 Employer Sanctions 
Appendix II 

fhrvey of Employers’ Reaction6 to the 1086 

Immigration Reform and Control Act 

24. Which of the following actions, if any, do you think the federal government should consider regarding hiring 

practices? (CHECK ON; BOX IN EACH ROW.) 

- 

Y 

- 

1 

- 

Nefinitel C 

yes 

(1) 

Probably 

k-8 

(2) 

- 

Indecidec I 

(3) 

Probably 

(4nT 

Iefinitel 

(5n;l 

No basis 

to judge 

(6) 

55.3 22.1 4.3 1.0 

2.0 

0.5 16.0 

32.2 23.4 10.6 1.6 29.3 

47.5 23.9 5.7 2.4 

9.9 

1.6 18.8 

13.2 15.1 10.4 13.4 30.0 

18.5 10.2 5.2 2.3 36.8 

36.6 

19.0 

28.8 8.6 3.9 2.5 19.6 

45.2 28.2 5.4 2.5 3.7 15.1 

23.2 16.8 18.5 10.3 19.0 

15.9 17.8 22.0 

11.4 

9.4 7.0 27.9 

10.1 1.0 2.1 0.2 0.2 

C 

0 

+ 

AC1106 

1. Provide a way fur employers to quickly 

get enwere to their question8 about 

the new immigration law 

Ns4,179,fKKI 

2. Revise the I-9 form to list all 

acceptable work eliqlbllity documents 

N14,108,000 

3. Provide free I-9 forms at all U.S. Post 

Offices Ns4,183,000 

4. Print l-9 forms and instructions in 

other languages N=4,08B,lM)O 

5. Reduce the variety of work authorizstion 

documents that INS iaaues to aliens 

N:4,091,000 

6. Establish a nystem for employers to 

contact INS to verify if an alien 

is authorized to work N.4,159,mO 

7. Establish B system so employers could 

contact the Social Security 

Admlnlstration to verify that job 

applicants Saclal Security numbers are 

valid N=4,2DO,OOO 

El. Make the Social Security card the & 

work eliqlhlllty document persons ere 

permitted to present. Ndt,181 ,mO 

9. Make the documents INS isaues the onl_y 

work eligibility document aliens are 

permitted to present N=4,062,ow 

10. Other (epecifyf 

N=SBZJNB 

I YOUR ANSWERS ARE ANONYMOUS. 

I 

Page 121 GAO/GGD-9082 Employer Sanctiona 
Appendix II 

Survey of Employers’ Reactions to the 1986 

Immigration Reform and Control Act 

0. BACKGROUND 

25. In which of the following time periods did your 

firm start buslnees7 (CHECK ONE.) 

N=4,436.lNHl 

93.3% 1. Before November 1986 

4.5% 2. twvember 1986 through December 1987 

1.9% 3. 19BB 

cl% 4. 1989 

-- - - - - - _ - - 

0.2% 5. Don’t know 

26. About how many of your firm’s employees were e 

this locvtlon, on Decernbe! 31, 19BB? (EkTER 

NUMBER, INCLUDING PARI-TIMI: EMPLOYEES.) 

N=4,35J,ooO 

1-Y 54.1% -Employeea on December 31, 1988 

4-25 48.2% 

26+ 17.6% 

27. Pleaee estimate the number of‘ these employees nt 

this location, on December 31, 1988, in each of 

the followlnq cateqorlea. (ENTER ~utmi=is. Tttc 

TOTAL SHOULD EQUAL THE kUMBER OF CMPLOYEES ENTERED 

IN QUCSTIOk 26.1 

Number of 

employees 

1. Black (Non-Hispanic) R w%~ 

2. N1span1c 9% 8,545,aJll 

3. ASIan 3% 2,671 ,oca 

4. White (Non-Hlapenx) 782 m,7io,ooo 

5. other. (epeclfy) 

1% 929,oa.l 

TOTAL (mm of above) 91,155,ooa 

I E. COMMENTS 

28. If you have any comments on this survey, or on 

the 1986 immigration law, please write them in 

the space below. REMEMBER -- YOUR ANSWERS ARE 

PLEASE RETURN THE COMPLETED OUESTIONNAIRE IN THE 

ENCLOSED PRE-ADDRESSED, PRE-PAID ENVELOPE. 

ALSO, PLEASE RETURN THE POSTCARD, SEPARATELY. 

THANK YOU FOR YOUR HELP. 

YOUR ANSWERS ARE ANONYMOUS. 

J 

GGD/HS/3-89 

Page 122 GAO/GGD-99-62 Employer Sanctions 
Appendix III 

Te@wicd Appendix 

Employer Survey As part of our review of the implementation of IRCA, we wanted to determine the effects of the new law as perceived by U.S. employers. To 

accomplish this, we mailed a questionnaire to a stratified random sample of employers to gather information about their (1) understanding of 

the law, (2) employment practices, and (3) costs to comply with the I-9 

form requirements. Our sample was selected from a private marketing 

service’s database.’ We selected our sample from the database as it was 

constituted in February 1989. On that date, the database contained 

approximately 5.6 million employers. 

Sarn&ng Strategy To draw our sample, we first stratified the universe of employers into a 

66-cell matrix based on geographic area (16 strata) and industry (3 

strata) with a separate category for agriculture (8 strata). We designed 

a sample that is nationwide in scope but which oversamples employers 

from areas where a high proportion of Hispanics live and work. We 

oversampled to represent these areas adequately. The stratification 

includes the following cities and states that have a high Hispanic and 

Asian population: Los Angeles, New York City, Chicago, Miami, four 

small cities in Texas, California (excluding Los Angeles), Texas, New 

Mexico, Arizona, Colorado, and Hawaii. About one-third of the immigrants in the United States in 1980 lived in the four large cities in the 

sample. The two other geographic strata included the remaining western 

states and the rest of the United States.” Geographic areas were stratified based on 1980 census data. For purposes of analysis, the data for 

the 16 geographic strata were combined into 8 strata: (1) Los Angeles; 

(2) New York City; (3) Chicago; (4) Miami; (5) California, except Los 

Angeles; (6) Texas, including the four small cities in Texas; (7) rest of 

the west, which includes New Mexico, Arizona, Colorado, Hawaii, and 

the remaining western states; and (8) rest of the United States. 

We also grouped the employers in each of the 16 geographic strata into 

three approximately equal categories-those industries that had high, 

medium, and low levels of Hispanic and Asian employees as determined 

from the 1980 census data and County Business Patterns for 1986. We 

‘Several other databases exist that provide information about businesses in the Ilnited States, such 

as those compiled by the Internal Revenue Service, U.S. Census Rureau, and SRA. We chose the marketing service for the following reasons: (1) the data were purported to be more current; (2) the 

database identified each business location with an address, phone number, and the name of a business contact; and (3) the database could be accessed easily. 

‘Rest of the west includes Alaska Idaho, Montana, Nevada, Oregon, Utah, Washington, and 

Wyoming. 

Page 123 GAO/GGD-9062 Employer Sanctions 
- 

- 

/ 

- 

Appendix III 

Technical Appendix 

assumed that employers’ knowledge and compliance with the law may 

vary based on the level of immigrants employed in the industry. 

We selected a separate sample of agricultural employers. Agricultural 

employers’ knowledge and compliance with the law may be different 

from other employers because of the law’s exemption from sanctions for 

employers of seasonal agricultural employees until December 1, 1988. 

However, agricultural employers represented only about 1 percent of 

our universe sample, and, for most of the analyses presented in this 

report, employers in the agricultural strata were generally not different 

from other employers. Consequently, the employer responses for the 

agricultural strata are not reported as separate analyses but are always 

in the total. 

Due to technical difficulties and related issues concerning proprietary 

rights, we agreed to have the private marketing service draw the sample 

and certify that the sample selection procedure it used was a random 

one. We did not verify the procedure the private marketing service used. 

We based our cell sample sizes on a confidence level of 95 percent with a 

sampling error of 5 percent for nine major categories (superstrata). Generally, this resulted in required sample sizes of between 400 and 500 

employers per cell. Our target population for the survey was employers 

who are in business and have at least one employee. In our 1987 survey 

of employers, we found that approximately 30 percent of the employers 

who were listed on the database were no longer in business or had no 

employees. For this survey, we oversampled in each cell by approximately 30 percent to allow for a similar rate of unusable responses. 

Because of the size of the universe for “other industries and states,” we 

deliberately oversampled in this category in case a more detailed analysis of the responses from this group was necessary. 

Survey Response We mailed our questionnaire to 9,491 employers across the country in 

late April 1989. We did a follow-up mailing in June 1989. Finally, in 

August 1989, we telephoned those employers who had not responded 

and sent those who agreed to respond a third questionnaire. 

Of the 9,491 questionnaires mailed, 4,362 completed, usable questionnaires were returned. Our adjusted sample (subtracting from the original sample those employers whom we considered to be no longer in 

business or who could not be located and those who indicated they had 

no employees or that hiring was done elsewhere) was 6,317. Given the 

Page 124 GAO/GGD90-62 Employer Sanctions 
Appendix III 

Technical Appendix 

number of completed and usable questionnaires returned (4,362), this 

provided us with a response rate of 69 percent. Table III. 1 represents 

information on employer questionnaire disposition for each stratum. 

Table 111.1: Employer Questionnaire Disposition for Each Stratum 

Stratu Universe 

Hiring elsewhere or 0 Undelivered/out of Adjusted 

Samole emolovees business samole Resoonse 

Chlcagd-high 14,922 296 26 26 244 186 c . .._.. - _.-.. ..--.-~------- 

115,659 239 36 46 157 100 

..--- 

38,148 179 20 36 123 96 

168,729 714 82 108 524 382 

Miami-h/lgh 13,010 218 27 43 148 93 

Miami-k[w 

~--.--- 

16,437 243 34 51 158 115 

tiiami Miamijedium : 

26,614 254 27 69 158 82 

56.061 715 88 163 464 290 

LA-high! 31,003 434 67 73 294 193 

if\.& 

-- 

62,835 295 49 48 198 142 

iA”m~~ium. .._-. . -112,678 314 48 73 193 112 

Los An~eles 206,516 1,043 164 194 685 447 

NYC-high 28,801 236 18 44 174 96 

NYC-low 

.._~~~.. . 

66,282 220 28 30 162 93 

NYC-medium 

~- 

145,870 259 31 52 176 94 

New York City 240,953 715 77 126 512 283 

. . -..-.--.. -~.~ .--.. 

