Wal-Mart's cut-rate labor

THE JANITORS were cleaning up in some 60 Wal-Mart stores in 21 states -- including Massachusetts and New Hampshire -- on Oct. 23, 2003, when federal immigration agents suddenly appeared. It was a series of raids. Agents arrested 245 illegal immigrants who had been hired to clean the stores by cleaning companies contracting with Wal-Mart. Lawyers representing the workers say their clients were locked inside stores and denied overtime pay. After the raids, Wal-Mart contacted federal authorities and promised to cooperate with the investigation.

This wasn't Wal-Mart's first offense. In 1998, federal agents targeted cleaning companies that were hiring illegal immigrants from Eastern Europe. This led to a 2001 case in which agents went to Wal-Mart stores in four states and arrested 100 illegal immigrants. The outcome: Earlier this month Wal-Mart admitted no wrongdoing but agreed to pay $11 million to the government -- four times more than any single payment in a similar case. Wal-Mart has also agreed to strengthen its compliance programs, exercising more scrutiny over its subcontractors. In addition, 12 cleaning companies that provided services to Wal-Mart from 1998 to 2002 have agreed to plead guilty to criminal immigration charges and pay $4 million.

It's a law enforcement victory. But it shows the flaws in national immigration policies. Market forces fuel the problem: Companies want workers, and undocumented immigrants want wages. Many companies take the risk -- hiring illegal workers, hoping they won't get caught, and leaving workers with little protection against abuse.

Last year President Bush proposed a guest worker program that would have let illegal immigrants work for three years with the chance to apply for another three-year stay. Although it sought to rationalize policy, Bush's idea is controversial with some in his own party. And even with a guest worker program, the country would still need additional reforms.

Another strategy is to penalize employers who hire illegal immigrants. But while the $11 million settlement with Wal-Mart is record-setting, it isn't a lot for a company that had $285.2 billion in sales for the year ending Jan. 31, 2005. In the future, sanctions should be tougher so fines don't seem like an acceptable cost of doing business.

Ultimately, it's immigrant families trying to make ends meet who suffer the most from weak immigration policies. Ali Noorani, head of the Massachusetts Immigrant and Refugee Advocacy Coalition, points to the workers who deal with unscrupulous employers and then get deported.

The president should continue to press for reform that helps businesses and immigrant workers team up in fair and legal settings.

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