First Regular Session Sixty-seventh General Assembly STATE OF COLORADO INTRODUCED LLS NO. 09-0237.01 Christy Chase SENATE BILL 09-023 SENATE SPONSORSHIP Schultheis, HOUSE SPONSORSHIP Lambert, Senate Committees House Committees State, Veterans & Military Affairs A BILL FOR AN ACT Concerning the verification of the work eligibility status of new employees through the federal electronic verification program. Bill Summary (Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments that may be subsequently adopted.) Repeals the current requirements imposed on employers to examine, and retain records of examining, the legal work status of new employees and instead creates the "Fair and Legal Employment for Coloradans Act" (act), which requires all nongovernmental employers in the state to participate in the federal electronic verification program (e-verify program) for purposes of verifying the work eligibility status of all new employees hired by an employer. Establishes deadlines by which employers must start participating in the e-verify program, based on the number of employees of the employer, and requires the attorney general to impose fines on an employer for failure to participate in the e-verify program or to provide documentary proof of participation. Prohibits an employer from intentionally or knowingly employing an unauthorized alien, and requires an employer to immediately terminate an employee for whom the employer receives a final notice of nonconfirmation of work eligibility through the e-verify program. Requires the attorney general or the county or city attorney, as appropriate, to investigate complaints of employer noncompliance. Requires the appropriate county or city attorney to bring a court action against the employer when an investigation shows a complaint has merit. Upon finding a violation, requires the court to order the employer to: Terminate the employment of all unauthorized aliens; Be subject to probation, during which the employer must submit quarterly reports of all newly hired employees to the county or city attorney; and Submit a sworn affidavit attesting that the employer has terminated the employment of all unauthorized aliens. For knowing violations, allows the court to order the suspension of the employer's business licenses. For intentional violations, requires the court to order the suspension of all business licenses for a minimum period. For a second violation, requires the revocation of all business licenses. Requires the attorney general to maintain copies of, and provide access to, all court orders issued against employers and to maintain a database of employers with a first violation. Requires the department of revenue, in cooperation with the department of labor and employment, to provide a notice of the requirements of the act to employers obligated by law to withhold taxes for employees. Creates the e-verify program cash fund, to consist of moneys collected as fines imposed on employers for failing to participate in the e-verify program. Authorizes the moneys in the fund to be used to cover the reasonable costs incurred by the attorney general, county attorneys, and city attorneys in administering and enforcing the requirements of the act. Defines as a discriminatory or unfair employment practice the refusal to hire or termination from employment of a United States citizen or permanent resident alien while hiring or retaining an unauthorized alien in the same type of job when the employer knew or should have known that the person was an unauthorized alien. Be it enacted by the General Assembly of the State of Colorado: SECTION 1. Part 1 of article 2 of title 8, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SECTION to read: 8-2-125. Verification of employee work eligibility status - short title - legislative declaration - definitions - e-verify program - cash fund. (1) This section shall be known and may be cited as the "Fair and Legal Employment for Coloradans Act". (2) (a) The general assembly hereby finds and determines that: (I) Ensuring that Colorado employers employ only those persons eligible to work within Colorado is an issue of statewide concern; (II) It is in the best interest of citizens and employers in Colorado for all employers to follow federal law as it applies to the hiring of persons who are authorized to work in the United States; (III) Employers who violate federal employment laws with respect to the hiring of persons who are unauthorized to work in the United States place an undue economic burden on employers who attempt to hire only persons who are authorized to work in the United States; (IV) Strict adherence to legal hiring practices will decrease illegal immigration into Colorado and substantially reduce the millions of dollars leaving Colorado's economy each year and going to other countries; and (V) Employers in Colorado who illegally hire unauthorized persons create an attractive environment for illegal immigrants to locate within Colorado, which costs taxpayers hundreds of millions of dollars to provide public education, health care, and other services and, in addition, places undue strain and costs on our judicial system. (b) The general assembly therefore finds and determines that it is: (I) In the best interest of the state's taxpayers for all employers to verify the social security numbers and work eligibility status of newly hired employees; and (II) Important that every employer in Colorado participate in the federal employment verification program, known as "e-verify", for the purpose of verifying the work eligibility status of newly hired employees. (3) As used in this section: (a) "Agency" means any department, division, board, or commission of this state or of a county, city, or city and county that issues a