CA-high 62,633 521 90 97 334 246 

CA-low’ 

.-__- -- 

236,997 421 83 70 268 194 

-- 

~- 

CA-medium 172.824 418 71 84 263 188 

California 472,454 1,360 244 251 865 628 

C Chnsibhlgh 1,659 18 1 3 14 8 

ti Chnsivlow 4,689 18 4 3 11 6 

C Chnsb 

-- 

medium 2,882 21 1 5 15 7 

El Pasolhiah 

-- 

2.137 39 4 8 27 18 

El Paso-low 3,891 34 9 4 21 16 

.~.~ 

il Paso-medium . . 

- .______ --~- --~-----___. 

3,768 29 4 9 16 9 

-..-- _ ----- 

MC Allen-high 860 27 2 9 16 16 

_... ~- ..~ ___~ 

MC Allen-low 3.463 23 3 7 13 11 

(continued) 

Page 126 GAO/GGD9062 Employer Sanctions 
Appendix Ill 

Technical Appendix 

StratGm Universe Sample 

Hiring elsewhere or 0 Undelivered/out of Adjusted 

employees business sample Response 

MC Al)enmedium 

S Antbnio-high 

S Antbni&ow 

1,286 27 2 8 17 13 ~- 

5,651 59 12 14 33 18 

13,685 59 9 8 42 33 

S Ant’ 

.J 

niomedi m 7537 55 6 8 41 30 

214 29 49 136 84 

266 42 45 179 129 

245 31 39 175 107 

425,270 1,134 159 219 756 505 

Arizona-high 15,546 54 5 5 44 29 

Arizo d a.low 35,567 55 9 11 35 30 

Arq a-medium -. 20,557 59 9 2 48 26 

Colorado-high -. - 9,524 43 5 11 27 19 

do&ado-low ~~~ 42.798 46 6 10 30 22 

Coloradomedium 

New vexicohigh 

New I(nexico.low 

37,998 52 7 9 36 29 

7,559 61 10 12 39 27 

14,934 63 14 16 33 22 

New Mexrcomedium 11.304 50 5 5 40 22 

Hawaii-high 2,280 84 12 16 56 40 

Hawaii-tow 9,567 89 20 17 52 42 

Hawaii-medium 12,558 120 21 28 71 57 

@t&t west-hiah 43.021 73 15 12 46 32 

Rest west-low 243,749 84 8 17 59 38 

Rest westmedium 

Rest of west. 

65,283 59 3 14 42 27 

572,245 992 149 185 658 462 

Rest U.S.-hiah 412.205 470 81 66 323 245 

Rest U.S.-low 2,338,756 536 103 82 351 242 ~_ ~-~ 

Rest U.S.-med 538,540 384 67 59 258 198 

Other states- .-. .--- 3,289,501 1,390 251 207 932 685 

---.- __--___--- 

CA-agn 6,054 789 117 126 546 415 

TX-a&i. ..- 3,278 177 26 35 116 88 

AZ-agn 476 66- 9 19 38 27 

COr&ri, .-. 780 21 8 0 13 7 

(continued) 

Page 126 GAO/GGD-9082 Employer Sanctions 
Appendix III 

Technical Appendix 

/ 

/ 

Univeree Sample 

Hiring elsewhere or 0 Undelivered/out of Adjusted 

employees business sample Response 

. _--.-_--- _.- ~ 

199 36 5 8 23 18 

4,702 96 13 33 50 34 

428 59 10 14 35 33 

Rest U.S.-agri. 51,900 184 56 28- 100 56 ~- 

Agricultural 

employe's 67,817 1,428 244 263 921 680 

U.S. TotpI 5,499,546 9,491 1,456 1,716 6,317 4,362 

The sampled employers returned the questionnaires over a 5-month 

period. We analyzed the data to determine whether trends existed 

according to when the questionnaires were returned. The purpose of 

this analysis was to determine if response time was related to important 

variables in our analysis. If response time was not related to important 

analysis variables, then we could generalize our results to the entire universe of respondents and nonrespondents. The logic of this approach is 

that we could have stopped adding newly received questionnaires to our 

database at any time. Responses received after that time would be 

nonresponses. For example, if we had stopped after 20 batches of data 

had been keypunched, the questionnaires that were later sent in the 21st 

batch would have been “nonrespondents,” If we had found the 

responses in this batch to be similar to previous responses, then it would 

be reasonable to assume that future questionnaires, should they be 

received, would be similar to current questionnaires. 

We performed this analysis at several points in time, comparing the 

questionnaires received before an arbitrary date to those received after 

that date. We compared the groups by geographic region, size of the 

firms as represented by number of employees, percentage of Hispanic 

and Asian employees, and the combined discrimination questions. We 

found no differences among the groups on any of the factors examined. 

Based upon this information, we assumed that our sample of respondents did not differ significantly from the nonrespondents.g Therefore, 

we generalized our findings to the entire universe of employers without 

adjusting for nonresponse. 

However, approximately 15 percent of our original sample was from 

firms that had no employees or did not hire at the location that received 

the questionnaire. We felt that these firms should not be represented in 

our survey results. Therefore, we eliminated them from our sample 

%nce we did not poll nonrespondents, we cannot verify this assumption. 

Page 127 GAO/GGD90-62 Employer Sanctions 
Appendix m 

Teehnieal Appendix 

(along with 23 cases in which the firm may have misunderstood the 

instructions) and adjusted the universe that we can project to only those 

firms with one or more employees who hire at the local level. This universe is approximately 4.66 million employers. 

Sabpling Errors 

I 

All sample surveys are subject to sampling error, i.e., the extent to 

which the results differ from what would be obtained if the whole population had received and returned the questionnaire. The size of the sampling errors depends largely on the number of respondents and the 

amount of variability in the data. For the employer survey, the sample 

sizes were chosen to produce a sampling error of less than 5 percent at 

the 95 percent confidence level. Sampling errors for analyses discussed 

in this report are within the design parameters, except as shown in table 

111.2. 

Table 111.2: Sampling Error Calculations for Questions Where the Error Exceeded 5 Percent 

Paaie ot text Question Estimate Lower bound UpPer bound 

41 

41 

43 

Number of new employees hired by employers who, as 2,200,000 1,600,OOO 2,800,OOO 

result of their understanding of RCA, applied the law’s 

employment verification system only to foreign-looking 

or foreign-sounding persons .__I_--- 

Number of new employees hired dy employers who 4,900,000 3,600,OOO 6,i 00,000 

Number of new employees hired by employers who 

began a practice to not hire persons because of foreign 

aooearance or accent 

1 ,100,000 700,000 1,400,000 

began a practice t6 hire only persons b&n-in the U.S 

or not hire persons with temporary work documents 

Percentage of employers who said their understanding 76 70 82 

of RCA caused them to begin hiring only U.S.-born 

persons and who had no Hispanic employees 

-___~--- -..I-._ __________ 

Percentage of employers in heavily Hispanic areas who 54- 47 61 

said they began to hire only U.S.-born persons as a 

result of their understanding of RCA and who had no 

Hispanic employees 

43 

44 

Nonsampling Errors In addition to sampling errors, surveys can also be subject to other types 

of systematic error or bias that can affect results. This is especially true 

when respondents are asked to respond to questions about an illegal 

activity. Lack of understanding of the issues can also result in systematic error. Bias can affect both response rates and the way in which 

particular questions are answered by respondents. It is not possible to 

assess the magnitude of the effect of biases, if any, on the results of this 

survey. 

Page 128 GAO/GGD-90-62 Employer Sanctions 
Appendix ISI 

Technical Appendix 

When respondents were asked to report their hiring and employment 

practices, it is likely that at least some of those who were not conforming to the law would decide not to respond to the survey so as to 

avoid lying about their behavior or reporting illegal behavior. To the 

extent that this occurs, the proportion of discrimination related to the 

law is underestimated by the survey results. To some unknown extent, 

this group’s failure to respond is affected by those who think they are 

violating the law and do not want to lie or risk revealing “illegal behavior.” A misunderstanding of the law could lead to their failure to 

respond. Of course, survey recipients in general can fail to respond for a 

wide variety of reasons. Bias occurs when one group of respondents-in 

this case, those who are engaging in illegal behavior-respond at different rates than others. 

Some of those who respond to the survey and who are engaging in illegal 

behavior may report that their conduct conforms with the law when in 

fact it does not. This bias also results in an underestimation of illegal 

behavior. 

The effect of bias that could result from a lack of understanding of the 

provisions of the law coupled with the desire to provide the socially 

acceptable response is less clear. Some respondents who want to provide 

the “right” answers may have an incorrect notion of right because they 

misinterpret the law. For example, some respondents may think that the 

law requires that they hire only persons born in the United States, so 

they mark “yes” to the question about this behavior on the questionnaire though they may not make this distinction in actual hiring. This 

type of bias could be in either direction in terms of affecting the incidence of discrimination. Further, misinterpretation could relate to one or 

several aspects of the law. 

In addition, it may be that some respondents untruthfully claimed to 

engage in discriminatory practices. This is possible if they were motivated by a desire to have GAO make a discrimination finding that could 

lead to eventual repeal of employer sanctions. 

Projected Response for 

Selected Figures 

Table III.3 provides the projected employer universes used in the figures 

listed. 

Page 129 GAO/GGD-90432 Employer Sanctions 
Appendix JII 

Technical Appendix 

Tab1 111.3: Employer Univerres for 

Selei ? ted Figures 

i 

Figure number 

3.2 

Column Ertimated number 

Chicago 146,000 

Miami 49,000 

Los Angeles 174,000 

New York City 213,000 

California (excluding Los Angeles) 

Texas 

____- 

386,000 

363.000 

Rest of the west 504,000 

3.3 

Other states 2,677,OOO 

Chicago 146,000 

Miami 49,000 

Los Angeles 174,000 

New York City 213,000 

California (excluding Los Angeles) 386,000 

Texas 363,006 

Rest of the west 504,000 

&her states 2.677.000 

3.4 Chicago 146,000 

Miami 49,000 

Los Angeles 174,000 

New York Citv 213,000 

California (excluding Los Angeles) 386,000 

Texas 363,000 

Rest of the west 504,000 

Other states 2,677.OOO 

3.5 National origin discrimination: 

Industries with high roportions of Hispanics and 

Asians 611.000 

Industries with medium proportions of 

Hispanics and Asians 

Industries with low proportions of Hispanics 

and Asians 

1,108,OOO 

2,794,ooo 

Citizenship discrimination: 

Industries with high proportions of Hispanics 

and Asians 

- 

611,000 

-- 

3.6 

--- 

Industries with medium proportions of 

Hispanics and Asians 

Industries with low proportions of Hispanics 

and Asians 

National oriain: 

1 to 3 employees 

4 to 25 employees 

26 or more employees 

1,108,OOO 

2,794,OOO 

1,486,OOO 

2,099,ooo 

768,000 

(continued) 

Page 130 GAO/GGD-9082 Employer Sanctions 
I Figure number Column 

Citizenshio: 

Estimated number 

1 to 3 employees 1,486,OOO . 

