Merrick Garland's DOJ Supports Firms Violating Labor Laws
The Biden administration's Department of Justice (DOJ) last month filed an historic amicus brief supporting private prisons paying $1 a day for labor to folks who are in custody under immigration laws, legally or otherwise, including U.S. citizens. The filing means DOJ is taking the side of federal contractors found to have violated state and federal labor laws and disregarding rulings by state and federal judges, including Reagan-appointee Judge Robert Bryan in Tacoma, Washington.
DOJ's filing of February 21, 2024 assists GEO in appealing a 2021 federal jury's award to its Tacoma detained workers of $17.3 million in backpay and an additional $5.9 million in "unjust enrichment" Judge Bryan ordered GEO to disgorge to the State of Washington. (In 2022, GEO was ordered to pay an additional $14.3 million in attorney fees.)
The DOJ's undermotivated gift to scofflaw GEO Corporation and other defendants also contravenes findings and analyses of federal agencies, including those operating under President Donald Trump, when Immigration and Customs Enforcement (ICE) rebuffed GEO's entreaties to assist and reimburse GEO for its defense.
Attorney General Merrick Garland's DOJ is asking courts to support a private corporation paying recently arrived migrants, as well as long-term legal residents and U.S. citizens, one dollar a day for work to meet the firm's contractual commitments to the federal government, instead of the legally mandated wages of the Service Contract Act. (The recent ploy to evade wage acts is in keeping with the Biden administration's bizarre contract language from 2021.)
And yes, the filing means the U.S. government is on record supporting paying U.S. citizens one dollar/day. Indeed, it was U.S. citizen Mark Lyttle's 2009 efforts
to recoup the $32 owed him by Corrections Corporation of American (now
CoreCivic) that first put the practice on my radar. Thousands of pages I obtained through
litigation under the Freedom of Information Act, and reported on by the New York Times in 2014, proved the program was both unlawful and widespread, as was forcing those detained under immigration laws to work for no wages at all, again, regardless of their actual legal status or the fact the firms were obligated by federal acquisition rules, not to mention federal labor laws.)
Background
Congress in 1950, to come into compliance with the Geneva Convention for Prisoners of War, passed a law authorizing federal immigration centers, then mostly non-carceral residential facilities such as Ellis Island, to pay people an allowance for work performed, "at such rate as may be specified from time to time in the appropriation
Act involved." Shortly after the policy was enacted, Ellis Island closed and there was no long-term detention for people in immigration proceedings until 1981.
The last time Congress set the work program rate was in 1978. The rate was no more than $1/day, in an appropriation Act that expired on September 30, 1979. (GEO and DOJ briefs misstate the year of enactment as 1979.)
People in ICE custody are there to guarantee they do not flee prior to their hearings or removal from the United States, not as punishment. The work programs wardens use for people held in criminal custody is a punitive measure; paying people in civil custody one dollar/day is no more lawful than paying elderly citizens one dollar/day to cook, clean, or buff floors in an assisted living facility. And tons of case law applies minimum wage protections to those who lack federal authorization to work, a means of maintaining a fair labor market and not undercutting legal wages.
In addition, people in criminal custody are there pursuant to Sixth Amendment protections absent for those ICE custody -- hence the large numbers of U.S. citizens and others with lawful status ICE and often immigration "judges" (DOJ attorneys in black robes) miss. (Briefing on both sides often omits this crucial distinction, important for differentiating ICE custody from pre- and post-conviction criminal custody.) This is why the Supreme Court in 1896 ruled forced labor unconstitutional for those held under immigration laws.
The Rule of Law Applies to GEO and ICE
Here's how Federal District Court Judge Robert Bryan, a Reagan appointee, explained GEO's obligations to adhere to wage laws and rejected GEO's whining about discrimination:
The MWA [Washington Minimum Wage Act] is a neutral law of general application and is being imposed on GEO on a “basis unrelated to [GEO’s] status as a Government contractor.” North Dakota, v. U.S., 495 U.S.
