Undocumented Hirings May Rise During Shutdown With E-Verify Offline

(Bloomberg) -- Restaurants hungry for workers say they’ll keep hiring even though a government system to help them weed out undocumented employees is, ironically, not working because of the government shutdown over immigration.

E-Verify, a web-based Department of Homeland Security program to confirm recently hired employees are authorized to work in the U.S., is one of the government services that’s not running amid the standoff between President Donald Trump and Congress. Companies trying to use it are met with a red banner: “Due to the lapse in federal funding, this website will not be actively managed.”

There’s no way restaurants can slow hiring now, even with an increased risk of bringing on undocumented workers, said Trent Colford Sr., regional director of operations at Hamra Enterprises, which operates 90 Wendy’s locations. The industry is facing a severe worker shortage amid a low unemployment rate, fewer young people in the workforce and competition from gig-economy employers.

Undocumented Hirings May Rise During Shutdown With E-Verify Offline

“We’re definitely exposed, and there’s an increased risk,” Colford said in an interview. “Of the people that we’ll hire in this time frame, 95 percent of them will be OK. So there’s probably that 5 percent that will be at risk.”

Hamra, which also operates Panera Bread and Noodles & Co. stores, uses E-Verify to check on new hires. While the system is mostly voluntary, 24 states have some sort of requirement for employers to use it, according to LawLogix. Dunkin’ Brands Group Inc. compels its franchisees to use E-Verify, and Chipotle Mexican Grill Inc. uses the system as well.

“We are continuing to hire and complete the necessary paperwork just as we normally do,” said Laurie Schalow, a spokeswoman for Chipotle, which doesn’t franchise and had almost 64,000 hourly workers as of December 2017. Wendy’s Co. says the company has looked into it and isn’t aware of any disruptions to its hiring because of the shutdown.

Dunkin’ Brands is “hopeful the government shutdown will end to ease this burden,” Mike Shutley, the chain’s vice president for government affairs and sustainability, said in a statement.

Connection to Labor

The partial government closure, now approaching its fourth week, was triggered just before Christmas as Congress spurned Trump’s request to spend more than $5 billion to build a wall along the U.S.-Mexico border.

The shuttering of many U.S. government services and websites is likely to continue as Trump shows no signs of capitulating. On Wednesday, he walked out of a shutdown meeting with congressional leaders, calling it a “waste of time.”

The shutdown is “connected to the labor issue in many ways,” said Jamie Richardson, vice president at White Castle. “The economy is growing and labor pools are tight, and we need more people. So hopefully they can continue to have some dialogs and work some stuff out.”

White Castle said only six of its restaurants in Tennessee use E-Verify, and that they’re not changing much. Since the shutdown, the locations have hired 16 people, and are keeping a computer spreadsheet with information to use when the site is running again.

“We’re just holding the records, and then the intent is just to run them when everything is back online,” Richardson said.

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