4 to 25 employees 

26 or more emolovees 

2,099,000 

768.000 

3.15 

I I 

Make SSN only work elrgrbrlrty document: 

Discriminators 

Nondiscriminators 

Establish system to contact INS to verify: 

Discriminators 

849,000 

3,329,ooo 

843,000 

Nondiscriminators 

Establish svstem to contact SSA to verifv SSN: 

Discriminators 

3,313,ooo 

845,000 

Nondiscriminators 3,353,ooo 

Hiribg Audit 

Overview of Technique The objective of the hiring audit was to observe employers’ behavior to 

make inferences about whether persons who look and/or sound foreign 

are treated differently when seeking employment compared to individuals who do not look or sound foreign. Pairs of jobseekers were sent into 

the labor market who were matched on a defined set of “job-relevant” 

characteristics but who were different in one aspect of appearance and 

speech. How far the individual jobseekers progressed and what differences occurred in the hiring process were recorded and compared for 

each member of the pair, Statistical analysis then permitted estimation 

of disparate treatment. 

Hiririg Audit Locations I / I 

The hiring audit took place in two cities-San Diego and Chicago. The 

cities were selected because of their size, labor market characteristics, 

demographic composition, and geographic location. Specifically, these 

two cities were selected because they met the following criteria: 

. They were large enough to have sufficient numbers of entry-level jobs to 

meet the required sample size of the study in a few weeks. 

l They each had a large Hispanic population. 

l They had unemployment rates equal to or lower than the national average for the entry-level jobs selected for the audit. 

. They were located in different regions of the country. 

Page 131 GAO/GGD-!I042 Employer Sanctions 
The criteria were developed to ensure a sufficient pool of jobs with a 

relatively low unemployment rate to increase the likelihood of job offers 

for the hiring audit “testers” (individuals recruited to apply for the 

jobs). 

Se1 lection of Testers Sixteen male college students were recruited in Chicago and San Diego to 

be testers, resulting in 8 pairs of testers (4 pairs in each city). Each pair 

consisted of an Anglo and a Hispanic. The testers were matched as 

closely as possible on attributes that would be relevant to employment 

potential such as age, education, work experience, and oral communication skills. An attempt was made to assure that both members of each 

pair would appear to the employer as equally qualified The only dimension that would appear different to the employer would be that one 

member was foreign-looking and/or foreign sounding. 

The Sampling Strategy The sample size was determined by the availability of resources; Urban 

Institute determined that approximately 300 to 360 audits could be completed within the budget constraints and the required time frame. This 

would be accomplished by using four pairs of testers in each of the 

cities. 

To evaluate whether 300 audits would yield sufficient statistical power 

to detect substantively significant levels of discrimination, GAO carried 

out a number of expected precision calculations. We found that under 

the assumptions (1) that matching was moderately effective (i.e., Pearson correlation between binary outcomes of matched pair members=0.5) 

and (2) that clustering of outcomes within matched pairs was small (i.e., 

intracluster correlation coefficient-o), a sample of 300 audits was sufficient to detect, with a probability of at least 0.80, a lo-percentage point 

difference in the employment chances of Anglos and Hispanics. 

The study sampled low-skill, entry-level jobs requiring limited experience. They are the typical jobs that would be filled by a high school 

graduate in the 20- to 24-year age range. Not all jobs at the low-skill 

entry level were appropriate for this study. Numerous jobs were judged 

to be ineligible for sampling because they required credentials such as 

special driver’s licenses, equipment such as a tool chest, were with the 

government, or could only be obtained through an intermediary. 

The principal consideration in drawing the sample of employers and job 

openings was to ensure randomness. Random samples require that the 

Page 132 GAO/GGD-30-62 Employer Sanctions 
Desig ; Implementation p 

Appendix III 

Tech&al Appendix 

universe be defined so that each of the job vacancies in the selected 

occupations had an equal chance of being drawn. This requirement led 

to newspaper want ads as the only job vacancy universe feasible for this 

study. The job advertisements were randomly selected from major newspapers in each of the cities. A number of ads did not lead to audits, 

resulting in a nonresponse rate of about one-third. The main reasons for 

the nonresponse were that the job had already been taken, testers could 

not make contact with the employers, both testers were screened out on 

the phone, or an exclusion was discovered after initial contact. 

Testers alternated the order in which members of the pair applied for 

jobs. There were 302 completed valid audits (job was available and tester made contact with potential employer). There were an additional 19 

audits that were terminated prematurely because of special circumstances. For example, if an employer required that a test be taken, the 

audit was terminated because we would be unable to assure that both 

testers scored similarly. In addition, 39 audits were truncated because 

they had started in the last 2 weeks of the study, and the employer did 

not make a job offer decision for at least one tester. For terminated and 

truncated audits, data to the decision point of termination (e.g., whether 

unfavorable treatment at application or interview stage) were used. 

Analysis and Statistical 

Significance 

The analysis in this study is based on how pairs of testers proceed on a 

comparative basis through the hiring process. We define the hiring process as a progression through three stages: (1) application, (2) interview, 

and (3) job offer. Unfavorable treatment occurred where there was differential progress between the two members of a pair during the hiring 

process. 

As noted earlier, the precision of these estimates depends on the levels 

of unfavorable treatment and the size of the intracluster correlation 

coefficient in the sample. The higher the intracluster correlation coefficient, other things equal, the higher the variance and the lower the precision of the estimated Anglo-Hispanic difference in treatment. The 

variance of the estimated difference in treatment was calculated for 

each of the outcomes. We estimated RHO, the intraclass correlation coefficient, using the estimator as follows: 

Provided that cluster sizes are roughly equal, then the standard error of 

the paired Anglo-Hispanic difference under two-stage cluster sampling, 

say SE CL, can be estimated using 

Page 133 GAO/GGD9082 Employer Sanctions 
- 

- 

Appendix LU 

Technical Appendix 

SE Cl. = SE s,(s d/1 + RHO (M - 1) 

where M is the mean cluster size and SE SRS is the standard error of the 

paired difference under simple random sampling. 

These standard errors assume that the outcomes obtained by the two 

members of each matched pair from each employer were independent of 

each other. This would not be true if, for example, the employer decided 

to hire one member and not the other only because he could not afford 

to hire or needed only one new employee. To mitigate this potential bias, 

testers were instructed to turn down job offers as soon as possible. However, the possibility of some dependence between some tester outcomes 

remains (e.g., due to employers’ limited time for interviewing or to competition between testers). 

The intracluster correlation coefficients were small for each of the outcomes, possibly due to successful matching and the narrow range of 

testers employed (i.e., males between 19 and 24 years old). Alternatively, the small magnitudes might be due to violations of the independence assumption. 

Tests of the statistical significance of differences in treatment were done 

for each of the outcome variables using the standard matched pair ttest. This test was adjusted for cluster sampling using the method of 

Kish.” 

Design Limitations In the hiring audit, we seek to make inferences about a particular kind 

of discrimination, namely discrimination in the employment of unskilled 

workers. The incidence of discrimination in the employment process 

depends upon many factors, including the characteristics of employers, 

the characteristics of prospective employees, and many aspects of the 

contexts or situations in which applications for employment, interviews, 

and hiring take place. Unfortunately, discrimination cannot be measured 

directly. On the contrary, discrimination is measured as a residual after 

other “extraneous” factors thought to affect the behavioral outcome 

(e.g., unfavorable treatment) have been controlled. 

The validity of any inference of discrimination depends upon (1) knowing all of the important extraneous variables that affect the outcome 

4Leslie Kish, Survey Sampling (New York: John Wiley, 1965). 

Page 134 GAO/GGD-9082 Employer Sanctions 
Appendix IIf 

Technical Appendix 

and (2) measuring and correctly incorporating in the matching procedure all the important variables that affect the outcome. Because discrimination is always measured as a residual after other determinants of 

employment outcomes have been controlled, failure to identify, measure, and/or incorporate all determinants of employment outcomes 

results in biased estimation of the effect of discrimination. Although we 

have attempted to control job-relevant variables through matching, 

there may be variables that we did not match that would have affected 

the hiring outcome. Thus, if we did not match on all important variables, 

our estimates may be biased because of omitted variables. 

As noted earlier, we determined that newspaper want ads were the only 

job vacancy universe feasible for this study. However, we realize that 

most jobs are obtained through personal contacts, direct application, 

and intermediaries such as employment services. Thus, there may be 

some bias in relation to generalizing to all similar jobs due to the exclusion of these other potential job vacancy sources. Research suggests that 

employers who advertise in the newspaper tend to discriminate less 

than those who hire through personal contact or direct application5 

Thus, a newspaper want ad sampling frame provides at least the lower 

limits of unfavorable treatment if it exists. 

Fine Analysis To determine if the INS field offices were satisfactorily implementing the 

INS Commissioner’s policies and procedures to enforce the law, we 

reviewed a random sample of INS case files of employers who had been 

fined (sanctioned) for violating the law. We selected a random sample of 

300 cases from the total universe of 704 case files that were closed during the period July 1, 1988, to February 28, 1989. The sampling errors 

for estimates reported in the text are presented in table 111.4. 

‘Harry Holzer, “Informal Job Search and Black Youth Unemployment,” The American Economic 

Review (June 1987);Harry Holzer, “Utilization of Public and Private Job Search Mechanisms: The 

Experiences of Employers and Employees,” U.S. Department of Labor, Secretary’s Commission on 

Workforce Quality and Labor Market Efficiency, Washington, DC., 1987; and Katherine G. Abraham, 

“Help Wanted Advertising, Job Vacancies, and Unemployment,” Brookmgs Papers on Economic 

Activity, Vol. 1 (Washington, DC.). 1987. 