6 423, 438 (1990). The MWA is imposed generally on employers in Washington, unrelated to a status as a contractor with federal governmental entities. Indeed, the federal government and GEO contemplated (or should have contemplated) application of the MWA in their contracts. The 2009 Contract and 2015 Contract between GEO and the federal government require that GEO comply with all “applicable federal, state and local labor laws.” [Cit. omitted] Those contracts further provide that “[s]hould a conflict exist between any of these standards, the most stringent shall apply.”
In other words, GEO's business of holding people while their civil immigration or citizenship claims are adjudicated provides the firm no more legal authority to violate labor laws than it would for any other employer or federal contractor that might assert it should be exempt from violating the state's labor laws.
The fact that those employed are allegedly not authorized for legal employment is irrelevant to MWA. And again, many of those detained have work authorization.
(Bonus trivia: One of the lead lawyers for the state attorney general was Jamal Whitehead, appointed by President Biden in 2023 to serve as a federal circuit judge in the same courthouse where he beat GEO.)
Behind the Scenes - GEO/ICE 2018-20
As lawsuits against the private prisons proceeded across the country, and federal judges slapped down their motions to dismiss, the firms ran to ICE requesting backup. With one exception, ICE turned them down.
In related litigation, the
Solicitor General filed a brief in support of neither party and affirming that the Georgia
facility that exploited Mark Lyttle was indeed was covered by the
Trafficking Victims Protection Act. The Eleventh Circuit denied CoreCivic's motion to dismiss and also class certification. CoreCivic and plaintiffs settled in November, 2023.
In 2018, GEO directly and through Congressional minions attempted to pressure the U.S. Government to file briefs supporting GEO's slaving wages and to pay for GEO's litigation fees.
In February, 2018, GEO wrote to ICE about the Aurora, Colorado litigation:
The legal discovery costs could total several millions of dollars and potential damages could be in the tens of millions. Understandably, GEO would need to be reimbursed for all of the costs through an equitable adjustment request to ICE. To date, GEO has expended $1,615,000 in legal costs for which we seek an equitable adjustment.
By May GEO asks ICE fork up to $20 million of taxpayer money to pay GEO's legal fees. In the same letter, GEO's CEO and Chair George Zoley also begs DOJ to defend GEO: "We urgently implore DOJ to take over the defense of these lawsuits and reimburse GEO for its costs and claims damages."
ICE and DOJ rebuff GEO. On June 21, 2018 ICE denied all of Zoley's requests for contract adjustments and refused to defend the private prisons. First, ICE pointed out there was no change in the conditions stated in the contract:
This is a firm-fixed price performance-based contract. As such, the risk of performance, including the burden of administering the contract, falls to the contractor. Where there is no change to the contract, whether expressly or constructively, an equitable adjustment is not appropriate.
Second, ICE noted the contract clearly stated that ICE would be reimbursing GEO at one dollar/day, and did not state GEO was obligated to pay only one dollar/day:
Furthermore the award document and contract line item structure set forth the rate of reimbursement for the program. (OF 336, CLIN x004, dated September 15, 2011). Accordingly, the service provider has been on notice about these terms since contract inception, when the performance based contract was negotiated. [Emphasis added.]
Third, ICE's contracting officer in 2018 anticipates a key factor in plaintiff's lawsuit and the Judge Bryan's orders: the contract obligates GEO to all relevant legal standards, not cherry-picked protocols and long-standing unlawful practices the plaintiffs were challenging:
Under the terms of the contract, GEO is required to provide detention
services and ensure compliance with all applicable federal, state, and local work safety laws and regulations. (Contract, Section 11-5 and H-17). GEO's defense of these private lawsuits is a defense of its contract performance.
The applicable work safety laws and regulations in question are those of Washington State.
That said, despite ICE's own findings, by August, 2018 an ICE Deputy Chief of the Litigation Division tried to push DOJ to file a "Statement of Interest" in support of GEO's unlawful exploitation:
...As you may remember [REDACTED] previously forwarded requests from ICE to DOJ to file statements of interest in six federal district court cases to inform the courts of significant government interest in cases involving novel issues.