license for the purpose of operating a business in this state. (b) "Business license" means any license issued by an agency to an employer that is necessary for the employer to operate its business. (c) (I) "Employer" means a person transacting business in Colorado who, at any time, employs another person to perform services of any nature and who has control of the payment of wages for such services or is the officer, agent, or employee of the person having control of the payment of wages. (II) "Employer" does not include the federal government, the state of Colorado, another state, or a political subdivision of Colorado or another state. (d) "E-verify program" or "program" means the electronic employment verification program that is authorized in 8 U.S.C. sec. 1324a and jointly administered by the United States department of homeland security and the social security administration, or its successor program. (e) "Unauthorized alien" has the same meaning as set forth in 8 U.S.C. sec. 1324a (h) (3). (4) (a) Each employer in Colorado shall participate in the e-verify program for the purpose of verifying the work eligibility status of each of the employer's newly hired employees by the following dates: (I) For an employer with two hundred or more employees, no later than January 1, 2010; (II) For an employer with at least fifty employees but fewer than two hundred employees, no later than July 1, 2010; and (III) For an employer with fewer than fifty employees, no later than July 1, 2012. (b) An employer shall enter into an agreement as required by the social security administration and the United States department of homeland security to participate in the e-verify program and shall comply with the requirements for participating in the program. If the agreement is terminated by the social security administration or the United States department of homeland security based on the employer's failure to comply with the established procedures or legal requirements as set forth in the agreement, the employer shall be subject to the penalties set forth in paragraph (d) of this subsection (4). (c) Upon entering the agreement described in paragraph (b) of this subsection (4), the employer shall maintain a copy of the agreement, showing that the employer is an active participant in the program, and shall notify its employees that it is participating in the program. (d) If the attorney general finds that an employer has failed to participate in the e-verify program as required by this subsection (4), the employer shall be subject to the following penalties for each thirty-day period of noncompliance: (I) At least five thousand dollars but not more than ten thousand dollars if the employer has two hundred or more employees; (II) At least three thousand dollars but not more than five thousand dollars if the employer has at least fifty employees but fewer than two hundred employees; or (III) At least one thousand dollars but not more than three thousand dollars if the employer has fewer than fifty employees. (e) The attorney general shall verify that each employer has complied with paragraph (a) of this subsection (4) within ninety days after the first finding of noncompliance. If the employer is not in compliance, the attorney general shall fine the employer the maximum fine amount pursuant to paragraph (d) of this subsection (4). (f) Upon request of the attorney general, an employer shall submit evidence that the employer is participating in the e-verify program, including a copy of the agreement executed by the employer with the social security administration and the United States department of homeland security. Upon receipt of two complaints that an employer has not complied with this subsection (4), the attorney general shall request the submission of such evidence within thirty days after the second complaint. The attorney general shall levy a fine against an employer pursuant to paragraph (d) of this subsection (4) for each calendar month the employer fails to submit such evidence. (5) On and after the date by which an employer is required to participate in the e-verify program pursuant to subsection (4) of this section: (a) An employer shall not intentionally or knowingly employ an unauthorized alien; and (b) An employer shall immediately terminate the employment of an employee for whom the employer receives a final notice of nonconfirmation of work eligibility through the e-verify program. (6) (a) Any person may file a complaint alleging that an employer intentionally or knowingly employs an unauthorized alien. The complaint shall be filed either with the attorney general or the county or city attorney for the county or city in which the employer allegedly employs an unauthorized alien. Upon receipt of a complaint that an employer intentionally or knowingly employs an unauthorized alien, the attorney general or county or city attorney, as appropriate, shall investigate whether the employer has violated subsection (5) of this section. As part of the investigation, the attorney general or county or city attorney shall verify the work authorization of the alleged unauthorized alien with the federal government pursuant to 8 U.S.C. sec. 1373 (c). A state, county, or city official shall not attempt to independently make a final determination on whether an alien is authorized to work in the United States. A person who knowingly files a false or frivolous complaint under this subsection (6) is guilty of a class 3 misdemeanor. (b) If, after an investigation, the attorney general or county or city attorney determines that the complaint is not frivolous, the attorney general or county or city attorney shall notify the United States immigration and customs enforcement and local law enforcement of the substance of