Page 135 GAO/GGD9062 Employer Sanctions 
Appendix Ill 

Technical Appendix 

Table 111.4: Estimates, Sempllng Errorr, 

and:95 Percent Confidence Llmltr for the 

Emqloyers’ Fine Analyblb 

95 perce,nntnfldence 

Description Estimate Lower Upper 

-- I Policy for Sanctioning Employers: 

~ 

- -- 

19 11 30 I Fines that may not be consistent with INS policy (3%) (2%) (4%) 

603 672 694 

Fines consistent with INS policy: (97%) (96%) (99%: 

Fined for knowingly hiring or continuing to employ 

unauthorized workers 354 322 386 

- Employers educated but found with subsequent violations 

-- 

73 53 93 

Employers fined for paperwork violations and found with 

unauthorized workers 256 231 281 

______ 

Missing documentation in the case files: 

Reason for reducing the initial fine assessed 

-- 

378 346 410 

Whether INS educated the employer on the law’s 

requirements 

Application for notice of intent to fine 

Employer agreement to participate in INS’ authorized 

worker program 

Whether the fine was collected 

The reason thene was not collected 

The final order or settlement aareement 

168 160 216 

383 351 415 

‘38 --____ 

113 163 

a4 63 105 

26 18 36 

---... 

26 17 38 

Cases where INS reduced the initial fine amount 

INS did not document the reason(s) for the reduction 

415 384 446 

(59%) (55%) (63%; 

37--- 362 392 

(91%) (87%) (94%; 

Page 136 GAO/GGD90-62 Employer Sanctions 
Appendix IV 

L&al Analysis of the Comptroller General’s 

De$erminations Under the IRCA 

Tebnination Provisions 

The Immigration Reform and Control Act of 1986’ calls upon the Comptroller General to make determinations that, depending on their outcome, could trigger expedited congressional procedures leading to the 

termination of certain provisions of IRCA. Specifically, the employer verification and sanctions section of IRCA could be terminated if the Comptroller General determines that “a widespread pattern of discrimination 

has resulted against” eligible workers “solely from the implementation 

of this section.” Also, the antidiscrimination section of IRCA could be terminated if the Comptroller General determines either that “no significant discrimination” has resulted from implementation of the employer 

verification and sanctions section or that the antidiscrimination section 

“has created an unreasonable burden on employers.” This analysis presents GAO’S legal interpretation of the scope of these determinations and 

the criteria that apply to them. 

I 

Stat$tory Background 

Employer Verification and 

Sanctions Section 

Section 274A of the Immigration and Nationality Act, as added by IRCA, 

8 U.S.C. !j 1324a (Supp. IV 1986)-the so-called employer verification 

and sanctions section of WA-makes it unlawful “to hire, or to recruit 

or refer for a fee, for employment in the United States” any individual 

without complying with the verification system established by that section. It also prohibits the hiring, recruitment, or referral for a fee of an 

unauthorized alien while knowing the alien to be unauthorized; however, good faith compliance with the verification system is made a 

defense to such a violation. Finally, it is made unlawful to knowingly 

“continue to employ” an unauthorized alien, See section 274A(s)(l)-(3). 

Section 274A goes on to prescribe documentation and employer verification requirements, penalties for their violation, and enforcement responsibilities to be exercised by the Attorney General. 

Section 274AGj)( 1) requires the Comptroller General to issue a series of 

three annual reports, beginning 1 year after enactment of IRCIA, which 

are to describe the results of GAO reviews of the implementation and 

enforcement of the provisions of section 274A during the preceding year 

for the purpose of determining if: 

‘Pub. L. No. 99-603, approved November 6,1986,100 Stat. 3369. The Immigration Technical Corrections Act of 1988, Pub. L. No. 100-625, approved October 24,1988,102 Stat. 2609, made minor wording changes in several provisions of IRCA. These changes have been incorporated in the provisions as 

discussed in this analysis. 

Page 137 GAO/GGD-SOS2 Employer Sanctions 
AppendSx IV 

Legal Analyeia of the Comptroller General’s 

Determlnationa Under the ECA 

Termination Provisions 

“(A) such provisions have been carried out satisfactorily; 

“(B) a pattern of discrimination has resulted against citizens or nationals of the 

United States or against eligible workers seeking employment; and 

“(CT) an unnecessary regulatory burden has been created for employers hiring such 

workers.” 

The Comptroller General is required to include in each annual report “a 

specific determination as to whether the implementation of that section 

has resulted in a pattern of discrimination in employment (against other 

than unauthorized aliens) on the basis of national origin.” See section 

274A(j)(2). If the Comptroller General determines that such a pattern of 

discrimination has resulted, the report shall describe the scope of that 

determination and may include legislative recommendations to deter or 

remedy such discrimination. See section 274ACj)(3). 

Section 274A(k) requires the Attorney General, acting jointly with the 

Chairman of the Civil Rights Commission and the Chairman of the Equal 

Employment Opportunity Commission, to establish a task force to 

review each annual Comptroller General report. If the report includes a 

determination by the Comptroller General that a pattern of discrimination exists, the task force is to report to Congress its recommendations 

for such legislation as may be appropriate to deter or remedy the discrimination Congressional hearings on the report are to be held on an 

expedited basis. 

Section 274A(l)( 1) provides for termination of the employer verification 

and sanctionssection 30 days after receipt of the last annual Comptroller General report under section 274ACj) if: 

“(A) the Comptroller General determines, and so reports in such report, that a widespread pattern of discrimination has resulted against citizens or nationals of the 

United States or against eligible workers seeking employment solely from the implementation of this section; and 

“(B) there is enacted, within such period of 30 calendar days, a joint resolution stating in substance that Congress approves the findings of the Comptroller General 

contained in such report.” 

Antidiscrimication Section Section 274B of the Immigration and Nationality Act, as added by IRCA, 8 

U.S.C. § 1324b-the so-called antidiscrimination section of IRCA-provides in subsection (a)( 1): 

Page 138 GAO/GGlXJO42 Employer Sanctions 
Appendix TV 

Legal Analysis of the Comptroller General’s 

Determinations Under the IRMA 

Termination Provisions 

“( 1) GENERAL RULE.-It is an unfair immigration-related employment practice for 

a person or other entity to discriminate against any individual (other than an unauthorized alien) with respect to the hiring, or recruitment or referral for a fee, of the 

individual for employment or the discharging of the individual from employment- 

“(A) because of such individual’s national origin, or 

“(B) in the case of a citizen or intending citizen. , . because of such individual’s 

citizenship status.“” 

Section 274B goes on to establish processes for investigating and resolving unfair immigration-related employment practice complaints. Among 

other things, it requires the appointment within the Department of Justice of a Special Counsel to investigate and prosecute such complaints. 

Section 274B(k)( 1) provides for the termination of the antidiscrimination section of IRCA if the employer verification and sanctions section is 

terminated as a result of the Comptroller General’s determination and 

congressional action endorsing it pursuant to section 274A(L), described 

previously. Section 274B(k)(2) describes two additional avenues for termination of the antidiscrimination section as follows: 

“(2) The provisions of this section shall terminate 30 calendar days after receipt of 

the last report required to be transmitted under section 274A(j) if- 

“(A) the Comptroller General determines, and so reports in such report that- 

“(i) no significant discrimination has resulted against citizens or nationals of the 

United States or against any eligible workers seeking employment, from the implementation of section 274A, or 

“(ii) such section has created an unreasonable burden on employers hiring such 

workers; and 

“(B) there has been enacted, within such period of 30 calendar days, a joint resolution stating in substance that Congress approves the findings of the Comptroller 

General contained in such report.” 

“Section 274B makes certain exceptions to the general prohibition against discrimination based on 

citizenship status, section 274B(a)(2)(C), and also permits an employer to prefer a U.S. citizen or 

national over an alien if the two are equally qualified, section 274B(a)(4). 

Page 139 GAO/GGD90-62 Employer Sanctions 
- 

- 

Appendix IV 

Legal Analysie of the Comptroller General’s 

Determination@ Under the IRCA 

Termination Provisions 

- . 

In summary, the last of the Comptroller General’s three annual reports 

will initiate a process that could lead to termination of the employer verification and sanctions section of IRCA if the Comptroller General determines “that a widespread pattern of discrimination has resulted against 

citizens or nationals of the United States or against eligible workers 

seeking employment solely from the implementation of this section. , . .” 

See section 274A(l)(i)(A). If the employer verification and sanctions 

section terminates as a result of such a determination, the antidiscrimination section will cease to apply as well. Section 274B(k)(l). Even 

if the employer verification and sanctions section does not terminate, 

the antidiscrimination section may terminate if the Comptroller General 

determines in his third report either that “no significant discrimination” 

against eligible workers seeking employment has resulted from implementation of the employer verification and sanctions section or that the 

antidiscrimination section “has created an unreasonable burden on 

employers hiring such workers. . . .” See section 274B(k)(2)(A)(i) and 

(ii). 

Widespread Pattern of 

Discrimination 

Determination 

Scope of Covered 

Discrimination 

In describing the Comptroller General’s determination as to discrimination resulting from employer verification and sanctions, section 

274A(l)(i)(A) refers to “discrimination” that “has resulted against citizens or nationals of the United States or against eligible workers seeking 

employment. . . .” It is abundantly clear from this language, other provisions of section 274A and 274B, and the entire context of the statute 

that the Comptroller General’s determination focuses on discrimination 

in employment. There is no indication that the Comptroller General’s 

determination was intended to look beyond employment discrimination 

into such areas as discrimination in housing or public accommodations. 

The extent of covered employment discrimination also can be ascertained by reading the statute as a whole. Both the employer verification 

and sanctions provision in section 274A(a) and the antidiscrimination 

provisions in section 274B(a) apply to hiring, recruitment, referral, and 

discharging (or, in the case of the sanctions, continuing to employ). The 

Page 140 GAO/GGlMO82 Employer Sanctions 
Appendix Iv 

Legal Analysis of the Comptroller General’s 

Determinations Under the JRCA 

Termination Provisions 

legislative history likewise describes discrimination with exclusive reference to these aspects of employment, with particular emphasis on discrimination in hiring. Given these considerations, we conclude that the 

Comptroller General’s determination embraces only discrimination 

related to the hiring, recruitment, referral or discharging of employees. 

It does not include discrimination involving conditions of employment 

such as wages or promotions. 