The need to file statements of government interests continues to become more pressing. Since those prior requests were submitted in October 2017 and January 2018, two more related lawsuits have been filed, and ICE has significant concerns about the potential impact on ICE equities if adverse decisions are entered in these cases. I am attaching a request from our Acting Principal Legal Advisor for DOJ to to file statements of interest in these two additional lawsuits.
Under Attorney General Jeffrey Sessions and Matthew Whitaker, DOJ did not honor the request.
2019 - First Shoddy DOJ "Statement of Interest"
AG Bill Barr's DOJ in August 2019 did sign a Statement of Interest, but only in the Tacoma case, above the signatures of DOJ Trial Attorney Christopher J. Lynch, along with AUSA Joseph H. Hunt, Principal Deputy Assistant Attorney Ethan P. Davis, Senior Counsel to the AUSA Christopher A. Bates, Director [DOJ Federal Programs Branch] Alexander K. Haas, Assistant Branch Director Jacqueline Coleman Snead.
The
2019 DOJ brief states, "Although the GEO Group’s contract with ICE
specifies that the federal government will pay GEO $1 a day for work
performed by detainees, Washington wants GEO to pay much more." Yes, as
ICE told GEO, the $1/day reimbursement was not a cap on GEO's wages for
those in custody.
The brief reiterated arguments made by GEO and previously rejected by Judge Bryan, not to mention ICE itself. (In 2014, ICE officials stated in internal emails that the 1978 appropriations Act provided no legal basis for its contractors' exploitative practices.)
The central arguments are:
(1) enforcing state laws against GEO is discriminatory, insofar as Washington does not apply its minimum wage laws to those in state custody under civil laws;
(2) that federal contractors are immune from state laws; and
(3) federal enforcement of immigration law pre-empts the state's authority to enforce its minimum wage law.
Washington is Discriminating against GEO, GEO/DOJ Assert
Most of the 2019 brief is devoted to the argument that by enforcing a minimum wage act claim against GEO and not the state's own work program, Washington is unlawfully discriminating against a federal contractor and hence against the federal government:
By requiring federal detention contractors to pay the minimum wage but relieving similarly-situated state facilities from that obligation, the State accordingly runs afoul of basic principles of intergovernmental immunity that have shielded federal activities from state interference since the Founding. p. 6.
In addition to the claim of intergovernmental immunity, the DOJ in a footnote arguments that the litigation is not only discriminating against the federal government, but also interfering with the federal government's sovereign authority over handling immigration policy, and thus the action is barred by the the doctrine of preemption.
The brief is truly terrible, as though drafted by a GEO attorney. The key case on which DOJ/GEO relies involves a dispute between the Department of Defense and the North Dakota over the rules for alcohol sales. DOJ/GEO argue that just as the Supreme Court recognized the supremacy of DOD's prerogative to set the rules for alcohol sales on military bases that conflict with state policies, ICE/GEO have the prerogative to set the wages for people in custody under immigration laws.
The crucial difference DOJ at no point acknowledges: the disputed federal policy on alcohol sales was operationalized per a law Congress passed and pursuant regulations DOD implemented. ICE/GEO can point to no current Congressional authority for GEO paying anyone less than either the federal or state minimum wage laws.
In fact, the DOD relies on scores of federal laws that legalize exemptions from hundreds if not thousands of federal, state, and local statutes, from labor to environmental laws. Congress could pass bills that accomplish the policy objectives GEO and some in ICE -- those counting on the golden revolving door into a lucrative GEO position? -- prefer. Congress could pass laws exempting from remedies under our minimum wage laws those without legal authority to reside or work in the United States. And likewise for health and safety labor protections. But since Congress has not done so -- and indeed the House Appropriations Committee twice passed requirements to fund the program at wages of the Service Contract Act, the authorities DOJ/GEO is citing for its intergovernmental immunity argument are just losers.
