As immigration crackdown falters, key ruling awaited. "The government databases are horrible. "Absolutely people will be fired and people will be wrongly fired."

When the Bush administration announced a crackdown on companies suspected of employing illegal immigrants last month, labor unions, business and immigrant rights groups shuddered.

The unions feared mass firings, including the wrongful dismissal of many legal immigrants and U.S. citizens. Business groups worried entire industries could be crippled by labor shortages. And advocates of tougher immigration enforcement were elated.

Six weeks later, the crackdown is fizzling.

Under the plan, notices sent to employers whose workers had unverifiable Social Security numbers would include, for the first time, a letter stating those workers must be fired within 90 days or the company could face prosecution. Studies show that most illegal immigrants find work using bogus Social Security numbers.

But days after the Aug. 10 announcement, administration officials conceded that the Social Security Administration, which sends the so called "no-match" letters, would still be prohibited by privacy laws from telling immigration officials which employers were getting the letters.

That disconnect, critics say, makes the measure toothless, leaving Immigration and Customs Enforcement, unable to use the information in deciding which companies to prosecute.

Then, on Aug. 31, came another blow: an order issued by a federal judge in San Francisco temporarily barring the government from sending the letters.

The order by Judge Maxine M. Chesney came in response to a lawsuit filed by the American Civil Liberties Union, the AFL-CIO and other labor groups, who feared large numbers of legal workers would lose their jobs because of the millions of errors in federal databases.

For now, an initiative that many said could have been a bombshell on the nation's business and immigration landscape remains on ice.

"This has the potential to wreak unimaginable havoc and changes in how people deal with employment law across America," said Tamar Jacoby, a senior fellow at the Manhattan Institute, a conservative think tank. "This is where you get control of the immigration system, where the rubber meets the road."

All sides are waiting for Oct. 1, when a federal judge will rule on the ACLU's effort to block the no-match letters permanently. The judge also could order the letters released, thus jump-starting the Department of Homeland Security crackdown.

The new no-match letters were part of a series of toughened enforcement measures unveiled by Homeland Security Secretary Michael Chertoff, including added detention space and construction of additional fencing along the U.S.-Mexican border.

The proposals came in the wake of the collapse in the Senate of legislation that would have punished employers of illegal immigrants and created a path to legal residency for many of the 12 million illegal immigrants believed to be living in the country.

Currently, Social Security no-match letters are sent only to alert employers and workers that a discrepancy may exist, but bosses are not required to take action.

Under the crackdown, the letters sent to roughly 130,000 employers would include a DHS notice advising them about new rules to follow. If the workers in question cannot show within 90 days that they have valid Social Security numbers, employers must fire them or risk prosecution.
With DHS still unable to find out which employers are receiving them, experts disagree on how effective the letters will be.

"If the DHS and Social Security don't share the information, then it's just an empty threat," said Bob Dane of the Federation for American Immigration Reform (FAIR), which supports lower immigration levels. "It just perpetuates what was a wink and nod, and makes it a wink, wink and a nod."

Others say the letters, with strongly worded threats and mentions of new tougher fines for employers of illegal immigrants, will prompt mass firings by employers fearful of being busted.
While DHS cannot use the letters to determine which employers to investigate, they could turn up as crucial evidence that a given company knew of the problem if it becomes the subject of a federal investigation.

"Smaller companies who may be operating on a model that incorporates undocumented workers are extremely nervous," said Robert Groban, an attorney with the Manhattan law firm Epstein Becker & Green, which has been running seminars titled "The Iceman Cometh," a reference to the Immigration and Customs Enforcement, commonly referred to as ICE.

Groban said the fears of groups like the ACLU are warranted, noting the Social Security Administration's database is riddled with millions of errors. They include typographical errors and discrepancies caused by married women still listed under their maiden names or Asian and Hispanic workers who may have listed their family surname as a first or middle name, the custom in many countries.

"The government databases are horrible" Groban said. "Absolutely people will be fired and people will be wrongly fired."

Experts on both ends of the political spectrum predict another effect: an expansion of the underground economy. Once the letters go out, businesses will turn to labor subcontractors to shield themselves from the liability involved in hiring illegal immigrants.

Others will simply begin paying cash to workers without Social Security numbers. And some workers will simply rotate from job to job each year, quitting when the next round of no-match letters is issued.

Jacoby, the Manhattan Institute analyst, said she favors a crackdown on employers of illegal immigrants as the best way to tackle the illegal immigration crisis. But she thinks it will work only if accompanied by measures that provide a way for workers to legalize their status.

"I don't like being in the position of saying 'I'm glad the government can't enforce the law,'" she said. "But it's going to create more illegality."