While the language of the Comptroller General determination provision 

in section 2741\(1)(l)(A) does not specify what basis or bases of discrimination it covers: discrimination on the basis of national origin clearly is 

included. Two of the other provisions of section 274A dealing specifically with the Comptroller General’s determinations refer expressly to 

“a pattern of discrimination in employment (against other than unauthorized aliens) on the basis of national origin. . . .” See sections 

274Adj)(2) and (k)(2). The conference report on IRCA also observes that 

the three annual GAO reports are to address “whether a pattern of 

employment discrimination based on national origins has resulted from 

employer sanctions.“:{ Likewise, the legislative history is replete with 

expressions of concern that employer sanctions might result in discrimination against “foreign-appearing” persons,” particularly Hispanics, 

Asians, and other minority groups.” These concerns fit squarely within 

the EEOC Guidelines on Discrimination Because of National Origin, for 

purposes of title VII of the Civil Rights Act, as follows: 

“The Commission defines national origin discrimination broadly as including, but 

not limited to, the denial of equal employment opportunity because of an individual’s, or his or her ancestor’s, place of origin; or because an individual has the physical, cultural or linguistic characteristics of a national origin group. . . .“(i 

Thus, national origin discrimination, as so defined, clearly is covered by 

the Comptroller General’s determination. 

“H.R. Rep. No. 99-1000,99th Cong., 2d Sess. at 86 (1986). 

41& at 87. 

“See, e.g., 131 Cong. Rec. 23320 and 23717 (1985) (remarks of Senator Kennedy); &J. at 23718-19 

(remarks of Senator Symms); id. at 23720 (remarks of Senator Dixon). 

“29 C.F.R. 8 1606.1 (1988). 

Page 141 GAO/GGD-9082 Employer Sanctions 
Appendix IV 

Legal Analysis of the Comptroller General’s 

LJeterminations Under the IRCA 

Termination Provisions 

Dijparate Treatment 

Vetsus Disparate Impact 

The executive branch takes the position that the antidiscrimination section of IRCA (section 274B) applies only to “disparate treatment,” i.e., 

intentional discrimination, and does not extend to “disparate impact” or 

“adverse impact” discrimination, i.e., actions that may-be facially nondiscriminatory but have an unintended discriminatory effect on a protected class7 Whatever the merits of this position with respect to the 

antidiscrimination section, there is no basis to draw a distinction 

between disparate treatment and disparate impact discrimination for 

purposes of the Comptroller General’s determinations under section 

274A. As noted previously, the Comptroller General determination provisions were enacted in response to concerns that employer sanctions 

might result in discrimination against foreign-appearing persons. We 

have found no evidence to suggest that these generalized concerns 

turned on the precise form of such discrimination so long as it resulted 

from implementation of the employer verification and sanctions system. 

Further, we note that the EEOC Guidelines explicitly cover both disparate 

treatment and disparate impact.” It would be anomalous to conclude that 

the Comptroller General’s determination does not cover national origin 

discrimination actionable under title VII. 

“A i ienage” Discrimination While the Comptroller General’s determination clearly addresses 

national origin discrimination, a more difficult issue is whether it 

extends to discrimination based on citizenship status, i.e., alienage discrimination. The Supreme Court has recognized a distinction between 

discrimination based on national origin and discrimination based on 

“alienage” or citizenship status. See Espinoza v. Farah Mfg. Co., 414 U.S. 

86 (1973). This distinction is recognized as well in the antidiscrimination 

section of IRCA. The caption of section 274B refers to “Discrimination 

Based on National Origin or Citizenship Status” (emphasis supplied) and 

the substantive prohibitions in section 274B(a)( 1) treat national origin 

and citizenship status as separate categories of prohibited 

discrimination. 

By contrast, none of the four provisions in section 274A dealing with the 

Comptroller General’s reviews and determinations mentions alienage 

discrimination. Two of these provisions-sections 274A(j)( 2) and 

(k)(2))-refer only to discrimination “on the basis of national origin” 

7See, e.g., the President’s statement on signing IRCA into law, 1986 U.S. Code Gong. & Admin. News 

5866-l; preamble to final Justice Department rules on Unfair Immigration-Related Employment Practices, 62 Fed. Reg. 37402-06 (Oct. 6, 1987). 

“See 29 C.F.R. 81606.2 (1988). 

Page 142 GAO/GGD-9062 Employer Sanctions 
Appendix lV 

Legal Analysis of the Comptroller General’s 

Determinations Under the IRCA 

Termination Provisions 

while the other two, including the provision dealing specifically with the 

third-year determination which could trigger expedited congressional 

repeal of employer sanctions, simply refer to discrimination against “citizens or nationals of the United States or against eligible workers seeking employment. . . .” See sections 274A (j)(l)(B) and (l)(l)(A). It could 

be argued that the more general language of the latter two provisions is 

broad enough to include alienage as well as national origin discrimination. In this vein, one could view the absence of a reference to national 

origin discrimination in these two provisions as suggesting that Congress 

intended them to cover more than national origin discrimination. Also, it 

might appear incongruous to exclude from the Comptroller General’s 

determination under section 274A a form of discrimination which is proscribed under section 274B of the same statute, particularly when the 

proscriptions against alienage discrimination stem from the same concern as the Comptroller General determination provisions-the potential effects of employer sanctions. 

While these are substantial arguments, we conclude that the weight of 

the evidence of congressional intent is against including alienage discrimination within the Comptroller General’s determination. First, we 

have found no indication that the four references in section 274A to the 

Comptroller General’s determinations concerning discrimination were 

intended to have different meanings. Thus, we are inclined to believe 

that the references to national origin discrimination in the more specific 

provisions were meant to apply as well to the more general provisions. 

The conference report tends to support this interpretation since it 

describes the Comptroller General’s determinations only in terms of 

national origin discrimination.!’ Second, as noted in the conference 

report,]” the Comptroller General review and determination provisions 

of section 274A came from the Senate version of the bill. The Senatepassed bill did not include an antidiscrimination section. In fact, an 

amendment by Senator Hart very similar to the antidiscrimination provisions ultimately enacted as section 274B, including the restrictions 

against alienage discrimination, was debated during Senate consideration of the bill and eventually withdrawn.” Thus, alienage discrimination was not part of the Senate bill when the Comptroller General 

determination provisions were formulated. In this regard, Senator Simpson, a principal sponsor of the bill, specifically eschewed an intent to 

“1I.R. Rep. No. 99-1000, supra note 3, at 86. 

“‘Id. - 

“See 131 Chg. Rec. 23726-35 (1986). 

Page 143 GAO/GGD-9082 Employer Sanctions 
Legal Analysie of the Comptroller GeneraYe 

Determinationa Under the IRCA 

Termination Provisions 

- 

include alienage discrimination within the scope of the Comptroller General’s determination: 

“Again, we are not talking about discrimination based on alienage. That will be visited at a later part of the day. . . .“I’ 

As noted above, an amendment to proscribe alienage discrimination was 

later considered by the Senate but was not adopted. 

In short, it is reasonably clear that the Comptroller General determination provisions as passed by the Senate were not intended to include 

alienage discrimination. There was no change from the Senate language 

when these provisions were adopted in conference, nor is there any indication that the conferees intended any change in the interpretation of 

these provisions. On the contrary, as noted previously, the conferees 

described the Comptroller General’s determinations only in terms of 

national origin discrimination. 

While citizenship discrimination per se is not within the scope of the 

Comptroller General’s determination, discriminatory policies or practices based on a person’s citizenship status are covered to the extent 

that they also constitute national origin discrimination. The overlap 

between these two forms of discrimination is recognized in the EEOC 

Guidelines: 

“In those circumstances, where citizenship requirements have the purpose or effect 

of discriminating against an individual on the basis of national origin, they are prohibited by Title VII.“‘:i 

Indeed, during hearings held on the antidiscrimination provisions of the 

House version of 1~~4,‘~ there was a general consensus among the witnesses that alienage discrimination and national origin discrimination 

are subject to considerable overlap. The hearing record included 

excerpts from EEOC’S compliance manual which illustrated how citizenship requirements could be equated with national origin discrimination 

‘“Id. at 23718. 

- 

“‘29 C.F.R. !j 1606.5(aX1988). 

14Jolnt Hearing before the Subcommittee on Immigration, Refugees, and International Law of the 

House Judiciary Committee (Serial No. 36) and the Subcommittee on Immigration and Refugee Policy 

of the Senate Judiciary Committee (Serial No.QQ-104), 99th Cong., 1st Sess., on Antidiscrimination 

Provision of H.R. 3080 (Oct. 9,1986). 

Page 144 GAO/GGD-9082 Employer Sanctions 
Appendix IV 

LegaJ Analyeia of the Comptroller General’6 

Determinatlona Under the IRCA 

Termination Provieions 

on both disparate treatment and disparate impact theories15 Finally, 

national origin discrimination cannot be mitigated on the basis of a 

claimed relationship to citizenship requirements. For example, an 

employer who claims to hire only citizens but rejects foreign- appearing 

applicants on the assumption that they are not citizens clearly is 

engaged in national origin discrimination. 

Discr mination Resulting 

“Sole y From the 

Imp1 

1 

mentation Of” the 

Empl yer Verification and 

Sanctjions Section 

This element of the Comptroller General determination is designed to 

identify and isolate discrimination in employment that would not have 

occurred without IRC4. In this regard, the legislative history contains a 

number of references to “new” or “increased” discrimination.L” The only 

definitive means of satisfying this element of the determination would 

be to obtain direct evidence from employers that discriminatory actions 

were, in fact, motivated by the employer verification and sanctions provision In a more realistic vein, however, we believe that this element 

can be satisfied by relating covered employment discrimination to areas 

that are unique to IRCA. For example, INS created its Employment Eligibility Verification Form (1-9) for the sole purpose of implementing the 

employer verification and sanctions section of IRCA. Consequently, we 

believe that any discrimination arising from use of the 1-9 form can be 

said to arise “solely from the implementation of” the employer verification and sanctions section. One instance of this would be so-called “documents discrimination,” where the documentation and verification 

requirements of the 1-9 form are applied only to foreign appearing persons or are applied in a more onerous manner to such persons, regardless of whether these persons ultimately are hired. 

“Widespread Pattern of 

Discrimination” 

There is no guidance in the statutory language concerning this element 

of the Comptroller General’s determination. The only references we 

have found to it in the legislative history are Senator Kennedy’s observations that it requires “a serious pattern of discrimination”‘7 and more 

than “just a few isolated cases of discrimination. . . .“I8 While there is no 

indication that such discrimination must be pervasive, there is likewise 

no indication of how serious it must be or how many more than a few 

“Id. at 47-56. - 

‘“See 131 Gong. Rec. 23717-l&23720 (1985) (remarks of Senators Kennedy, Simpson, and Dixon). 