Among the legal and also policy reasons even a Republican-led Congress is unlikely to pass legislation that would accomplish the objectives GEO-ICE-DOJ are pursuing is that many of those participating in the work programs have legal authorization to work in the United States, including because they are U.S. citizens. Moreover, even die-hard conservatives should be reluctant to pile on more profits to contractors who can easily afford to pay legal wages from their currrent taxpayer revenues.
It is obvious from some contracts that GEO is promising ICE it will be hiring people from the community to perform contractually obligated work but then boosting corporate profits by paying one dollar/day to those in GEO's custody. Financial data revealed during the trial but typically concealed show that the $37.5 million GEO was ordered to pay for back wages, unjust enrichment, and plaintiff attorney fees still leaves GEO able to pay wages from its bloated government fees.
GEO's own records obtained from information obtained from FOIA requests and court release make this clear. First, GEO in 2018 estimated that it would cost $155 million to pay minimum wage daily to people nationwide who were performing work while in ICE custody, assuming 33,000 detained each night.
Second, GEO's claimed net profits* for the Tacoma facility alone were:
2010: $13,204,102
2011: $15,214,358
2012: $9,697,371
2013: $10,788,018
2014: $5,901,703
2015: $11,663,530
2016: $10,575,188
*These figures reflect annual net revenues after paying millions for the bloated salaries of GEO's Chairman George Zoley and others who were directing GEO's resources toward lobbying and rewarding ICE officials with cushy GEO jobs, including ICE's Dan Ragsdale, who made numerous statements during his trial testimony as a GEO employee he knew or should have known were contradicted by DOJ's and ICE's own analyses, and that Judge Bryan's orders effectively discredited.
By better oversight of GEO's Jail Services Cost Statements, ICE can keep costs down and insure the private firms follow federal, state, and local labor laws.
2024 Brief Convenient Oversight: Private Contractors Differ from Government Providers
Copious case law referenced and created by this litigation, establish that federal contractors simply by virtue of being federal contractors are not immune from state laws unless a federal law or constitutional precedent specifically establishes the immunity.
DOJ's 2024 amicus brief disregards these rulings, including the findings of a unanimous Washington State Supreme Court issued in late 2023.
The DOJ brief claims that appling the MWA to GEO's work program "contravene[s] principles of intergovernmental immunity by discriminating against the federal government’s detention operations." DOJ notes:“[A] state law discriminates against the Federal Government or its contractors if it ‘single[s them] out’ for less favorable ‘treatment.’” Washington, 596 U.S. at 839 (second alteration in original) (quoting Washington v. United States, 460 U.S. 536, 546 (1983)). Here, as discussed, Washington has exempted its own detention operations from the state minimum wage laws, excluding from the definition of “employee” “[a]ny resident, inmate, or patient of a state, county, or municipal correctional, detention, treatment or rehabilitative institution.” Wash. Rev. Code § 49.46.010(3)(k). Thus, when Washington operates labor programs within its own correctional or other detention facilities, participants are generally paid substantially less than the minimum wage. DOJ Amicus Brief (2024) p. 25.
This assertion disregards the commonsense precedent that upholds the plain text of the state's law exempting certain government-run programs from the wage act. Again, the text above directly contradicts the recent Washington Supreme Court ruling:
Quoting Calhoun [v. State, 146 Wn. App. 877, 886 (2008)], GEO argues detainee-workers are not employees in the ordinary sense of the word because the work they perform does not provide sufficient “indices of employment.” 146 Wn. App. at 886. Calhoun is unhelpful here. There, the court considered whether the pretrial detainee, who was in custody at a civil commitment center operated by the State, was an employee for purposes of the WLAD. The court specifically noted that the detainee would not be an employee under the MWA because he fell within the government-institutions exemption,
RCW 49.46.010(3)(k). Thus, while the court considered factors such as the
primary goal of the work the detainee performed to decide whether the detainee was an employee, that analysis does not aid the argument that the ordinary meaning or the MWA’s definition of “employee” excludes detained workers. Nwauzor v. The GEO Group, Inc., No 101786-3, Slip Opinion, Dec. 21, 2023.
