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News: News Article - Court Decision Regarding Undocumented Workers

News Article - Court Decision Regarding Undocumented Workers

The United States Court of Appeals for the 11th Circuit, sitting in Georgia, recently issued an Order in a lawsuit by employees of a company that the employees claim have knowingly hired undocumented alien workers. In Williams v. Mohawk Industries, Inc., current and former hourly employees of Mohawk Industries, Inc. sued the company alleging that Mohawk knowingly employed illegal workers in an effort to lower labor costs by depressing wages for its legal hourly employees, all in violation of both federal and state RICO statutes. Mohawk filed a motion to have the lawsuit dismissed but on June 9, 2005, the Court of Appeals denied that motion.

Mohawk is the second largest carpet and rug manufacturer in the United States and it employs over 30,000 workers. The legal hourly workers who brought the suit alleged that Mohawk conspired with recruiters to hire illegal workers. For example, the legal employees claimed that Mohawk had agents travel to southwest border areas of the United States, such as Brownsville, Texas, to recruit undocumented workers, transport them to Mohawk facilities in northern Georgia where they were then employed by Mohawk. The employees alleged that Mohawk made incentive payments to such agents and recruiters for locating undocumented workers and that Mohawk knowingly accepted fraudulent documentation from the undocumented workers. They also claimed that Mohawk even concealed its efforts by assisting the undocumented workers in evading arrest by law enforcement.

The legal hourly workers claimed that the scheme allowed Mohawk to lower labor costs by reducing the number of legal workers it had to hire and thereby increasing the legal labor pool which, in turn, allowed Mohawk to pay those legal workers lower hourly wages.

The 11th Circuit stated its analysis by noting that under the Federal RICO statute (18 U.S.C. 1962 (c)), the Plaintiffs were required to prove four elements: 1) conduct; 2) an enterprise; 3) a pattern; and 4) racketeering activity. Because the Plaintiffs suit was civil in nature, the court said, they were also required to satisfy the requirements of 18 U.S.C. 1964 (c) that a person be "injured in his business or property by reason of" the RICO violation.

The Court first examined the easy issues - whether the Plaintiffs adequately alleged RICO's 3rd and 4th elements - a pattern of racketeering activity. The Court concluded that the Plaintiffs "easily" met their burden on these issues. The Plaintiffs alleged that Mohawk violated section 274 of the Immigration and Nationality Act which makes it a crime to knowingly hire 10 individuals when the employer knows those individuals do not have proper work authorization, to conceal or harbor aliens who illegally enter the United States and to encourage or induce an alien to illegally enter the United States. The Plaintiffs alleged that Mohawk engaged in all of these illegal activities "hundreds, even thousands" of times, something that, if proven, is a clear "pattern of racketeering activity."

The Court then addressed the issue of whether the Plaintiffs adequately alleged a "conduct of an enterprise" that had a common goal. The definitive factor in determining the existence of a RICO enterprise is whether there is an association of entities, however informal, that provides for an opportunity for the commission of at least two crimes. The Plaintiffs alleged that Mohawk and third party agencies conspired to violate federal immigration law, something the Court held to clearly be a legally sufficient allegation of a RICO enterprise. The common purpose element was satisfied by the Plaintiffs' allegations that each member of the enterprise allegedly reaped a large economic benefit from Mohawk's employment of illegal workers.

Finally, the Court examined whether the Plaintiffs satisfied the requirements of 1964 (c)--that is, whether they<

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