171d at 23321. -..i 

‘“Id at 23717. -2 

Page 145 GAO/GGD90-02 Employer Sanctions 
Appendix N 

Legal Analysis of the Comptroller General’s 

Determinationa Under the IRCA 

Termination Provisiona 

isolated cases. We believe that the “widespread pattern of discrimination” element may appropriately consider a variety of quantitative 

measures. These measures include the number of employers engaged in 

discriminatory practices, the number of employees or applicants potentially affected, the percentages of employers and of the workforce 

involved, and the distribution of discriminatory practices by industry 

type and geographic region. 

Daterminations 

Rebating to the 

Arkidiscrimination 

Prjwisions 

As discussed previously, section 274B(k) of IRCA provides for the possible termination of the antidiscrimination section if the Comptroller General determines either that “no significant discrimination” has resulted 

from implementation of the employer verification and sanctions section 

or that the antidiscrimination section “has created an unreasonable burden on employers. . . .” The conference report on IRCA contains the following explanation of these determinations: 

“The antidiscrimination provisions would also be repealed in the event of a joint 

resolution approving a GAO finding that the sanctions had resulted in no significant 

discrimination, or that the administration of the antidiscrimination provisions had 

resulted in an unreasonable burden on employers. In this regard, the Confer[ees] 

also expect that GAO would specifically look into the issue of whether the antidiscrimination mechanism and remedies are being utilized in a manner that is inconsistent with their original purpose (Le., to guard against employment discrimination 

based on national origins or citizenship status). [The] Conferees wish to emphasize 

that the antidiscrimination provision has been included in order to respond to the 

fears and concerns expressed by many that sanctions will result in employment discrimination based on national origins or citizenship status. Thus, the anti-discrimination provision does not in itself in any way set a precedent for the expansion of 

other Title VII protections.“‘!’ 

During House consideration of the conference report, Representative 

Rodino elaborated upon the antidiscrimination section (referred to as 

the “Frank amendment”) and the Comptroller General’s determinations 

about it: 

“All conferees clearly agreed that we do not intend this provision to act as a precedent for future efforts to broaden civil rights coverage generally for classes now 

protected under title VII, nor is it the intent of this Congress that this language be 

abused by some who would hope to establish, through its administrative procedures, a particularized agenda. In fact, in the statute, we have specifically said that 

such exploits might jeopardize the entire Frank mechanism. 

“‘H.R. Rep. 99-1000 supra, note 3, at 87-88. 

Page 146 GAO/GGD-9082 Employer Sanctions 
Appendix N 

Legal Analysis of the Comptroller General’s 

Determinationa Under the IRCA 

Tecmlnation Provisions 

“We clearly do not expect to see harassment suits initiated under this language, nor 

efforts to extort jobs from small employers through the threat of administrative 

action, In this regard, we incorporated into the attorneys’ fees provisions of the 

Frank amendment limitations on recovery. We agreed that attorneys’ fees should 

not be awarded unless the losing party’s argument ‘is without reasonable foundation 

in fact or law.’ This language is intended to frustrate frivolous suits by taking away 

the incentive to bring them. 

“Further, it should be clear that the possible sunset of Frank is tied to the absence 

of ‘significant discrimination’ resulting from sanctions. Such a sunset is intended to 

parallel the expedited sunset contained in the original Kennedy language in the Senate bill. We failed to include this language in our haste to draft the finished product, 

and that is the reason for this amendment. With the adoption of this amendment, 

then, both Frank and sanctions will be eligible for sunset by an expedited process 

which guarantees floor consideration following an appropriate finding by the Comptroller General.““” 

Senator Simpson offered similar comments during Senate consideration 

of the conference report: 

“The antidiscrimination provisions would . . . be repealed in the event of a joint 

resolution approving a GAO finding that the sanctions have resulted in no significant discrimination or that the administration of the antidiscrimination provisions 

has resulted in placing an unreasonable burden on employers. 

“With this provision we sought to make vividly clear that harassment litigation will 

not be tolerated. And there are some activist groups in the United States who I think 

have been off in the wings kind of slavering at the chops, waiting for their opportunity to go find a whole new crew of plaintiffs to begin a whole new exercise against 

employers in their national efforts. This is wholly discouraged. It will be the subject 

of the most careful oversight by myself, and by Congressman Rodino. 

“In this regard the conferees also expect that GAO would specifically inquire into 

the issue of whether antidiscrimination mechanisms and remedies are being utilized 

in a manner that is inconsistent with their original purpose, which is of course to 

guard against employment discrimination based on national origin or citizenship 

status. 

“The conferees wish to strongly emphasize that the antidiscrimination provision 

has been included solely in order to respond to the fears and concerns expressed by 

some that employer sanctions will result in employment discrimination based on 

national origin or citizenship status. Thus, this is all so very important. 

“‘132 Cong. Rec. H11148 (daily ed., Oct. 16, 1986). 

Page 147 GAO/GGD90-62 Employer Sanctions 

“‘, ,.,/ ’ 
Appendix IV 

Legal Analyeia of the Comptroller General’s 

Determinations Under the I&CA 

Tent&nation Provisions 

“This is a very narrow provision intended to address only employer sanctions, and 

not to provide this avenue for activist groups and organizations to harass employers 

with nuisance suits. We specifically address this possibility in the conference report 

by providing the sunset provision which would be triggered if the Frank amendment 

were to create an ‘unreasonable burden on employers.’ I want the Senate to hear 

that and to be very clear on that point.“21 

Based on the above explanations, section 274B(k)(Z) fundamentally 

calls for a determination of whether the antidiscrimination section is 

serving a useful purpose, as intended, in addressing employment discrimination or, on the other hand, whether it is merely a vehicle for 

harassing employers. 

Sqknmary of 

Cdnclusions 

The following is a summary of our conclusions based on the foregoing 

analysis: 

1. The Comptroller General’s determination under section 274A(l)( 1 )(A) 

as to whether “a widespread pattern of discrimination has resulted 

against citizens or nationals of the United States or against eligible 

workers seeking employment solely from the implementation of this section” focuses on discrimination in the hiring, recruitment, or referral for 

a fee, and discharging of employees or job applicants. It does not include 

discrimination in areas other than employment, nor does it include discrimination in terms or conditions of employment unrelated to hiring, 

discharging, recruitment, or referral. 

2. The section 2741\(1)(l)(A) determination covers national origin discrimination in the form of both disparate treatment and disparate 

impact. 

3. It does not extend to “alienage” discrimination per se, but does 

include such discrimination if it has the purpose or effect of discriminating on the basis of national origin. 

4. Section 274A(l)(i)(A) covers only “new” discrimination that results 

“solely” from implementation of section 274A. This element can be satisfied by evidence that discrimination was in fact motivated by the 

employer sanctions section or by evidence of discrimination relating to 

“Id. at S16614-16. 

- 

Page 148 GAO/GGD-9082 Employer Sanctions 
Appendix IV 

Legal Analysis of the Comptroller General’s 

Determinations Under the JRCA 

Termination Provision 

actions that are unique to section 274A such as implementation of its 

documentation and verification requirements (e.g., use of the I-9 form). 

6. Whether a “widespread pattern of discrimination” exists for purposes 

of section 274A(l)(i)(A) depends upon if there is a “serious pattern” 

and more than “just a few isolated cases of discrimination.” This element will take into account quantitative measures for which no precise 

formula can be applied. 

6. The Comptroller General’s determinations under section 274B(k)(2) 

as to if “no significant discrimination” has resulted from implementation of section 274A or if the antidiscrimination provisions of section 

274B have “created an unreasonable burden on employers” turn on 

whether a significant number of frivolous complaints have been filed. 

Co$ments on Draft 

Leg& Analysis 

We sent our draft legal analysis for comment to 40 individuals and organizations, including House and Senate staff members, public interest 

groups, and government entities. About half of the recipients commented. We heard from all the government entities and one congressional staff member-the Chief Counsel, Senate Subcommittee on 

Immigration and Refugees Affairs. 

The commenters generally agreed with most aspects of the analysis. 

However, all but one of the commenters disagreed with our conclusion 

that only national origin discrimination, as opposed to “alienage” discrimination, is covered by the Comptroller General’s determination 

under section 274A (e)(l)(A). As noted previously, we recognize that this 

is a close question. It also is a moot point, since our determination that a 

widespread pattern exists is based on consideration of national origin 

discrimination alone. At the same time, our report includes our findings 

concerning IRCA-related citizenship discrimination in order that Congress 

may make its own judgment about the significance of this 

discrimination. 

The organizations and individuals that disagree with our position that 

the Comptroller General’s determination does not extend to citizenship 

discrimination are: INS; EEOC; OSC; American Civil Liberties Union; 

National Council of LaRaza; Center for Immigrant Rights, Inc.; City of 

New York Commission on Human Rights; American Federation of Labor 

- Congress of Industrial Organizations; Illinois Commission on Human 

Rights; Washington Lawyers’ Committee for Civil Right; International 

Ladies Garment Workers Union; Association of the Bar of the City of 

Page 149 GAO/GGD-99-62 Employer Sanctions 
&al Analysis of the Comptroller General’s 

Determinationa Under the IRCA 

Termination Provisions 

New York; American Immigration Lawyers Association; New York State 

Department of Social Sciences; San Francisco Lawyers Committee for 

Urban Affairs; American Jewish Committee; U.S. Commission on Civil 

Rights; Professor Marta Tienda, University of Chicago; and MALDEF. 

Page 160 GAO/GGD90432 Employer Sanctions 
Appeddix V 

Su/rvey of Job Applicants 

U.S. GENERAL ACCOUNTING OFFICE 

SIJRVCY OF JOB APPLICANTS 

I. Hew you spplied for B job in person since 

hwary I. i9a9? Rtitm ONE.) 

kmForehmfaeiq, 

2. The bet time you applied for B job, did you 

discuss with the employer either your eligibility 

to work or wrk rruthorirution documel>ts? (CHECK 

ALL THAl APPLY.) 

150 150 1. 300 yes (CONTINUE ro QIJESTION 2.) NmForeiqn foreign 

0 0 2. 0 NO 

(SKIP 10 81 Isa 1. 219 Yea, eligibility tu work 

0 0 3. 0 oon’t remenber P PAGE 5, 

QUESIION 19.) 112 35 2. 147 Yes, nurk aulhuriretian 

documents 

IF150 n=lM NGoo 

0 0 5. 0 No, 1 didn’t discuss either 

(SKIP IO PAGE 5, OIJESIION 19.) 

II=193 ICI73 Nm366 

REHEMBER -- ANSWER IHE FOLLOWING QUESIIONS 

BASE0 ONLY UPON THC LAST TlHE YOU APPLIEO FOR 

YOUR ANSWLRS ARE ANONYMOUS. 

