Preparing for Immigration Raids

7-Eleven raid a ‘first of many,' with more ‘large-scale compliance inspections’ likely

In early January, U.S. Immigration and Customs Enforcement (ICE) agents served nearly 100 7-Eleven c-stores with surprise employment audits and investigations. It was the largest operation against an employer so far under Donald Trump’s presidency, and it was designed to make a statement.

“[January’s] actions send a strong message to U.S. businesses that hire and employ an illegal workforce: ICE will enforce the law, and if you are found to be breaking the law, you will be held accountable,” ICE Deputy Director Thomas Homan said. The raids were “to be the first of many” targeted at employers, Derek Benner, acting head of ICE’s Homeland Security Investigations (HSI), told The Associated Press.

“This is what we’re gearing up for this year, and what you’re going to see more and more of is these large-scale compliance inspections, just for starters,” Benner said. “From there, we will look at whether these cases warrant an administrative posture or criminal investigation.”

Special agents of HSI served notices of inspection—also known as I-9 audit notices, used for verifying the identity and employment authorization of individuals hired in the United States—to 98 7-Eleven franchise stores in 17 states before dawn on Jan. 10.

Agents arrested 21 people suspected of being in the country illegally, but the action was primarily aimed at management, according to reports; most or all store franchisees were served notices to produce hiring records.

ICE said the sweep was a broadening of a 2013 investigation in New York and Virginia under the Obama administration that led to indictments against nine men and women for conspiring to commit wire fraud, stealing identities and concealing and harboring undocumented immigrants employed at 7-Eleven franchise stores. All but one of the defendants—who remained a fugitive until his arrest in November 2017—pleaded guilty and were ordered to pay more than $2.6 million in restitution for back wages stolen from workers. Neither Irving, Texas-based 7-Eleven Inc. (SEI), which has more than 8,300 c-stores in the United States, nor its parent company, Tokyo-based Seven & i Holdings Co. Ltd., were charged in the case.

ICE said the new round of notices were a follow-up to ensure “the company has taken the proper steps toward more responsible hiring and employment practices.”

“Businesses that hire illegal workers are a pull factor for illegal immigration, and we are working hard to remove this magnet,” said Homan. “ICE will continue its eff orts to protect jobs for American workers by eliminating unfair competitive advantages for companies that exploit illegal immigration.”

In response to the raids, 7-Eleven Inc. said, “7-Eleven franchisees are independent business owners and are solely responsible for their employees, including deciding who to hire and verifying their eligibility to work in the United States. This means that all store associates in a franchised store are employees of the franchisee and not 7-Eleven Inc.”

This falls in line with a December 2017 ruling by the National Labor Relations Board to reverse a 2015 decision that had broadened the “joint employer standard,” making a franchisor or contractor liable for the policies of a franchisee or subcontractor. With the reversal, a company is considered a joint employer only if it exercises “direct” control (i.e., decisions about hiring, firing, supervision and wages) of the employees in another business.

7-Eleven also said it “takes compliance with immigration laws seriously and has terminated the franchise agreements of franchisees convicted of violating these laws.”

The response didn’t sit well with one franchisee retailer, who spoke to CSP on the condition of anonymity.

“I was disgusted … because instead of providing help, SEI threw their franchisees under the bus by responding to this raid and stating that franchisees are independent business owners and they bear all responsibilities for their stores,” the franchisee said. “Difficult times reveal real friends and it is now clear that SEI is no friend of the franchisees.”

7-Eleven’s relationship with some of its franchisees has been strained lately. In October 2017, a 7-Eleven franchisee group filed a lawsuit accusing the franchisor of “chipping away at their profits, increasing their costs and exercising more control over what is supposed to be an independent operation.”

And that following November, the presidents of all 43 7-Eleven franchise owners associations,  which represent the interests of nearly 7,000 franchised U.S. c-store locations, voted unanimously not to attend 7-Eleven’s annual convention and trade show, held in February in Las Vegas.

The 7-Eleven raids came just one day after Trump met with lawmakers from both parties to negotiate a compromise toward immigration reform. Trump appeared to offer a softer view on the subject during that meeting, but the raids may have been intended as a display of strength on the issue.

“If ICE hoped to make a bold statement, it could hardly pick a more iconic target than 7-Eleven,” The New York Times said.

How Retailers Can Prepare for Potential Raids

While ICE officials have said they have no quota to fill, they warned that more employment audits and investigations are imminent. “It’s not going to be limited to large companies or any particular industry, big medium and small,” ICE official Derek Benner said.

Here’s how retailers can prepare for raids:

Double-Check I-9 Forms.

Michael Lied, an attorney and counselor for Howard & Howard in Peoria, Ill., says retailers should first look through their I-9 forms, which are used for verifying the identity and employment authorization of individuals hired in the United States. “Even if every team member is hired legally, incorrectly filled-out I-9 forms could still cost c-store owners,” Lied says. “It could cost them $200 to $2,000 per one form.”

If there are errors on the forms, Lied recommends retailers make and initial any corrections to show officials good faith. Electronically verifying legal employment with E-Verify also helps protect employers.

Create An Action Plan.

To help ensure employees are not caught off guard by an ICE visit, retailers should create a worksite enforcement action plan, says Alisa Nickel Ehrlich, partner with Stinson Leonard Street LLP, Wichita, Kan. It should include a phone tree of who to call and a reminder for employees to ask to see identification and review any warrants.

And retailers don’t have to come up with a plan on their own; they can consult with an immigration attorney.

Help Staff Create A Family Preparedness Plan.

Such a plan helps streamline communication between workers and their families and lawyers in the event of their arrest. It compiles contact information, health information, child or elder care plans and important documents so that dependents are not abandoned during a possible retention. If employees do have medical or child care needs, retailers should communicate the needs to the immigration officers, Nickel Ehrlich says.

“Don’t forget about the well-being of employees,” she says.