Florida's E-Verify Bills Are Not A Compromise For Business Owners

January 27, 2020 Topic: Politics Blog Brand: The Buzz Tags: FloridaEmploymentEconomicsBusiness

Florida's E-Verify Bills Are Not A Compromise For Business Owners

The bills are a stealth universal E‑Verify mandate.

Florida state Representative Cord Byrd (R) and state Senator Joe Gruters (R) recently introduced bills that would impose a stealth universal E‑Verify mandate on all new hires in their state. Many in the media are reporting their bills as a compromise that will subject state employers to E‑Verify (even though former Governor Rick Scott signed an executive order that already subjects them to E‑Verify), but that will not mandate E‑Verify for private employers.

That is simply not true.

The bills are a stealth universal E‑Verify mandate. They would force all private employers to either use E‑Verify or a second means of work authorization by January 1, 2021. That second means of work authorization is a more onerous version of the current federal I‑9 requirement that would force the worker to provide a picture identification compliant with the REAL ID Act and one of the following CERTIFIED documents to his or her new employer: birth certificate, certification of naturalization, a certification of citizenship, an alien registration receipt card, or an immigration I‑94 form stamped “employment authorized.” The employer would then have to keep a copy of the certified document on file.

A certified copy means, in the case of a birth certificate, that it needs to have the “official state registrar’s raised, embossed, impressed or multicolored seal, registrar’s signature, and the date the certificate was filed with the registrar’s office, which must be within one year of the person’s date of birth.” A mere photocopy of a birth certificate would not suffice. I just tried to order a certified birth certificate from Florida under the online credit card payment option from Miami‐​Dade county. The fee was $37. A $37 tax on workers for getting a new job isn’t consistent with Governor DeSantis’ laudable efforts to reduce regulatory barriers to higher employment elsewhere in Florida.

Another curious provision of the E‑Verify bills is that they recognize fewer documents as evidence of lawful residence and work authorization than federal I‑9 requirements do. For instance, the Florida E‑Verify bills do not include a U.S. Passport or Passport Card as evidence of legal residence and work authorization. The bill says that the “private employer must retain a copy of the documents provided under this subparagraph for at least 3 years after the person’s initial date of employment,” which I assume means that the employer will not have to keep the actual certified document itself. So why should a U.S. Passport not be allowed – unless the bill actually intends that the certified original document must be held by the employer?

If the second suped‐​up I‑9 option for worker identification in the Florida bill was just a word‐​for‐​word recreation of the federal I‑9 requirement that currently burdens American employers with at least 13.5 million annual man‐​hours of checking and filing government forms, that would be one thing. Such a requirement would be redundant to current federal law and wouldn’t add any additional regulatory burden. Presenting a passport and, at most, requiring the employer to keep a photocopy should be more than sufficient.

There is no reason to shrink the number of available documents that employers can use to verify work eligibility unless the intent is to make the alternative suped‐​up I‑9 more burdensome for workers and employers, with the ultimate intent to push as many employers as possible into using E‑Verify. With such a “choice,” where employers must pick either E‑Verify or a suped‐​up I‑9 that also burdens their new hires, most businesses and employees will “choose” E‑Verify. Thus, Floridians will be burdened with a universal E‑Verify mandate sold as a compromise non‐​mandate because the other second option of a suped‐​up I‑9 is relatively more onerous.

Even weirder, the bills require a REAL ID‐​compliant form of photo identification. A resident of Florida can get a REAL ID‐​compliant form of photo identification by showing a valid U.S. Passport or Passport Card along with another form of identification, such as a Social Security card, along with evidence of residency in Florida. If a native‐​born American worker can get a REAL ID‐​compliant drivers license in Florida with a U.S. Passport and a Social Security card, he or she should also be able to get a job by showing those documents to their new employer. It should be at least as easy to get a job as it is to go through the TSA line at the airport.

These bills are not a good‐​faith compromise, they will create an E‑Verify mandate. If Byrd and Gruters want to give DeSantis a political win without imposing an E‑Verify mandate, they should just recreate the I‑9 requirements word‐​for‐​word on the state level. E‑Verify shouldn’t even be on the table at this point.

In addition to the recent bills that would impose a stealth E‑Verify mandate in Florida, a new NBER working paper by economists Shalise Ayromloo, Benjamin Feigenberg, and Darren Lubotsky shows why such a mandate would be unwise. They found that an E‑Verify mandate reduces the employment and wages of illegal immigrants as the proponents of those laws desire. However, E‑Verify also does not reduce the illegal immigrant population in states where it is mandated nor does it open up jobs for native‐​born Americans, especially lower‐​skilled Americans. At best, E‑Verify somewhat delivers on one of its three promises.

According to Tables 4 and 10 in their paper, E‑Verify reduces the employment of illegal immigrants by 19 percent (significant at the 1% level) and their per capita wage income by 26.3 percent (significant at the 5% level). However, they also find that E‑Verify reduces the employment of native‐​born American high school dropouts by 2.7 percent (significant at the 5% level) and young male native‐​born American high school dropouts by 6.8 percent (significant at the 1% level). E‑Verify cuts the per capita wage income of all natives by 3.6 percent, native dropouts by 4.5 percent, and young male native high‐​school dropouts natives by 7.7 percent – all significant at the 5% level.

In other words, E‑Verify lowers wages and employment for illegal immigrant and low‐​skilled native‐​born Americans. Among native‐​born Americans, the especially negative effects are concentrated on the lowest‐​skilled American men who can least afford to pay for E‑Verify’s regulatory burden. Proponents of E‑Verify frequently state that it is a “free” government program. That is not true. In addition to the taxpayer costs of running E‑Verify, it also levies a heavy tax on the least skilled American workers.

The paper also finds that the cost of an E‑Verify mandate disproportionately falls on larger firms because small firms are much less likely to comply with E‑Verify mandates. This contrasts with what many of us have thought about the disparate negative economic impact of E‑Verify. As the authors explain, larger firms are more likely to comply with E‑Verify and smaller firms are not, so there is a slight shift in employment toward smaller firms that do not comply with the costly regulatory burden and away from bigger firms that do.

Lastly, the most important finding in this new paper is that mandatory E‑Verify does not reduce the illegal immigrant population on the county level. The authors bury the figure for this result in the appendix (Figure A6). Although E‑Verify lowers employment and wages for illegal immigrants, it does not force them out of the state. Perhaps it disincentivizes new illegal immigrants from moving there, but that remains to be seen. E‑Verify sounds like it produces the worst possible outcomes: Lower illegal immigrant employment and wages, lower native‐​born employment and wages, and no decrease in the illegal immigrant population. Who could possibly think that artificially increasing the number of people who cannot work and who have lower wages thanks to E‑Verify is a good thing? Yet that is exactly what E‑Verify will do in Florida if these bills become law.

The E‑Verify bills proposed in Florida are not a compromise in any meaningful sense of the word. The bills mandate E‑Verify for government agencies and contractors, which is already law in Florida thanks to an executive order by Rick Scott. Worse, they create a stealth E‑Verify mandate for all new hires beginning on January 1, 2021. When “choosing” between E‑Verify and second more‐​intense I‑9 offered in the bills, just about everybody will choose E‑Verify. A universal E‑Verify mandate imposed through this means is still a universal E‑Verify mandate despite what its supporters say.

This article by Alex Nowrasteh first appeared at the American Enterprise Institute.

Image: Reuters.