Note : A Sl,nnish translation of this survev was also available. 

Page 161 GAO/GGMO432 Employer Sanctions 
Appendix V 

Snrvey of Job Applhnta 

Y 

3. In which of the fallowing types of orqenlzations 

WEB the job YOU WBPB seeking? (CHECK ONE.) 

2 16 1. 16 Communicetions and utilities 

11 12 2. 23 

1 2 3. 3 

7.0 4. 23 

Fermlng (Agriculture) 

3 Fmsnce, insurance, or 

real estate 

15 2 5. 17 

1 6. 1 

4 7. 12 

1 0. 2 

2 9. 5 

0 10. 0 

5 11. 5a 

7 12. 12 

B 13. 10 

7 14. 11 

5 15. 8 

bb 16. Sb 

food processing 

0 

6 

Forestry snd fishing 

Csrment (Apparel) 

1 Non-durable manufacturing 

other than garment 

3 Durable manufacturing 

0 Hlning 

45 Hotel or Rsstaursnt 

5 Retail trade other than 

restaurant 

2 Services other than hotel 

4 

3 

ba 

7 

Id50 

Irwnporttrtion 

Wholesale trade 

Other (specify) 

14 21 

ml50 N=YJO 

4. How did you hear about the job? (CHECK ONE.) 

mlForeiqn fomim 

82 bb 1. 126 Friends, acquaintsnces, 

rslstivsa 

16 50 2. fill Newspapsre 

5 2 3. 7 Sign in window 

9 3 4. 12 State employment agency 

24 lb 5. 30 Walk-in 

5 17 6. 22 Other (specify) 

7 20 27 Blr* 

BA50 It=150 NS3ClO 

5. Were you referred to the job by the atate 

employment agency? (CHECK ONE.) 

NmFomiqn forsiqn 

16 6 1. 22 Yes 

116 lbb 2. 260 No 

6 0 3. 6 Don't know 

12 0 12 Oldc 

I=150 IF150 k3lm 

6. Before you visited the employer, did you believe 

there wag B specific job vacancy? (CHECK ONE.) 

Nml- 

‘oreitm fooreim 

61 16 I. 137 Definitely yes 

57 46 2. 103 Probably yes 

10 16 3. 26 Undecided 

7 6 4. 13 Probably no 

6 1 5. 7 Definitely no 

5 5 6. 10 No baa18 to judge 

4 0 4 Blr* 

ll=lM WI50 N:300 

1 YOUR ANSWERS ARE ANONYMOUS. 1 

Page 152 GAO/GGD-9082 Employer Sanctions 
Appendix V 

Survey of Job Applicants 

7. Whsn you applied, did the employer tell you that a 10. When were you asked to show the documents? (CHECK 

specific job was avsllable7 (CHECK ONE.) ONE.) 

Non- thForeian foreign Foreion forsiqn 

82 97 1. 179 Defmtely yes 34 17 1. 56 Before the intervlew 

xl 23 2. 53 Probably yes m 18 2. Et3 During the interview 

15 ‘1.4 3. 31 Undecided 7 B 3. 15 After the int.erview, 

but before 1 wee 

4 7 4. 11 Probably no offered e job 

10 5 5. 15 Drflnitely no 14 10 4. 20 After 1 was otfered a 

job, but before 1 was 

6 1 6. 7 No basis to Judqki hired 

3 1 4 Blank 10 12 5. 22 After 1 web hired 

WlM l-G150 N-MO 4 1 6. 5 Don t remember 

8. Were you naked If you were eligible Co work 1” the rFl44 IF66 N=ZlO 

United States’ (CHLCK ONE.) 

11. Were you able to show the employer any ducumcllts? 

Non- (CHECK ONE.) 

Foreign forsiqn 

127 83 

km1. 210 Yea Foreiqn foreiqn 

16 66 

6 1 

1 0 

2. 02 No 141 64 1. 205 Yes (SKIP IO 

QUESIION 13.) 

3. 7 Don’t remember 

2 2 2. 4 NO (CONT~NUL To 

1 Blank QUESTlOh 12.) 

A50 r&50 NSCIO 1 0 3. 1 Don't remember (SKIP 

TO OtJESllON 16.) 

9. Were you eaked to show eny documents to prove that 

you ere authorized to work in the Urrited States7 II=144 IF66 N=210 

(CHECK OFtC.1 

154 66 I. 210 gee (CONTINUE To 

QUESTlOh IO.) 

6 e3 2. e9 No 

(SKIP IO 

0 1 3. 1 Don't remember 4 QUESTION 

16.) 

lWd50 rrnl50 *300 

1 YOUR ANSWERS ARE ANONYMOUS. 1 

Page 153 GAO/GGD-90-62 Employer Sanctions 
Appendix V 

Survey of Job Applicanta 

12. Wh+ weren't you able to show any ducuments? 

<CHECK ALL IHAI APPLY.) 

NonForeian foreign 

1 0 1. 1 1 didn't have 

documents 

0 0 2. 0 I dld"'t have the 

documents with me 

0 1 3. 1 The employer naked 

for specific document(s) 

that I dldll't hsve 

0 0 4. 0 I wsan't given time to 

acquire them 

1 1 5. 2 Other (apeclfy) 

nz2 n=2 N14 

IF YOU ANSWERED OUESIION 12, GO TO QUESTION 16. 

13. Whet document(a) did you aho@ (CHECK ALL THAT 

APPLY.) 

mnForeiqn Foreiqn 

50 53 1. 103 D~rver's license 

103 58 2. 161 Soclsl Security Card 

3 7 3. 10 Passport 

9 19 4. 28 811th Certlflcate 

127 1 5. 120 Immlgratlon document 

(for example, "green card") 

14 6 6. 20 Other (apeclfy) 

1 0 7. 1 Dwl't remember 

IF307 "444 N=451 

14. Did tns em~loyc~ accept the document(a)? (CHECK 

ONE.) 

NonFor&n ForeiqI! 

130 64 1. 202 Yea (SKIP IO OUESlION 16.) 

2 0 2. 2 NO (C~~N~INUL 10 QUESIION 15.1 

"Z140 r&4 N:204 

15. Why didn't the employer eccept the document(s)? 

(CHECK ONE.) 

NmForeiqn foreion 

0 0 1. 0 The employer vented 

enother specific type 

of documeht(s) 

1 0 2. 1 The employer didn't 

believe document(a) were 

authentic 

1 0 3. 1 Other (specify) 

0 0 4. 0 Don't know 

nr2 "=O N-2 

16. Were you offered the job? (CHECK ONE.) 

mnForeim forsim 

104 60 1. 164 Yea 

33 00 2. 121 No 

13 2 15 Blank 

1~150 n=150 NSllO 

17. Were YOU caked to complete en I-9 form? (AN I-9 

FORM Is SHOWN 0~ PAGE 6.1 (CHECK ONE.) 

NonForeiqn foraiqn 

90 54 1. 152 Yea 

31 85 2. 116 No 

24 Don't remetier I+ QUESTION 

(SKIP 10 

16 0 3. 

IS.) 

5 3 0 Blm* 

"El50 n45Ll Nr3M 

18. When did you complete the I-9 form? (CHECK ONE.) 

wonForeim forsiqn 

74 31 1. 105 Before I wee hlred 

18 20 2. 3e After 1 wee hired 

6 3 9 Blank 

II.98 n=54 N-152 

Page 164 GAO/GGIHO-62 Employer Sanctions 
Appendix V 

Survey of Job Applicants 

19. Were you born I” the United Stntes’ (CHECK ONE.) 22. Are you male or female? (CHECK ONE.) 

Nm- NmForsi(*, for&m Foreign foreiqn 

0 145 1. 145 Yes 90 a4 1. 974 Mule 

146 4 2. 150 No 59 b5 2. 124 Female 

4 1 5 Blank 1 1 2 Blmk 

l?=lM IFl5Cl NalD rcll5D A50 N-MO 

20. Which of the following beat describes your current 23. Do you speak English with B foreign accent? 

citizenship status? (CHECK ONE.) (CHECK ONE. 1 

b kmForzinnfpcIlpn Forsiqn foreign 

0 149 1. 149 Cltlze” or Natwnsl of 40 0 1. ho I don’t epeak English 

the Uruted States 

45 0 2. 45 I speak English with 

21 0 2. 21 Permanent resident alien a heary foreign accent 

127 0 3. 127 Temporary resident alien 65 0 3. 65 1 apeak English with B 

slight foreign accent 

1 1 4. 2 Other (specify) 

0 150 4. 150 1 speak English with 

1 0 1 Blank “0 foreign accent 

A50 It=150 NdBD 0 0 5. 0 No beais to judge 

21. Which of the following best descrrbes your ll=lM t-l=150 NalD 

ethnic/t aclal background? (CHECK ONE.) 

mmFor&p forciqn 24. If you have any comments on this eurvey, or on 

your experiencea in seeking e job, please use the 

3 3 1. 6 Asian space provided below. 

14 51 2. 45 Bleck 

1YD 7 3. 137 Huapanic/Latino 

0 104 4. 104 White (non-Hispanic) 

0 3 5. 3 Native American (North 

Ameruxn Indian) 

1 1 

2 1 

IFlM txl50 

183565 

GGD/MS/7-es 

6. 2 Other (specify) 

3 Bltok 

This concludes our survey. Thank you for your help. 

N300 

YOUR ANSWERS ARE ANONYMOUS. 

