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Monday, April 21, 2014

A question of preemption

Special to the Saipan Tribune

During the past week, we have witnessed the opening salvos of what promises to be the battle royal between federal and local authorities with respect to the employment and control of foreign workers in the CNMI. At a public forum held on March 4, federal Ombudsman Pam Brown announced that employers and foreign employees in the CNMI need comply only with federal laws with respect to their employment; and that the authority of the CNMI Department of Labor is preempted by P.L. 110-229, the Consolidated Natural Resources Act. The CNMI DOL has disputed this interpretation of the law. In a press release issued on March 12, 2010, by the Department of the Interior, Assistant Secretary Tony Babauta confirmed Ms. Brown’s statements as the position of the federal government. He stated that the position Ms. Brown expressed was a matter of consensus between the Department of Interior and the Department of Homeland Security. This was confirmed by DHS on the same day, in an eight-page Q&A titled “Employment Authorization and Verification in the Commonwealth of the Northern Mariana Islands,” issued by USCIS (an agency of the Department of Homeland Security). The document is available at http://tinyurl.com/yjypcbe. In today’s column we will discuss the notion of preemption; questions raised by federal preemption of CNMI labor laws; and the USCIS position as expressed in the new Q&A.


Black’s Law Dictionary defines “preemption” as follows:
A doctrine adopted by the U.S. Supreme Court holding that certain matters are of such national, as opposed to local, character that federal laws preempt or take precedence over state laws.

The definition of “federal preemption” is more specific:
The U.S. Constitution and acts of Congress have given to the federal government exclusive powers over certain matters such as interstate commerce and sedition to the exclusion of state jurisdiction. Occurs where federal law so occupies the field that state courts are prevented from asserting jurisdiction.

The federal authority to control the employment of foreign workers in the CNMI is derived from the federal government’s immigration and interstate commerce powers. The power to control the borders is an aspect of sovereignty inherent to every modern state. When the United States originally agreed, in the Covenant, to cede that authority over the CNMI government, it reserved the right to reassert that authority by later congressional action. That is what the CNRA did: the U.S. took back from the CNMI the federal immigration authority temporarily relinquished under the Covenant. Although the authority to regulate interstate commerce rests with the federal government, states can regulate intrastate commerce, that is commerce within the state’s borders. The CNMI has that same authority. States can and do have laws regulating labor. The floor for the protection of workers is set by federal law, one example is the federal minimum wage. But states can provide a greater level of protection, such as a higher minimum wage, and some states do. Thus, the CNMI could have labor laws that offer greater protection to workers than federal law. One of the questions is whether such protection can be extended to foreign workers only.

Does federal law preempt CNMI labor laws?

No one is contesting that the federal government now has the authority to govern who may enter the CNMI and on what terms they may remain. What is at issue is how far that federal authority extends over people already in the CNMI. Does it include the authority to govern the terms and conditions of employment of alien workers? If it does, how are workers employed prior to November 28, 2009 affected? Does federal law displace all existing CNMI labor laws, regulations and procedures, or just some? Does the CNRA strip the CNMI Department of Labor of all authority, or just some? Does CNMI authority over labor matters prior to Nov. 28, 2009, remain? Does the CNMI still have authority over umbrella permit holders? What are the legal obligations of employers who have employees with umbrella permits? Can the local preference requirement survive federal equal protection required by the U.S. Constitution? How about the employer’s responsibility for foreign workers’ medical expenses? Will employers of aliens be required to pay double fees, first to the federal government and then again to the CNMI government?

These are not academic questions. Since the Ombudsman’s announcement, we have had numerous inquiries from both employers and employees. Unfortunately, we do not have definite answers to any of the above questions. What we do have, for now, is the guidance provided by the Q&As published by USCIS several days ago. We will highlight its most critical provisions relevant to preemption below. We do not discuss provisions regarding compliance with Form I-9 CNMI, except with regard to the anti-discrimination provisions. The I-9 CNMI, with instructions, can be found at http://tinyurl.com/yk2qvob.

