Regulating the Human Supply Chain

Author:Jennifer Gordon
Position:Professor, Fordham University School of Law
Pages:445-504
SUMMARY

Over the past decade, the United States has experienced a stunning 65% decline in undocumented immigration. While politicians seem unaware of this change, firms that once relied on local undocumented workers as a low-wage labor force feel it acutely. Such companies have increasingly applied to sponsor temporary migrants from abroad (sometimes called "guest workers") to fill empty jobs. In 2015,... (see full summary)

 
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Regulating the Human Supply Chain
Jennifer Gordon*
ABSTRACT: Over the past decade, the United States has experienced a
stunning 65% decline in undocumented immigration. While politicians
seem unaware of this change, firms that once relied on local undocumented
workers as a low-wage labor force feel it acutely. Such companies have
increasingly applied to sponsor temporary migrants from abroad (sometimes
called “guest workers”) to fill empty jobs. In 2015, the number of migrant
workers entering the United States on visas was nearly double that of
undocumented arrivals—almost the inverse of just 10 years earlier. Yet notice
of this dramatic shift, and examination of its implications for U.S. law and
the regulation of employment in particular, has been absent from legal
scholarship.
This Article fills that gap, arguing that employers’ recruitment of would-be
migrants from other countries, unlike their use of undocumented workers
already in the United States, creates a transnational network of labor
intermediaries—the “human supply chain”—whose operation undermines
the rule of law in the workplace, benefitting U.S. companies by reducing labor
costs while creating distributional harms for U.S. workers, and placing
temporary migrant workers in situations of severe subordination. It identifies
the human supply chain as a key structure of the global economy, a close
analog to the more familiar product supply chains through which U.S.
companies manufacture products abroad. The Article highlights a stark
governance deficit with regard to human supply chains, analyzing the causes
and harmful effects of an effectively unregulated world market for human
labor. Drawing on the author’s original research into innovative public,
private, and hybrid approaches to the governance of human supply chains,
the Article sets out and evaluates a range of potential interventions,
* Professor, Fordham University School of Law. The author would like to thank the following
people for their comments on earlier versions of this Article: Aditi Bagc hi; James Brudney; Janie
Chuang; Harris Freeman; Judy Fudge; Tracy Higgins; Clare Huntington; Ethan Leib; Brishen
Rogers; and Linda Sugin. I deeply appreciate the support of the Open Society Foundations
Fellowship and Fordham University School of Law for my res earch and writing on this topic. Finally,
I am very grateful to Alison Shea of the F ordham Law Library and Sarah Jaramillo, formerly of the
Fordham Law Library and now at the N.Y.U. Law Library, and to my research assistan ts on labor
recruitment, Alex Cárdenas, Janice Chua, Lauren Cooperman, Naseem Faqihi, Ang elica Kang,
Henry Parr, Natalie Puzio and Aaliya Zaveri.
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446 IOWA LAW REVIEW [Vol. 102:445
ultimately proposing a new supply chain liability that realigns risk and
responsibility for the harms that attend the global recruitment of low-wage
workers.
I. INTRODUCTION ............................................................................. 446
II. THE RECENT RISE OF GLOBAL LABOR INTERMEDIARIES IN U.S.
LOW-WAGE LABOR MARKETS ........................................................ 454
III. THEORIZING GLOBAL LABOR RECRUITMENT ................................ 468
A. RECRUITMENT AS A HUMAN SUPPLY CHAIN .............................. 468
B. WHERE HUMAN AND PRODUCT SUPPLY CHAINS MEET: AN
EXAMPLE ................................................................................ 472
IV. REGULATING THE HUMAN SUPPLY CHAIN .................................... 474
A. THE GOVERNANCE DEFICIT IN GLOBAL LABOR RECRUITMENT ... 474
B. LESSONS FROM THE PRODUCT SUPPLY CHAIN ........................... 478
1. Lessons from the Regulation of the Product Supply
Chain .............................................................................. 479
2. Are These Insights Applicable to the Regulation of
Human Supply Chains? ................................................ 485
C. REGULATING THE HUMAN SUPPLY CHAIN: DIRECT, JOINT, AND
CHAIN RESPONSIBILITY ........................................................... 490
1. Applying Shared Liability to the Human Supply
Chain .............................................................................. 491
2. Strict Liability as a Possible Approach ......................... 494
i. Benefit from Costs Savings Beyond Those Permitted by
