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Fears stack up

The gritty work of nailing together cargo pallets falls mostly to immigrants, and recent raids concern company owners.

By ASSOCIATED PRESS
Published May 24, 2006

You could call it a forgotten industry - except most people never knew this sawdust-covered corner of the economy existed.

At least not until late last month when federal agents focused uninvited scrutiny on the obscure business of wooden cargo pallets, arresting nearly 1,200 employees of supplier IFCO Systems in the single largest immigration bust. For a trade that used to being overlooked - its workers do the unglamorous but essential job of pounding together the wooden waffles used to forklift everything from mangoes to machines - it was hardly the ideal way to gain the spotlight.

But as the nation wrestles with the quandary of illegal immigration, the raids on more than 40 IFCO plants from Southern California to upstate New York have made it clear to folks in this gritty business that they, too, have a critical and surprisingly difficult-to-hedge stake in the outcome.

In much the same way that the broad immigration debate is defined by conflicting interests and consequences, the IFCO crackdown is proving an unexpectedly double-edged buzz saw for the thousands of mom-and-pops who fill this gritty niche business. It's immigration economics on a smaller scale.

"It's a real concern in this industry what's going to happen to the immigrants because they are so widely employed," says Ed Brindley, who runs Pallet Enterprise, a trade magazine. "I know most of the pallet people. And most of them consider labor to be their biggest problem."

In an industry of little guys, IFCO is one of the only big players.

So the government's raids made many much smaller business owners cringe. At the same time, seeing a company widely reviled as an industry bully and brutal competitor taken down a notch has turned some of them near giddy.

"It couldn't happen to a nicer guy," says Monte Lowe, owner of Preferred Pallets in Cookeville, Tenn., describing his initial reaction to reports of the raids on IFCO. "Everyone I spoke with pretty much said that."

But at some pallet shops, that elation is undermined by serious doubt. That's because the raids look to many like a reversal of several years in which the federal government engaged in minimal work site enforcement of immigration laws.

In 1999, the federal government notified 417 employers of its intent to impose fines for immigration law violations. But such notices dropped to just three in 2004, according to a report on immigration enforcement last year by the Government Accountability Office. Work site arrests fell sharply, from 2,849 in fiscal year 1999 to 445 in fiscal year 2003.

More recently, work site arrests climbed to 845 in fiscal year 2004 and 1,045 last year, according to U.S. Immigrations and Customs Enforcement.

It's unclear to what extent the raids point to a sustained increase in enforcement. But immigration officials have hardly put minds at ease, saying they plan more such arrests.

"It certainly does kind of upset the apple cart. It spooks people. It spooks employers," said Marshall Fitz of the American Immigration Lawyers Association. "Everyone is kind of stretching their necks out to see what's around the corner."

A spokesman for U.S. Immigration and Customs Enforcement acknowledged past figures showed declining enforcement. But he said they also point to a change in the agency's strategy, moving away from fines and instead filing criminal charges against employers.

"We are rebuilding the program and (enforcement actions) are beginning to go back up," said Dean Boyd, the spokesman for the agency. "Certainly, we've got a lot of work to do, but we're taking a different approach."

Immigration lawyers and businesses, including the pallet companies, say they hope any stepped-up enforcement will focus on the most egregious violators. IFCO is accused not just of hiring illegal workers, but of recruiting and harboring them.

But in an industry that leans heavily on immigrant labor, the folks who sell pallets have begun to wonder: Does this mean they could be next under the microscope?

"This business is my life and I'm not going to risk this for anything," said Steve Mazza, owner of S&B Pallet Co. in Plainfield, N.J. "It raises my level of concern. It has made me go out and restate to my employees here, 'Hey, make sure you've got your I-9s. Make sure you've got your Social Security cards and green cards and make sure we're following the letter of the law.' "

[Last modified May 24, 2006, 05:53:12]