the complaint, including the identity of the unauthorized alien if known. If the complaint was filed with and investigated by the attorney general, the attorney general shall notify the appropriate county or city attorney to bring an action against the employer pursuant to subsection (7) of this section. (7) (a) The county attorney of the county, or the city attorney of the city, in which the unauthorized alien is or has been employed shall bring an action against the employer for a violation of subsection (5) of this section. An action shall not be brought against an employer for a violation of subsection (5) of this section before the date by which the employer is obligated to participate in the e-verify program pursuant to subsection (4) of this section. The court in which the action is filed shall expedite the action and shall set the matter for hearing at the earliest practicable date, but no later than ninety days after the action is filed. (b) (I) If the court finds that the employer knowingly violated subsection (5) of this section and it is the employer's first knowing violation within a three-year period, the court shall order the employer to: (A) Terminate the employment of all unauthorized aliens; (B) Be subject to a three-year probationary period, during which the employer shall file quarterly reports with the appropriate county or city attorney specifying each new employee hired by the employer at the specific location where the unauthorized alien performed work and the work eligibility status of each new employee; and (C) File a signed, sworn affidavit with the county or city attorney within three business days after the order is issued, attesting that the employer has terminated the employment of all unauthorized aliens and that the employer will not knowingly or intentionally employ an unauthorized alien. If the employer fails to timely file the affidavit, the court shall order the appropriate agencies to suspend all business licenses held by the employer until the employer files the affidavit. Upon notice from the county or city attorney that the employer has filed the affidavit, the appropriate agencies shall immediately reinstate all suspended business licenses. (II) In addition, the court may order the appropriate agencies to suspend all business licenses held by the employer for up to ten business days. In determining whether to order the suspension of the employer's business licenses, the court shall base its decision on any evidence or information it receives during the action and shall consider the following factors, if relevant: (A) The number of unauthorized aliens employed by the employer; (B) Any prior misconduct of the employer; (C) The degree of harm resulting from the violation; (D) Whether the employer made good-faith efforts to comply with the law; (E) The duration of the violation; (F) The role of the directors, officers, or principals of the employer in the commission of the violation; and (G) Any other factors deemed appropriate by the court. (III) In determining whether to suspend an employer's business licenses pursuant to subparagraph (II) of this paragraph (b), the court shall not consider the potential financial hardship that may be imposed on the employer if its business licenses are suspended. (c) If the court finds that the employer intentionally violated subsection (5) of this section and it is the employer's first intentional violation within a five-year period, the court shall order: (I) The employer to terminate the employment of all unauthorized aliens; (II) The employer to be subject to a five-year probationary period, during which the employer shall file quarterly reports with the appropriate county or city attorney specifying each new employee hired by the employer at the specific location where the unauthorized alien performed work and the work eligibility status of each new employee; (III) The employer to file a signed, sworn affidavit with the county or city attorney, attesting that the employer has terminated the employment of all unauthorized aliens and that the employer will not knowingly or intentionally employ an unauthorized alien. If the employer fails to file the affidavit within the period in which the employer's business licenses are suspended pursuant to subparagraph (IV) of this paragraph (c), the employer's business licenses shall remain suspended until the employer files the affidavit. Upon notice from the county or city attorney that the employer has filed the affidavit, the appropriate agencies shall immediately reinstate all suspended business licenses. (IV) The appropriate agencies to suspend all business licenses held by the employer for at least ten business days. In determining the length of the business license suspension, the court shall base its decision on any evidence or information it receives during the action and shall consider the following factors, if relevant: (A) The number of unauthorized aliens employed by the employer; (B) Any prior misconduct of the employer; (C) The degree of harm resulting from the violation; (D) Whether the employer made good-faith efforts to comply with the law; (E) The duration of the violation; (F) The role of the directors, officers, or principals of the employer in the commission of the violation; and (G) Any other factors deemed appropriate by the court. (d) In determining the length of the business license suspension pursuant to subparagraph (IV) of paragraph (c) of this subsection (7), the court shall not consider the potential financial hardship that may be imposed on the employer based on the length of the business license suspension. (e) If, during a period of probation imposed by a court order issued pursuant to paragraph (b) or (c) of this subsection (7), the court finds