What USCIS says about employment of aliens in the CNMI
1. The employment authorization of aliens present in the CNMI is now a matter of federal law.

2. Umbrella permits issued by the CNMI government prior to Nov. 28, 2009, are recognized as valid employment authorization and will continue to be so through Nov. 27, 2011.

3. Umbrella permit holders in the following categories may work in the private sector: 240K (foreign worker); 240D (immediate relative of U.S. citizen, or Lawful Permanent Resident); 240H (foreign student); 240G (foreign investor); 240N (two year business); 240O (retiree). Umbrella permit holders in category 240B may only work for the CNMI government. Umbrella permit holders in category 240E (immediate relatives of aliens) may not work unless authorized on some other basis.

4. If an umbrella permit has two dates (report back date and expiration date); employment authorization is valid until the later date or Nov. 28, 2011.

5. An employer does not need the approval of CNMI DOL to hire a worker with an umbrella permit.

6. Umbrella permits cannot be extended; they are valid through Nov. 28, 2011. Even if the CNMI revokes an umbrella permit, the alien can still work legally through Nov. 28, 2011.

7. Umbrella permits provide work authorization only. It only affects the basic privilege to work in the CNMI. A contract between employer and employee cannot create an employment authorization. However, lawful contractual arrangements between employer and employee may be enforced as a matter of contract law. Occupational and licensing requirements must be met in addition to work authorization.

8. Umbrella permits do not provide a shield against removal/deportation. All aliens in the CNMI are subject to the regular bases for removal such as inadmissibility or commission of certain crimes. However, an alien who was lawfully present in the CNMI on Nov. 28, 2009, cannot be removed on the specific ground of being present without inspection until after Nov. 27, 2011. In other words, umbrella permit holders are protected against removal for up to two years even though they didn’t enter the United States in the usual manner.

9. Umbrella permits cannot be used as travel documents. If you leave the CNMI, you will need a U.S. visa or an advance parole (for foreign travel) or a regular parole (for domestic U.S. travel) to reenter to the CNMI and resume your CNMI status.

10. An umbrella permit issued after Nov. 28, 2009, is valid in only very limited circumstances: (a) a replacement permit if the original permit was lost, stolen or damaged; (b) a reissued permit to correct a clerical error or to add a photograph. This provision also implies that there can be no change of classification in an umbrella permit (e.g. foreign national worker 240K to immediate relative 240D or 240E). DOL retains the authority to reissue umbrella permits in these limited circumstances.

11. Section 274B of the INA prohibits discrimination on the basis of citizenship status or national origin in the hiring, firing, recruitment or referral for employment for a fee. This provision is enforced by the Department of Justice, Office of Special Counsel for Immigration Related Unfair Employment Practices. Toll free telephone numbers are provided in the Q&A. For more information, see OSC’s Web site at http://www.justice.gov/crt/osc.

As we said at the start of today’s column, we anticipate a federal-local battle royal, and the war of words reported in the press during the past couple of weeks is only the beginning. As private attorneys with clients who suffer real-world consequences for wrong decisions, we tend to be very conservative in our advice. What we have been telling people is that if you are an employer who can wait to hire or renew an employee (or if you are the employee in question), then wait until the dust has settled. If you have an existing employment contract, follow its terms because the CNRA does not affect contractual relations—the new Q&As are very clear on that point. If you cannot wait to hire or renew, however, then you have to decide which interpretation of the law is likely to prevail, the feds or the local government. We suspect that for a lot of people, the decision will depend on how much it will cost to hire a new employee, or renew an existing worker. If the federal government is correct, hiring and renewing umbrella permit holders just got a lot less expensive (at least until Nov. 27, 2011). Unless, of course, you get caught in the middle between the federal and local authorities, and end up being a test case.

The information contained in this column is intended as general information only, and not as individual legal advice. Readers should obtain professional legal advice before taking action with respect to their individual situations. Readers may submit questions regarding federalization or immigration issues to the authors by email to lexmarianas@pticom.com. Readers may also e-mail written questions through the Saipan Tribune at editor@saipantribune.com.

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