Schauer slams Hallmark over undocumented workers

After firing off letters to the administrator of the Environmental Protection Agency as well as the Secretary of Labor calling for an investigation into allegations a Calhoun county oil spill subcontractor was using undocumented workers to clean up oil, Rep. Mark Schauer gave the Michigan Messenger an earful of outrage over the situation.

In an interview, Schauer took aim not only at the undocumented worker hiring scandal, but also the whole culture of using independent contractors to skirt the law.

“I have worked for some time on the independent contractor fraud that goes on. This is when, typically in the construction trades — and this situation on the river clean up sort of classically fits the mold — where companies will hire workers as independent contractors, as 1099 independent contractors. It’s specifically done to evade paying taxes,” Schauer said, noting independent contractor payments do not have any federal or state taxes deducted from them. This leaves the individual responsible for those taxes. “Now that’s cheating the taxpayer, but it’s also creating an unfair advantage for these companies that are hiring workers as independent contractors rather than full employees.”

This of course is an issue tied to undocumented workers, Schauer noted. In an interview with Phillip Hallmark, CEO of Hallmark Industrial out of Texas, on Monday, Hallmark said his independent contractors were not required to fill out I-9 federal forms. Those forms verify that a person is legally eligible to work in the United States.

Hallmark Industrial has since been fired from the clean up efforts in Kalamazoo by Enbridge contractor Garner Environmental. The firing came less than 24 hours after Michigan Messenger unveiled an investigation that found the company allegedly employing undocumented workers, and violating federal and state safety rules for hazardous clean up zones.

“In this case this seems to be a loophole in which the employer is claiming they don’t have to check the legal status of these workers and require them to complete I-9 forms,” Schauer said. “So there’s tax fraud and there’s also a violation of the law by hiring undocumented workers, it appears.”

Schauer says this unfair advantage the independent contracting process allows, combined with the lack of legal status verification, makes it hard for Michigan workers to compete.

“It’s outrageous and disgusting that our local workers — including many who have hazmat training and certifications — have been cheated out of these opportunities to do this work,” Schauer said. “This is another example of a company cutting corners ad cheating our workers out of an opportunity to support their families.”

Schauer said he has been trying “since the very start” of the spill to connect local workers with Enbridge Energy Partners. But those attempts have failed.

Michigan Messenger reported on similar issues last month when a local union complained that HAZWOPER-certified union workers were unable to get cleanup jobs on the river.

“No wonder they haven’t been receptive,” Schauer said. “They’re working with contractors and subcontractors that are hiring undocumented workers.”

Jonathan Byrd, legislative director of the Michigan Laborers Council, also expressed concern about the continued lack of access for local workers to clean up jobs.

“Our community deserves better. After all that Calhoun and Kalamazoo have gone through, we deserve a quality cleanup effort.” Byrd said. “With our unemployment rate at unacceptable levels, it’s disappointing that certified and properly trained Michigan workers are unable to clean up their own community. It’s important for Enbridge and the EPA to enforce and verify standards that prohibit unscrupulous out-of-town contractors from exploiting workers.”

State Rep. Kate Segal (D-Battle Creek) also issued a statement on the allegations, calling the situation “outrageous.”

Echoing his letters to the EPA and the Secretary of Labor, Schauer is calling for investigations and prosecutions.

“I think it should be investigated quickly, and if there are violations of the law, they should be prosecuted,” said Schauer.

In Schauer’s letters to the federal agency heads, he asks if Enbridge Energy had “turned a blind eye” to the violations of safety rules and the hiring of undocumented workers.

Enbridge spokesperson Terri Larson denies any wrong doing, and notes that every contractor is required, by its agreement with Enbridge, to follow all state and federal laws.

Schauer says he does not know what Enbridge “is aware of or not aware of.”

“What I do know is that they have in this case chosen to retain a subcontractor who bused workers from Texas, when Michigan’s unemployment rate is 14 percent and the unemployment rate in the construction trades is over 25 percent,” he said. “We have trained workers right here that have been trying to clean up the river this company spoiled. Now I think I know why (the locals were not hired).”

Schauer said the allegations of safety violations and the hiring of undocumented workers will become part of a scheduled Sept. 15 House Committee on Transportation and Infrastructure hearings on the July 25 oil spill.

He says the oil spill was a violation of the people of Calhoun county and “it shouldn’t have happened.”

“What people are looking for is fundamental fairness and that appears to have been violated here,” he said.