that the employer has employed an unauthorized alien, the employer shall be found to have committed a second violation of subsection (5) of this section, and the court shall order the appropriate agencies to immediately and permanently revoke all business licenses held by the employer. (f) Upon the issuance of an order pursuant to this subsection (7), the court shall send a copy of the order to the attorney general. For purposes of orders directing the suspension of an employer's business licenses, a copy of the order shall be sent to all appropriate agencies. (g) In determining whether an employee is an unauthorized alien, the court shall consider only the federal government's determination pursuant to 8 U.S.C. sec. 1373 (c). The federal government's determination creates a rebuttable presumption of the employee's work eligibility status, and the court may take judicial notice of that determination. The court may request the federal government to provide automated or testimonial verification pursuant to 8 U.S.C. sec. 1373 (c). (h) Proof of verifying the work eligibility status of an employee through the e-verify program creates a rebuttable presumption that the employer did not intentionally or knowingly employ an unauthorized alien. (i) An employer that shows that it complied in good faith with the requirements of 8 U.S.C. sec. 1324b establishes an affirmative defense that the employer did not intentionally or knowingly employ an unauthorized alien. (8) The attorney general shall maintain copies of all court orders issued pursuant to subsection (7) of this section and shall make the court orders available on the attorney general's web site. Additionally, the attorney general shall maintain a database of the employers who have committed a first violation of subsection (5) of this section. (9) (a) On or before October 1, 2009, the department of revenue shall provide a notice to every employer that is required to withhold tax pursuant to section 39-22-604, C.R.S., explaining the requirements of this section. The department of labor and employment shall assist the department of revenue in developing the notice, which shall set forth at least the following information: (I) That a new state law prohibits an employer from intentionally or knowingly employing an unauthorized alien; (II) The penalties for violating the prohibition; (III) That employers will be required to verify the employment eligibility of new employees through the e-verify program; and (IV) Instructions for the employer on how to enroll in the e-verify program. (b) The departments of revenue and labor and employment and the attorney general shall maintain a copy of the notice required by this subsection (9) on their respective web sites. (10) Nothing in this section shall be construed to require an employer to take any action that the employer believes in good faith would violate federal or state law. (11) (a) There is hereby created in the state treasury the e-verify program cash fund, referred to in this section as the "fund". The fund shall consist of any moneys collected pursuant to subsection (4) of this section. Additionally, any unencumbered and unexpended moneys remaining in the employment verification cash fund, created in section 8-2-122 (4), as of the date section 8-2-122 is repealed, shall be transferred to the fund. Moneys remaining in the fund at the end of any fiscal year shall remain in the fund and shall not revert to the general fund. (b) Moneys in the fund shall be subject to appropriation by the general assembly to the department of law for the purpose of administering and enforcing this section and reimbursing county or city attorneys for their reasonable costs associated with enforcing this section. A county or city attorney that incurs costs associated with enforcing this section shall submit a request for reimbursement to the department of law at the end of the state fiscal year for costs incurred during that fiscal year. The department of law shall determine an equitable method of reimbursing county and city attorneys for their enforcement costs from available moneys in the fund. SECTION 2. 24-34-402, Colorado Revised Statutes, is amended BY THE ADDITION OF A NEW SUBSECTION to read: 24-34-402. Discriminatory or unfair employment practices. (8) Notwithstanding any other provision of this section to the contrary, it shall be a discriminatory or unfair employment practice for an employer to refuse to hire an otherwise qualified person, or to discharge an employee, who is a United States citizen or permanent resident alien while hiring a person or retaining an employee who the employer knows or reasonably should have known is an unauthorized alien, as defined in section 8-2-125, C.R.S., hired after the date by which the employer is required to participate in the federal e-verify program pursuant to section 8-2-125 (4) (a), C.R.S., if the unauthorized alien is working in a job category that requires equal skill, effort, and responsibility and under similar working conditions, as defined in 29 U.S.C. sec. 206 (d) (1), as the job category sought by the person who was not hired or held by the discharged employee. For purposes of this subsection (8), an employer may show that it did not know or should not reasonably have known that it employed an unauthorized alien if the employer provides evidence that it verified the unauthorized alien's work eligibility status through the e-verify program, as defined in section 8-2-125, C.R.S. SECTION 3. Repeal. 8-2-122, Colorado Revised Statutes, is repealed. SECTION 4. Applicability. Section 2 of this act shall apply to discriminatory or unfair employment practices committed on or after the effective date of this act. SECTION 5. Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.