ICE and CCA/CoreCivic Violated Federal Labor Laws
In short, DOJ in 2019 was pleading with the Tacoma federal court to let ICE do whatever it wants, wherever it wants, however it wants without being empowered by laws or even regulations.
When ICE tried to subvert federal labor contracting laws the Department of Labor pushed back. The DOL in 2015 demanded ICE rewrite its contract with CCA to include the wages and benefits mandated by the Service Contract Act.
U.S, Department of Labor WAGE AND HOUR DIVISION 230 N, First Ave Suite 402 Phoenix, AZ 85003
Transmitted via email
September 9, 2015
U.S. Department of Homeland Security Immigration and Customs Enforcement
RE: Service Contract Act Clauses and Stipulations Contract No.: DROIGSA-06-0002
Dear Madame,
As you are aware, it has come to the attention of the Department of Jabor (DOL) that the DHS ICE has issued a contract with CCA Tennessee in order to provide all housing, transportation, medical, guard services and food to federal inmates. The DOL has learned that the DHS ICE failed to include the Service Contact Act (SCA) or the Contract Work Hours aud Safety Standards Act (CWHSSA) clauses and stipulations.
The Service Contact Act requires that all contracts over $2,500 that are principally for the furnishing of services through the use of Service Employees to the United States, must include SCA provisions and the appropriate wage determination. Additionally, any contract over $100,000 must incorporate the CWHSSA stipulations as well.
The Department of Labor is requesting pursuant to 29 CFR 4.5(c) that the contract be modified retroactively to the start date of the contract to include CFR Part 4.6 and CFR Part 4.181 in its entirety.
Please advise Wage and Hour Investigations b(5)(6); (b)(7)(C) if your agency’s actions with regard to the ahove- referenced malter within by Friday, October 9, 2015. You may contact |(b)(6); (b)(7)(C) ht 602-407 5)(6), if you need further assistance.
Sincerely,
((b)(6); (b)(7)(C)
Phoenix District Director
2020-ICLI-00042 4734
DOL is telling ICE its protocols and contracts must abide by U.S. federal law. The real discrimination would be if somehow courts let one agency cut contracts with one industry that evaded federal, state, and labor laws without authorization from Congress, in this case taking the form of an updated statute reflecting the realities of the private detention industry, in contrast with the federal government operations in 1950, AND funding for any new work program.
DOJ Contravenes House Dems Appropriations Committee
The amicus brief also disregards the House Appropriations Committee Acts for fy2022 and fy2023. The Acts, passed under Democratic leadership, state at Sec. 221:
Not later than 180 days after the date of enactment of this Act, allowances to individuals held in custody under the immigration laws for work performed may not be less than the rates established under paragraph (1) of section 6703 of title 41, United States Code ["The Service Contract Act"]. (And see hearing repts. fy 2022 and fy 2023.)
In fact, the fy 2023 Act prohibited using even the small dollar/day contractor payments.
S EC . 221. (a) No Federal funds may be used for the purposes of section 6(d) of Public Law 81–626 (8 U.S.C. 18 1555(d)).
(b)
Subsection (a) shall not apply if the rate described such section for
work performed is not less than the rates established under paragraph
(1) of section 6703 22 of title 41, United States Code.
The
Acts were not passed in the final Congressional Appropriations Acts,
but nonetheless send a signal that today's Democrat Congressional
experts have a very different policy position on private prisons
exploiting detained labor than than propounded by AG Garland's DOJ.
Predatory Governance
Especially when many Dems are jumping
on the anti-immigrant scapegoating bandwagon, the notion that folks in
deportation proceedings should earn legal wages for their work cooking,
cleaning, doing laundry, and buffing floors on the midnight to 8 a.m.
shift (Mark's job at the Immigration and Customs Enforcement (ICE)
contracted facility in Lumpkin, Georgia) might seem a stretch. But the
alternative is far more irrational: a single industry able to exempt
itself from the minimum wage laws that protect labor and the labor
market from unscrupulous employers.
