Monday, March 15, 2010

The "Local Preference" in Hiring

On March 10, 2010, the Marianas Variety printed an article with the title “Labor Wants Floating Benchmark to Prioritize Hiring of Locals”. According to this news, Deputy Labor Secretary Jacinta M. Kaipat encourages the CNMI Legislature to replace the local law that sets a quota for employers to hire 20% (and increasing to 30%) local/U.S. citizen labor with floating benchmarks. These benchmarks would be tied to population statistics about the labor force and set a priority for hiring local/U.S. citizen employees.

This blog post discusses some of the legal issues presented in this matter.

Control of foreign labor
When the CNMI controlled its own immigration, it could set terms and conditions for employment of foreign workers; and by extension, it could set terms and conditions for quotas of local/resident work force before employers could utilize alien labor. But the CNMI no longer has that authority. U.S. law governs not only entry and exit of aliens, but also their employment.

Judge Friedman, in the case brought by the CNMI to challenge federalization of immigration, CNMI v. U.S., #08-1572 (U.S. Dist. Court, D.C., 11/25/2009)said:
“[P]laintiff (CNMI) is just plain wrong when it asserts that nothing in federal immigration and naturalization law permits an “employer-by-employer, worker-by-worker local labor permitting scheme.” ... As defendants point out with ample support... precisely such schemes are at the heart of federal immigration law. ... Finally, and for similar reasons, the fact that the application of federal immigration laws to the CNMI through the CNRA (P.L. 110-229) may have a dramatic impact upon the CNMI’s labor force does not convert an immigration law into a labor law. It has long been recognized that the immigration laws necessarily have a significant impact on labor markets and practices.... There is thus no question that the relevant portions of the CNRA are immigration laws explicitly authorized by the Covenant.”

It is clear that the CNMI lost control of immigration, and with that, control of alien labor to the extent it is any different than local labor. The CNMI cannot now set conditions on hiring foreign workers or establish preferences for hiring local labor, with the exception of bona fide requirements. The present CNMI quota law embodies preferences that now create unlawful discrimination.

Ombudsman Pam Brown, in response to a question I posed to her on this subject, said:
“The conditions for employment of aliens contained in the Non-Resident Workers Act and P.L. 15-108 were tied to immigration control and thus, were not restricted by Title VII or IRCA. Once the CNMI lost control of immigration under P.L. 110-229, it also lost the authority to condition employment of aliens in violation of federal law and constitutional protections.”

Unlawful discrimination
Under US law, it is illegal to discriminate in hiring, firing, and some other matters based on citizenship.

1) Title VII prohibits discrimination based on “national origin.” This includes not only intentional discrimination tied directly to national origin but also practices that have an adverse impact relative to national origin. Adding a citizenship requirement to hiring decisions in the CNMI would adversely impact many specific groups based on national origin—including citizens of the FSM, Palau and the Marshall Islands, and US permanent residents and others who are present and lawfully eligible to work from the Philippines, China, Korea, Japan, Bangladesh and other countries. Such a “citizenship’ requirement imposed by employers would be illegal discrimination unless it was tied to actual bona fide job needs (such as meeting security classifications for some federal jobs in transportation, etc.). The EEOC enforces these provisions.

The EEOC website says
“Employers who impose citizenship requirements or give preferences to U.S. citizens in hiring or employment opportunities also may violate IRCA.”

Implicit in the word “also” is that such practices violate Title VII, absent bona fide job qualifications.

Can the CNMI, by passing legislation that sets residency or citizenship requirements, create bona fide job qualifications? It would seem that the CNMI would need a compelling state interest to engage in such discrimination. A preference for US citizens would be the province of the US government, and federal law would likely pre-empt CNMI law on the subject. U.S. law has already set a balance.

2) The Immigration Reform and Control Act (IRCA), §274B, 8 U.S.C. §1324b, specifically prohibits citizenship or immigration status discrimination with respect to hiring, firing, recruitment or referral for a fee by employers with four or more employees. The Office of Special Counsel enforces the anti-discrimination provision. Their website says:
“Employers may not treat individuals differently because they are, or are not, U.S. citizens.”

In essence, anyone who is lawfully present and permitted to work as a matter of federal law is entitled to an equal chance at employment, regardless of whether they are a U.S. citizen or hold some other immigration status. Employers in the CNMI must comply with this law through the I-9 process.

There are some lawful considerations that might disfavor hiring foreign workers in the CNMI. Employers are not required to sponsor alien workers for H1 categories; nor are they prohibited from considering the length of time a worker (say, under an umbrella permit) may be available for the job. Questions in the hiring process about citizenship or specific immigration status beyond eligilibity to work, however, could give rise to an inference of discrimination.

Floating benchmarks/Hiring goals
The call for change is from the quota system to “floating benchmarks” which are described as similar to “hiring goals.” The idea, I think, is to have targets (benchmarks) for how many U.S. citizens should be employed by any employer, based on the percentage of citizens in the general labor force here.

I found some guidance about what “hiring goals” are on the Berkeley Lab human resources website. The following series of questions and answers provides insight into what hiring goals really are.

Q: What is the difference between quotas and placement goals?
A: Quotas are either a ceiling or a floor for the employment of minorities or women. Placement goals are reasonably attainable objectives or targets that are used to measure progress toward achieving equal employment opportunity.

Q: What does the Laboratory do to meet its placement goals?
A: The Laboratory makes good faith efforts to remove identified barriers, expand employment opportunities, and produce measurable results.

Good faith efforts include broad advertising of job openings; supplemental inclusive outreach efforts to ensure that all qualified candidates, including minorities and women, are represented in applicant pools; and careful monitoring of outreach, recruitment, search and selection practices to ensure that equal opportunity is provided at every stage of these processes.

Q: Do good faith efforts include extending preferences in hiring minorities and women when trying to meet placement goals?
A: No. According to the Federal regulations, placement goals do not provide a justification to extend a preference to any individual on the basis of that person’s race, ethnicity, or sex.

Q: Will setting placement goals lead to preferences in hiring?
A: No. According to the Federal regulations, placement goals do not create job set-asides for specific groups, nor are they intended to achieve proportional representation or equal results.

Q: Can the Laboratory hire less qualified individuals in order to meet its placement goals?
A: No. Placement goals may not be used to supersede merit selection principles or as a justification for hiring a less qualified individual in preference to a more qualified individual. The Laboratory’s policy is to select the individual who possesses the qualifications to perform the duties of the position most effectively.”

From these questions and answers, it is clear that the thrust of “hiring goals” is affirmative action and equal employment opportunity. They aren’t traditionally used to promote hiring of the dominant segment of U.S. citizens in preference to other eligible foreign workers. They are not a way to lawfully “discriminate” or give “preference” to any one. They are, in contrast to discrimination and preferences, utilized by removing barriers to employment and using broad advertising of job openings, outreach, and equal opportunity at every stage of the process.

Final analysis
If the goal of the recommendation by the CNMI DOL is to favor local residents or even U.S. citizens, the proposed legislation is likely illegal and unconstitutional. U.S. federal law pre-empts the CNMI’s right to pass laws about foreign labor that are significantly different in purpose and effect than the U.S. laws. No state or local government can evade the equal protection of the law that is extended to all people present in the jurisdiction.

If the goal is to do a better job of making sure all qualified candidates know about jobs and apply for them, then it is permissible. There just can’t be any “prioritization” of hiring locals under cover of citizenship.

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