Frustrated with federal foot-dragging on immigrant-worker issues, lawmakers in Arizona and Colorado are considering measures to create state guest-worker programs as foodservice constituents, and operators in neighboring states, face labor shortages seen as worsened by local crackdowns on undocumented employees.
The Arizona proposal would create that state’s own temporary-worker system to help address labor shortages in the agriculture, construction, restaurant and hospitality industries. Another pending measure there would revise the 2007 state law that threatens employers with business license revocations for knowingly hiring illegal workers.
The Colorado proposal would set up a guest-worker program for that state’s seasonal agriculture industry, but debate over the issue in the Colorado House has led to rebukes of at least one lawmaker who called immigrant workers “illegal peasants.”
“The system is broken,” said Pete Meersman, president and chief executive of the Colorado Restaurant Association. “I’ve heard our members remark several times that this immigration issue is the most important issue that they have faced in their restaurant careers.
“They are telling me that of all the issues they have faced—minimum wage, smoking bans, business meal deduction—you could roll them all up into one ball and it would not be as large as what we see as the threat that we may not be able to staff our restaurants.”
In Arizona, the state House and Senate both are considering legislation that would create a program to provide temporary foreign workers for businesses with labor shortages. Proponents say the state’s businesses can’t wait for the U.S. Congress to overhaul immigration policies. Arizona would need the approval of the federal government for the proposed state-run program, which the Arizona Restaurant and Hospitality Association supports.
Steve Chucri, president and chief executive of the ARHA, said: “The real question is whether the feds will grant the waiver as provided in the legislation, which is unlikely. However, it sends the message to Washington that we need reform, and if other states pass similar legislation then we may get results in Washington.”
The Arizona Senate also is considering a bill, SB 1374, that would change last year’s sanctions law, which allows authorities to suspend the business licenses of companies that knowingly hire undocumented workers and revoke them permanently for repeat violations.
Proposed changes to the law, generally regarded as the strictest of its kind in the nation, still are being discussed in the state Senate, but are expected to include the application of penalties only for workers hired after the law’s Jan. 1, 2008, effective date, and the establishment of a new voluntary compliance program.
P.F. Chang’s China Bistro chairman and chief executive Rick Federico, speaking at a foodservice conference in Los Angeles April 24 about the immigration-related legal climate affecting his Scottsdale, Ariz.-based chain, said, “Arizona is a miserable state to be in the restaurant business.”
Federico said it had appeared at one time that Arizona’s controversial law would extend culpability for hiring infractions at a single restaurant to the potential shutting down of entire chains, and he said Chicago-based colleague Richard Melman of Lettuce Entertain You Enterprises had halted a $3 million Arizona investment in a Big Bowl restaurant branch because of uncertainties affecting the state’s labor market.
“Really, the only thing we think we can do is be consistent regarding what our practices are,” Federico said, noting that P.F. Chang’s participates in the federal E-Verify system for authenticating workers’ lawful status. Seventy percent of his employees who’ve been identified as having mismatched Social Security account information through the federal database eventually reconcile those discrepancies, though the other 30 percent “just go away” and abandon their jobs.
A Phoenix restaurant operator, who asked not to be named for fear of drawing attention to his own hiring program, cited a recent Arizona Republic editorial that called Arizona’s license-revocation statute, which is still being challenged in the courts, “a two-strikes employer-sanctions law that is the legislative equivalent of trimming your fingernails with an ax.”
Oklahoma and Colorado last year passed similar laws that address immigration, but Meersman said they are having deleterious effects on business.
“They have placed sanctions on employers, and they have reduced services to people who are not in the country illegally,” Meersman said. “That has caused not only those illegal immigrants to leave, but when they leave they take their entire families. Some of those family members may have been in the country legally. In any case, legal or not legal, we have seen the number of the workforce go down.”
Resort restaurants in Colorado suffered the effects of those labor shortages, he added.
“Resort areas have been hit especially hard,” Meersman said. “I’ve heard of restaurants in resort areas where they have had, with a record snow season, a record number of skiers from around the country. That has produced lines outside restaurants, but yet the operator can’t seat all the tables because he doesn’t have the service personnel to take care of them. Ski areas have experienced worker shortages.
“There has been some mean-spirited legislation passed here that has led to worker shortages.”
Meersman said operators are preparing to deal with revised plans by the Department of Homeland Security and the Social Security Administration to issue “no-match” letters aimed at rooting out employment document fraud. The plan, which was challenged in court last year by the AFL-CIO, the American Civil Liberties Union and other groups and must be approved by a federal judge, would give business owners 90 days to explain any discrepancy when alerted that workers’ Social Security numbers are not valid. The proposed regulation would require the employer to fire workers that can’t promptly reconcile account discrepancies.
“Immigration reform is the most important domestic issue this country is facing right now,” Meersman said. “The refusal of Congress to act on this is disgraceful. Our senators and representatives were not sent to Washington to draw lines in the sand. They were sent there to work on solutions to complicated problems.
“There is no question this is a complicated problem,” he continued, “and it’s a problem to not find some common ground on this issue that is so important to our security, our labor force and our economy.”