In addition to being unlawful on its face, ICE's self-authorized carve out from labor laws feeds massive profits into a taxpayer-funded lobbying machine, the outcome of which are policies that prioritize corporate welfare and not policies that reflect the needs of U.S. voters.
(In
2009, Congress's Homeland Security committee found private prisons
severely deficient in providing care, and more expensive, compared with
county jails. Yet somehow the House Appropriations Committee and then
Congress passed a mandatory detention that required massive new
contracts with private prisons and no new oversight.)
The Mercurial Merrick Garland
So why is Merrick Garland's DOJ now weighing in for a firm that revealed that in time frames covered by the litigaiton it made a whopping 36% gross profits and 16-19% net profits by not hiring people at lawful wages?
One possibility is that the DOJ wants to shore up its federalism arguments against Gov. Abbott's Texas policy. But the Trump AGs pressed the federalism litigation in California to overturn the state's ban on ICE privately run detention facilities, while not weighing in on state's prerogative to regulate their operations.
There is no policy or legal rationale preventing Garland from asserting federal supremacy when it comes to the insuring the federal government has authority over detention under immigration laws, AND insuring private prisons abide by state and federal labor laws, not to mention their federal contracts obligating this.
Another motive is the impact the employment law litigation is having on detention contract negotiations. Biden now is running on a tough on immigration platform. Toward this short-sighted end, he is seeking to stop the visuals of thousands of new arrivals. And for this, he needs detention, to keep folks locked up and off the streets, and also as deterrent.
Along these lines, Biden supported the House Appropriations Act bumping up ICE's budget; House Spreaker Mike Johnson is bragging that it will up detention beds from 34,000 to 44,000, even though there are no line items in the budget to indicate this (or the alleged defunding of NGOs, as NPR astutely reports).
During negotiations, private prison firms will be pushing back against labor law enforcement, as these cut into their profits. As a result of the handful of detention firms and the revolving door, ICE is unlikely to push back by insisting detention facilities operate at the same profit levels as other private firms, or even lower, as is often the case with monopsonies. (No one is forcing anyone to bid on a government contract; if the returns after paying legal wages are not high enough to hold investor interest, then GEO and others are free to go out of business and let the government handle its own detention services, free of grift.)
The correct legal response would be for Garland to tell ICE to reject the loser legal arguments from the private prisons. This would push Congress to reform our deportation policies and consider radically diminishing detention under immigration law, alongside opening our borders.
How to pay for this? That's the easy part: end corporate welfare and corrupt, bipartisan predatory governance. The magnitude of the taxpayer health and welfare funds going to corporations like Centene and enablers like insurance official Rep. Lauren Underwood (D-IL), both of which siphon funds from health care into their private coffers, could pay several times over for the needs of poor communities and newly arriving migrants who need resettlement. (More on budgets and predatory governance up next.)
Regardless of long-term goals and debates, the DOJ amicus brief is a pathetic reminder of how the Biden administration's role in furthering deficits of our democracy and the rule of law. If he wants to make amends, Garland should withdraw brief immediately and consider reprimands for those whose poor counsel and analyses produced it.
Thanks to Andrew Free and Nicolette Glazer for their legal representation in my FOIA litigation. Mr. Free also played a key role in strategizing the class action lawsuits across the country.
And many thanks to Deportation Research Clinic assistants for their careful analysis of the FOIA documents on which this post and my other publications rely: Addie Fleming, Caitlin Jimmar, Kendall McKay, Aimee Resnick, Gabriel Sanchez, and Julianna Zitron.
Please cite as: Jacqueline Stevens, "Biden Administration Backs GEO's Unlawful Labor Practices," States Without Nations blog, March 30, 2024, https://stateswithoutnations.blogspot.com/2024/03/biden-administration-backs-geos.html.
