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Many people get away with employing illegal immigrants, paying them less and not paying taxes.
By HELEN HUNTLEY
© St. Petersburg Times, published January 10, 2001
In some ways, little has changed since Zoe Baird's nanny controversy cost her a chance to be U.S. attorney general eight years ago: People still hire maids and babysitters illegally and nobody is likely to notice unless the employer is nominated for a top political job.
Linda Chavez withdrew as President-elect George W. Bush's nominee for secretary of labor on Tuesday. She was under fire for providing housing and cash to an illegal immigrant who did chores in Chavez's home, although she denies she was paying for housework.
According to reports, Marta Mercado, an illegal immigrant from Guatemala, lived with Chavez from 1991 to 1993. Chavez also referred the immigrant to a neighbor who gave her a regular babysitting job.
Many people make such informal, though illegal, arrangements for household help, but nobody knows how many because the work and the payments go deliberately undocumented.
Hiring illegal aliens is a violation of immigration law. But even if the employees are U.S. citizens, failing to report their wages and to pay employment taxes is often a violation of federal and state tax laws.
Since the Zoe Baird controversy in 1993, when Baird admitted she broke the employment laws, the government has made it easier for household employers to report and pay employment taxes.
The taxes are now figured on a schedule filed with the employer's regular tax return and paid along with other income-tax payments or withholding. The IRS says 310,367 returns filed for 1997 included a tax schedule for household employees.
But the number of illegal employment arrangements can only be guessed at.
"I know for a fact that there are people working here in the Tampa Bay area cleaning houses that shouldn't be," said John Ovink, a Tampa lawyer who represents immigrants. "Construction, field work and house cleaning are the easiest jobs for illegal aliens to get."
He said most people probably do not realize that they are supposed to ask a newly hired babysitter or maid for proof of eligibility to work. And even those who know enough to ask might not be able to distinguish legitimate documents from fakes, he said.
"I don't think everyone knows there's an obligation there to make sure that person has legal papers," said Cheryl Little, director of the Florida Immigrant Advocacy Center in Miami. "To a large extent, it's an underground work force."
Working in someone's home is a job that allows an illegal alien to disappear from the Immigration and Naturalization Service, Little said. "You're not at a big factory where the INS can come in and conduct a raid," she said.
In fact, the INS hasn't had any cases involving household workers in the Tampa Bay area, said Jeff Wolder, INS supervisor in charge of investigations for the area.
"If people are working under the table doing housekeeping, that's very difficult to follow up on," he said. "We can't do anything unless we have some documentation that people are working, and you just don't hear about it until a public figure gets brought to task."
The immigrant advocacy center only learns of cases when an immigrant becomes a victim, Little said.
"They are afraid to complain to the police," she said. "They just feel completely helpless and with good reason. We had one case of a lady who was a virtual slave in somebody's home. She was working extraordinarily long hours for practically no pay and was terrified."
Most illegal aliens find jobs through friends, Ovink said.
"Good workers are hard to get," he said. "It's usually just word of mouth."
Eleanor Nesbit, owner of a Tampa nanny referral service, says parents looking for a nanny sometimes hire illegal aliens through referrals or newspaper ads.
"I think some people do it intentionally because of the salary range," she said. "A nanny who has citizenship can get $400 to $500 a week. Sometimes people can pick up an illegal person for $200 a week because they can't work anywhere else."
She said her company, A Choice Nanny, requires its nannies to prove their eligibility to work.
But Nesbit thinks that compliance with employment tax laws has improved dramatically since the Zoe Baird case.
"That first year a lot of nannies got huge raises to cover the taxes," she said. "I think the majority of our parents are paying legally. As the nannies get older they want the Social Security taken out."
St. Petersburg accountant Richard Beagles said many of his older clients pay taxes on household help, but younger ones rarely do.
"We ask the question, and I prepare returns based on information they provide," he said. "I'd like to say they all comply. Maybe older people are more likely to have domestic employees."
Some companies have sprung up specifically to handle the tax and paperwork involved with being a household employer.
"We've had very steady growth over the last 10 years," said Guy T. Maddalone, president of GTM Associates in Albany, N.Y. The company now has several thousand clients nationwide for its nanny payroll tax and paperwork business, he said.
GTM charges $75 to set up a client account and $8 to $10 a week to service it. That's not a lot, he said, when you consider that some nannies are making more than $1,000 a week in areas such as San Francisco.
In theory at least, people who hire household help illegally could face financial penalties.
Failing to document a worker's eligibility is a civil offense, although repeated infractions could lead to criminal charges, said Wolder at INS. A typical fine for a first offense involving one employee is $750 to $1,000. Harboring aliens to keep the INS from finding them is a crime, but one that's difficult to prove, he said.
Failure to pay employment taxes could result in IRS penalties and interest, should the omission be discovered.
But the issue only seems to surface in politics.
In Baird's case, it was the hiring of an illegal immigrant couple from Peru and the failure to pay employment taxes for them that led to her downfall. Household employment cases also cost two other would-be Clinton appointees their positions, U.S. District Judge Kimba Wood, a candidate for attorney general, and Bobby Ray Inman, nominee for defense secretary.
Others have managed to survive disclosures regarding their household help, including Christie Whitman, nominated to head the Environmental Protection Agency; the late Ron Brown, former commerce secretary; Federico Pena, former transportation secretary; and Sen. Dianne Feinstein, D-Calif.
Even Sen. Bob Graham, D-Fla., confessed during the Zoe Baird case that he had failed to pay employment taxes for a woman who cleaned his Capitol Hill townhouse. He paid the IRS $375 in taxes and penalties.
One of the ironies of the Chavez case is that she was among those publicly criticizing Baird in 1993.
"I think most of the American people were upset during the Zoe Baird nomination that she had hired an illegal alien. That was what upset them more than the fact that she did not pay Social Security taxes," Chavez said on MacNeil/Lehrer NewsHour.