Law .......................................................................... 495
ii. Substantial and Foreseeable Risk of Harm .................. 496
iii. Incentives for Recruiters to Discontinue Their
Rent-Seeking Behavior................................................ 497
3. Practice: Public, Private, and Hybrid Approaches ...... 499
V. CONCLUSION ................................................................................ 503
I. INTRODUCTION
Over the past decade, the United States has experienced a 65% decline
in undocumented immigration.1 While politicians largely ignore this change,
firms that have relied on local undocumented workers as a low-wage labor
force feel it acutely. Such companies have increasingly applied to sponsor so-
called “guest workers” to fill low-wage jobs. In 2015, the number of temporary
1. See infra n otes 37–41 and accompanying text.
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2017] REGULATING THE HUMAN SUPPLY CHAIN 447
migrant workers entering the United States on such visas was nearly double
that of undocumented arrivals—the inverse of just ten years earlier.2
U.S. employers’ shift to migrant worker visas has given a newly prominent
place to intermediaries abroad in the country’s low-wage work structures. In
moving toward greater reliance on legal temporary migrants as a low-wage
labor force, the United States is joining a trend already dominant around
much of the globe. Almost all low-wage temporary visa programs worldwide,
including in the United States, require the employers to hire the worker while
she is still in her home country, which makes an intermediary a practical
necessity if the employer does not plan to travel there to contract workers.3
Recent estimates put the number of low-wage legal temporary migrant
workers in the United States recruited via intermediaries at 80% of the total
or higher,4 on par with figures in other migration corridors around the
world.5 By contrast, U.S. firms rarely use recruitment entities located in other
countries when hiring undocumented immigrants. Instead, they tend to hire
2. See infra note 44 and accompanying text.
3. CENTRO DE LOS DERECHOS DEL MIGRANTE, MONITORING INTERNATIONAL LABOR
RECRUITMENT: A CROSS-VISA EXPLORATION OF REGULATORY CHALLENGES 10–13 (2011), https://www.
macfound.org/media/files/Monitoring_International_Labor_Recruitment.pdf.
4. Megan Twohey et al., Wanted: Foreign Workers—and the Labor Brokers Accused of Illegally Profiting
from Them, REUTERS INVESTIGATES (Feb. 19, 2016, 3:20 PM), http://www.reuters.com/investigates/
special-report/workers-brokers (“Since the 2007 fiscal year, for instance, Reuters found that
intermediaries were involved in helping secure visas for 80 percent of the 2 million foreign workers
approved for agricultural and other low-skill jobs.”). A survey of 382 Mexican H-2A migrants across
seven states in Mexico by a coalition of five nongovernmental organizations puts the percentage at
94.5%. JORNALEROS SAFE, EXECUTIVE SUMMARY: MEXICAN H2A FARMWORKERS IN THE U.S.: THE
INVISIBLE WORKFORCE 7–8 (2013), https://www.splcenter.org/sites/default/files/d6_legacy_files/do
wnloads/resource/executive_summary_jornaleros_safe.pdf (discussing the number of interviewees
and percentage using intermediaries). Studies that rely on gov ernment docume nts rather tha n worker
interviews reach lower numbers. For example, a Centro de los Derechos del Migrante report based on
Department of Homeland Security (“DHS”) applications noted that almost 62% of workers applying
for H-2A and 84% of those applying for H-2B visas in 2011 reported having used a recruitment agent.
CENTRO DE LOS DERECHOS DEL MIGRANTE, RECRUITMENT REVEALED: FUNDAMENTAL FLAWS IN THE H-2
TEMPORARY WORKER PROGRAM AND RECOMMENDATIONS FOR CHANGE 11 n.12, http://www.
cdmigrante.org/wp-content/uploads/2013/01/Recruitment-Revealed_Fundamental-Flaws-in-the-
H-2-Temporary-Worker-Program-and-Recommendations-for-Change.pdf (last visited Nov. 4, 2016).
Likewise, the Government Accountability Office (“GAO”) states that approximately 44% of U.S.
employers use formal intermediaries for H-2 visa recruitment. See U.S. GOVT ACCOUNTABILITY OFFICE,
H-2A AND H-2B VISA PROGRAMS: INCREASED PROTECTIONS NEEDED FOR FOREIGN WORKERS 26 (2015),
http://www.gao.gov/assets/670/668875.pdf. The 44% number is based on the GAO’s review of H-2
petitions filed by employers with DHS. The GAO reports that, in addition to the 44%, “some employer
industry groups” state that a significant number of employers deputize a foreman or returning migrant
as their recruiter. Id. at 27.
5. See DOVELYN RANNVEIG MENDOZA, MIGRATION POLICY INST., REGULATING PRIVATE
RECRUITMENT IN THE ASIA–MIDDLE EAST LABOUR MIGRATION CORRIDOR 2 (2012), http://www.
migrationpolicy.org/research/regulating-private-recruitment-asia-middle-east (finding that 80%
of migrant workers in the Asia–Middle East corridor are recruited by intermediaries, rather than
by employers directly).

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