Interior Contractors Incorporated (ICI), under investigation by the Colorado Department of Labor and Employment (CDLE) for unscrupulous business practices including wage fraud and worker misclassification, is using the controversial H-2B nonimmigrant visa program to hire workers for their CO job sites. Many, however, believe that the program is broken and is used as a ploy to cover exploitative and abusive hiring practices. An anonymous worker who was previously employed by ICI told BDN that he has observed firsthand the influx of foreign workers hired by ICI through the program on a state funded school project. “I believe ICI is taking advantage of this program to exploit Latinos by paying them less than local workers, stealing their wages, and putting them in a position where they have no choice but to work for this contractor,” said the worker. “It’s not fair, it’s not right, and in my opinion, it’s criminal.” One ICI project that is using “20 to 40 nonimmigrant” H-2B workers hired by ICI, according to our anonymous sources, is the Centennial High School in Pueblo. And the citizens of Colorado are paying for it through a $218 million dollar bond approved in 2019. When the bond was approved, residents could celebrate new employment opportunities and the potential for money being reinvested into the community. But now, three years later, taxpayer dollars are being used to cover the cost of a foreign workforce.
The downside of H-2B
In 2020 a group of senators including Diane Feinstein, Tom Cotton, and Chuck Grassley, wrote an open letter to the US DOL condemning the system. “H-2B workers are often at the mercy of their employers, which means they may be afraid to speak out against poor working conditions. Even when they do speak out, they can struggle to access our justice system to protect themselves from retaliation by their employers. This creates a perverse incentive for unscrupulous employers to hire H-2B workers instead of American workers” The H-2B program allows employers to recruit temporary nonimmigrant labor for jobs in the United States. According to a U.S. Department of Labor fact sheet, H-2B workers can only be hired “if unemployed persons capable of performing such service or labor cannot be found in this country.” The program was intended as a means to offset labor shortages during times of extreme need. The Covid-19 pandemic has initiated a rush of visa applications in the construction industry and across many others. However, there are numerous issues inherent to the program. For starters, it is to be implemented when there are labor shortages, and the baseline for what constitutes a labor shortage can be largely subjective and manipulated. For example, throughout the pandemic, there has been a narrative that workers are quitting en masse and/or not returning to jobs that were strained by covid-19 protocols. But in many cases, the truth is that low pay and lack of benefits have created the labor shortage. In states such as Colorado, where ICI operates, unemployment rates are very high meaning that workers are available, and that the pool of unemployed workers is being purposefully circumvented. An Economic Policy Institute (EPI) report from 2021 noted that the industries with the highest H-2B application numbers (construction being at the top) simultaneously had the highest unemployment rates and joblessness rates. “The recruitment requirements for H-2B remain minimal, enforcement is lax, and therefore employers can still easily game the system with impunity," according to the report. The EPI report goes on to say, "a request to increase the number of H-2B visas is odd, to say the least, considering the current state of the labor market in major H-2B industries, all of which are seeing high levels of unemployment and joblessness."
This is not how the system is supposed to work. Foreign workers are not meant to be utilized to this magnitude when there is a pool of unemployed US workers to draw from. Therefore, according to the EPI report, it can be inferred that the system is easily manipulated by employers with ulterior motives. According to a CDLE "notice of investigation" sent to Interior Contractors Inc., there is, "a credible allegation or suggestion of a systemic violation of Colorado labor law," within ICI. The violations under scrutiny concern: worker misclassification, failure to pay all earned wages, and denial of itemized pay statements and notices of rights. Although ICI is being investigated for unscrupulous practices amongst stateside workers, offenses like these are even easier to hide amongst H-2B workers. The H-2B program enables construction companies to exert an inordinate amount of control over the workers. The workers often arrive indebted to labor brokers with their visa statuses under strict control by their employers. Under these conditions, workers are in constant fear of being fired and deported. This leaves the door wide open for exploitation. Employers can pay lower wages, deny overtime and promote cheap and dangerous working conditions with no repercussions.
According to critics, companies apply for the H-2B program as an opportunity to depress wages and withhold benefits. The foreign workers are unable to stand up for themselves and document the injustice they suffer on job sites for fear of retaliation. In the specific case of ICI hiring foreign workers for their taxpayer-funded Centennial High School project, ICI is getting workers at a lower rate, improving their profit margin, while taxpayer money leaves the state, all while H-2B workers are allegedly exploited in what is akin to indentured servitude. It remains to be seen how the CDLE investigation into ICI will affect their business prospects moving forward, and whether they will exploit H-2B workers using the same wage fraud and worker misclassification tactics. However, taxpayers should know what they are inadvertently funding. Interior Contractors Inc. did not respond to requests for comment at the time of writing.