Page 156 GAO/GGD-SOS2 Employer Sanctions 
App&dix VI 

D&ta CoUection of State, Local, and private 

@ganizations on Employment-Related 

~crimination Complaints 

U.S. GENERAL A~~D~NTINI~ OFFICE 

DAIA CDLLECTlDk OF STATE, LOCAL, AND PRIVATE ORGANIZATIONS 

Oh EMPLOYMENT-RELATED DISCRIHINATIDN COMPLAINTS 

RECEIVED DURING THE PERIOD Dt’ JULY 1, 1988 THROUGH JUNE SD, 1989 

INSTRUCIIONS DRCAklZATIDN REPORTING 

OISCRIMINATIDN COMPLAINTS 

The U.S. General Accounting Dfflce, an agency of the 

Conqresa, 18 conducting a 3-year review of the I. Organization’s name: 

Imlgratlon Reform and Control Act of 1906 (IRCA). The 

purpose of thie survey la to gather information from 2. Address: 

state, local, and prlvste organizations on allegations 

made by individuals who claim to have been 

d~scrininated agalost 1” hiring, flrlng, or condition 

of employment. The data should be summarized 3. Name of contact person: 

allegationa received during the period July 1, 1988 

through June 30, 1989. Flo indlvlduul’a 01‘ employer’s 4. Telephone number: 

name need8 to be given to us. (Area code) owmber) 

Ihe U.S. General Accourltlng Dfflce will we this data, DISCRIMlNATlDk COMPLAINTS RECEIVED 

along with data from a number of other aowces in 

reporting to the Congreea on whether the employer 5. Dlscriminatlon data should be provided for July 1, 

sanctions provIsion of IRCA has caused a widespread 1988 through June 30, 1989. Please specify the 

pattern of discriminstlon against United States actulcl period for which your data WBB collected. 

citizens or authorized aliens. If we conclude 

aft’i1~mstlvely, and the Congrees concu~e, the law From / / / / Through / / / / --- 

provides ewpedlted procedures for the repeal of IRCA’e UN DD YY tm Do YY 

employer aanct ions. If we conclude there is no 

slgnlflcant dlscrinnlnatlon and the Congress concur, 6. Total number of individuals 

the law provides expedited procedures for the repeal of reporting employment-related 

the ant)-dlecriminat.lon provialons only. Consequently, dlscrimlnatlon complaints: 1PJ 

you a881etance 1” the collection of this date will be 

very helpful in drafting our report to the Congress. 

We may need to contact someone in your organization to 

clal lfy some of the informat Ion. Please be sure to 

include a name and telephone number where we can 

follow up as necessary. 

Pleaae submit your data to ua no later than July 29, 

1909 eo that we may have time to consider it in our 

I‘WlCV. Your report should be mailed to the following 

add! eas: 

U.S. General Accounting Office 

Mr. John D. Carrera 

Regional Assignment Manager 

26 Federal Plaza, Room 4112 

New York, luY 10278 

If you have any questions, please call Mr. John Carrera 

at (212) 264-7973. Thank you 80 much for your help. 

Page 166 GAO/GGD9O82 Employer !Qu~ctiona 
Appenatx VI 

Data C!ollection of State, Local, and private 

~ganizatione on Employment4Lelate.d 

Dbcrlmination Complainta 

7. Plauee provide “(1 with B count of the types of discrimination iaauea alleged by the individusl. While 

individuals may allege more than one issue, w! can only count one for each individual, 80 we would like you 

to identify the primary isaue. If an individual alleges hiring or Firing 88 en ieaue at all, please 

conaider it the primery leeue. If hiring or firing is not mentioned ee en issue, consider it under working 

conditlona snd lndlcete the first allegation mentioned. (PLEASE USE ONLY ONE ISSUE PER INDIVIDUAL.) 

I INDIVIDUAL'S SlATus I 

United States Authorized Un-authorized statue 

citizen alien alien unknown TOTAL 

DlSCRIHINAllON ISSUE (1) (7.1 (3) (4) (5) 

1. Aefuaal to hire 33 190 37 D 260 

2. flred 10 251 111 0 372 

3. Working currdltlons 

A. Wage reduction or extension 

of work howe 1 215 

8. "Kickback" payment to 

employer to get or keep B 

job 0 5 

C. Other wrklng condltlons 

(Please specify) 

4 167 

62 

1 

36 

0. TOTAL OF LINES IA, 30, AND 

3C 5 387 99 15 5D6 

4. Unable to deternune 1 36 12 13 62 

5. IOIAL (ADD LINES 1, 2, 30, end 4) 49 86b 259 28 1,200 

I THE NUMBER IN "TOTAL COLUMN, LINE 5" SHOULD EQUAL TOTAL INDIVIDUALS IN QUESTION 6. I 

Page 157 GAO/GGLMOS2 Employer Sanctions 
Appendix VI 

Data CMlection of State, Local, and Private 

Organhatione on Employment-Related 

Discrimination Complainta 

8. Individuala may have report VII~DXI~ types of employer ections. Please use the first action they mentioned, 

end provide us with the number of individuals who said the employers did any of the following. If data ie 

not svrileble, plaese write "N/A" for not available. 

INDIVIDUAL'S STATUS 

United States Authorized Un-authorized statue 

citizen allen alien unknown TOTAL 

WHAT THE EMPLOYER DID . . . (1) (2) (3) (4) (5) 

1. Required U.S. citlrenship 5 25 11 0 41 

2. Required a Permanent Restdent 

Card (green card) 0 37 8 D 65 

3. Did not accept a valid work 

authorizntlon document 24 272 3 0 299 

4. Retellated because allen became 

legallred 0 147 0 0 147 

5. Retelleted becwae alien asked 

for employer’s eesistance wth 

lsgaliration applxstion 0 10 12 0 22 

6. Other employer actlo” 

(please specify) 

19 322 216 15 572 

7. Unable to determine 1 31 9 13 54 

8. TOTAL (ADD LINES 1, 2, 3, 4, 5, 

6, AND 7). 49 M4 259 20 1,200 

THE NUMBER IN "TOTAL COLUMN, LINE 8" SHOULD EQUAL TOTAL INDIVIDUALS IN OUESIIDN 6. 

Page 158 GAO/GGD-90-62 Employer Sanctions 
Appendix VI 

Data Collection of State, Local, and Private 

Organizations on Employment-Related 

Discrlmhtion Complaints 

-t 

Y 

9. For the indhviduals indentlfled IIT Ouestion 6, please indicate their immigratmn status. 

Nuder of 

individuals 

1. Aut.horired workers 913 

2. Unsuthorlzed workers: 

A. Hlred E!JTOR[: November 7, 1966 121 y 

8. Hlred AFIER November 6, 1986 115 y 

C. TOTAL unauthorized workers (ADD LINES 2A and 28) 259 

1. Unknown 2B 

4. IOIAL Of LINES 1, ZC, AND 5 1.200 

10. Provide the number of authorized workers reported in QMSlION 9, LINE 1 for all ethnic/race categories 

below. 

ETI~NIc/RAcE CATfGoRY 

1. Asian end paclflc islanders 

United States Authorized 

tit lzen alien 

(1) (2) 

0 12 

TOTAL 

(3) 

12 

2. Blacks (non-Hispanics) 1 34 35 

5. Hispanics SB 724 762 

4. White (non-Hispanics) 3 10 13 

5. Other (specify) D 2 2 

6. Unknown 0 4 a9 II/ 

7. TOIAL (ADD LINES 1, 2, 3, 4, 5, AND 6) 42 l&i 913 Y 

I THE NUMBLIR IN THE "TOIAL COLUMN, LINE 7" SHOULD EOUAL THE 

TOTAL NUMBER Of AUTHORIZED WORKERS IN QUESTION 9, line 1. I 

e/ Total for 12 orgsnlzation?; data not wallable for 2 organizations. 

6 -/ Total for 13 organizations; data not wallable for 1 organizeion. 

L/ Becrruse of mieslng data, computation of total is only for the column and not for the row. 

Page 159 GAO/GGD99-62 Employer Sanctions 
Appendix M 

Data Collection of State, Local, and Privati 

Organizatlone on EmploymentJtelated 

Discrimination Complaints 

11. Of the authorized workers (8s stated ~n OUESllOhr 9, LINE I), how lnany wcre~ 

Nun'ber of 

individuals 

1. United Stetev citizens 49 

A. Number of U.S. cltlzens that were Puerto Rican 18 9 

2. Permanent resldents (green card) 52 

3. Temporary residents 508 

4. Asylees/Refugees 21 

5. Other legal atalus (please specify) 237 

6. Leqal etatua coteqor,' urlknuw 66 

7. TOTAL OF ~1Nf.s 1, 2, 3, 4, 5, AND 6. 913 

12. Accoxdlng to the Equal Employment Opportunity Commission (EEOC), a national origin complaint is related to 

the empluyer sanctions provx+lons of IRCA If the employer: 

1. asked only individuals of a particular national origin, or individuals who “looked foreign”, for 

verlflcntion of their legal authorlzstlon for employment; 

2. scrutwared more closely, or refused to accept, the documents submitted by individuals of a partxular 

nat.ional origin to prove their identity OP uuthorizstion for employment; 

3. touk any other ectlon that was motlvated by the employer's concsrne about complying with the nrw 

unnigtatiorl law; O* 

4. had citlrerishlp requirements or preferences when there is no other federal law, reguletion of 

contractual arrangement requlrurg him to do so. 

Of the complalnta received from authorized workers (as stated in QUESTION 9, LINE l), how nany has your 

organization ldrntlfled as being employer ssnctwns-related using the EEOC criteria? (IF THE lNFORMAllOk IS 

NOT AVAILABLL, ElrrlER "WA".) 

Number of complaints: 567 

df Total for 11 organlzatlons; data nut wallable for 3 organizations. 

Page 160 GAO/GGD4042 Employer Sanctions 
Appendix VI 

Data C4lection of State, Local, and Private 

Organhtions on Employment-Related 

Discrimination Complalnta 

13. OPTIONAL NARRAIIVE: If you have comments or additional information that you feel may be useful to the 

Caners1 Accounting Office, please provide them below. Attech additional pages es needed. 

Thonk you for your aeeletance. 

Page 161 GAO/GGD-SOS% Employer Sanctions 
Appkndix VII 

Mqjor Contributors to This Report 

Geberal Government Lowell Dodge, Director, Administration of Justice Issues 276-8389 

Di 

4 

ision, Washington, Alan M. Stapleton, Project Director 

D. : . 

Linda R. Watson, Deputy Project Director 

C. Jay Jennings, Deputy Project Director 

Gail Johnson, Senior Social Science Analyst 

Harriet Ganson, Senior Social Science Analyst 

Margaret Schauer, Senior Social Science Analyst 

James Bell, Operations Research Analyst 

Robert Johnson, Statistician 

Lynda Hemby, Typist 

/ 

Office of General 

CoLmsel 

Henry Wray, Senior Associate General Counsel 

Ann H. Finley, Senior Attorney 

Atlanta Regional Mario L. Artesiano, Site Project Manager 

Office 

Dallas Regional Office Arthur L. Nisle, Site Project Manager 

Chicago Regional Harriet Drummings, Site Project Manager 

Office 

Lds Angeles Regional Michael P. Dino, Site Project Manager 

Office 

New York Regional 

Office 

John D. Carrera, Site Project Manager 

(18aaea) Page 162 GAO/GGD99-62 Employer Sanctions 
‘I’t~lt~phorlt~ 202-275-6241 

‘I’tw first, l?vth cwpiw of’ tw+ rtqmrt. art f’rtw. Atlctit~itmal cwpiw m-t’ 

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