Business Risks for Mason Contractors
By Timothy Hughes
The new administration of President Trump has ushered in a dramatic change in tone toward immigration policy. It is an understatement to say we are not certain about where immigration law and policy are going in the next several years. What is clear is that dramatic changes in immigration policy and enforcement present significant levels of business risks for mason contractors and owners of construction contracting firms.
The scope of the issue
According to 2016 statistics from the Bureau of Labor Statistics (BLS), the construction industry as a whole employs 10,328,000 individuals, nationally. Across the country, fully 28.9 percent of the construction workforce self-identifies as Hispanic or Latino. This compares to 16.7 percent of the total workforce.
For mason contractors, the percentages are far higher. There were 160,000 brick, block and stonemasons in the 2016 BLS estimates. Fully 45.5 percent of those masons were Latino. There were 56,000 cement masons and concrete finishers with a staggering 48.8 percent of them being Latino.
These numbers will not surprise anyone in the construction industry. It must be emphasized that these are national averages. Many localities have far higher numbers, such as the Washington, D.C., area where I live. Here, a high degree of immigration affects the local labor market, and the Latino portion of the masonry employment population appears to be greater than 70 percent. It is more likely in the 80 percent to 90 percent range.
Many of these workers are either U.S. citizens or have legal visas. It is certain that a percentage of these workers are undocumented and at risk of adverse legal action in the event of aggressive immigration policies and enforcement. This means that the entire construction industry – the mason contracting business, in particular – is seriously threatened with an evaporation of available skilled workers.
What is going to happen?
The real answer is that no one knows what is about to happen. President Trump took office having made immigration a central campaign message. One of his key campaign themes included building a wall that Mexico would allegedly fund. One of his first acts as President was signing a highly controversial executive order temporarily banning travel from seven Muslim-majority countries. This executive order faced immediate legal challenge resulting in several courts issuing national injunctions barring its enforcement. The Trump administration has promised issuance of a new cleaned-up executive order reinstating portions of the so-called travel ban, but as of the writing of this article that is still in the drafting phase.
The next steps on a broader immigration policy have been far from clear. While it has received little attention, under the previous Obama administration, the U.S. Immigrations and Customs Enforcement Agency (ICE) carried out wide scale deportation efforts resulting in deportations of almost 3 million people. The Obama administration focused most of its deportation efforts expressly. However, these were undocumented immigrants who were convicted of more serious crimes. Draft enforcement directives within the current Department of Homeland Security appear to point toward a much broader deportation mandate and focus. The ultimate directives are still in process, and as such the actual rules are quite unclear.
The current status of ICE efforts is equally unclear. A review of news articles and Twitter feeds reveals hosts of anecdotal reports of ICE raids, including raids on houses of worship, homeless shelters and other locations. There was even one report of a domestic violence victim being detained in the courthouse at her protective order hearing, presumably on the tip of the assailant. It is difficult to discern the factual accuracy or scope of these reports. Are these indicative of a true change in course, or the result of natural anxiety in a climate of uncertainty and change? Only time will tell.
I am writing this article the morning after President Trump’s first primetime address to a joint session of Congress. Yesterday, President Trump suggested privately that he was open to a comprehensive immigration overhaul that would include legal status, but not citizenship, to undocumented immigrants that had not committed serious crimes. He did not include any of this language in his address. For readers of this article, all of this presents a climate of dramatic uncertainty and significant business risks for mason contractors, given the potential impact on the masonry labor employment market.
What should mason contractors do?
The genesis of this article around business risks for mason contractors flows from a recent call from a long-time friend and client. He owns a mason contracting business and, in a general sense, would be a big fan of deregulation, small business growth, and a better business climate for the construction industry. Despite being a natural fan of the new administration, he called seriously concerned about the immigration chaos and lack of clarity, and he felt that getting a handle on these immigration issues was potentially an existential crisis for his business moving forward.
I completely agree with his sentiment. You cannot avoid this issue. You need to understand what is happening, what policies are adopted, and what risks those policies may impose on your business. If you do not already have an immigration lawyer, you absolutely need an immigration lawyer on retainer now, rather than later. It is worth investing some money into understanding the current climate and continuing this investment through this transition period. Given the gravity of the issue and its potential impact, you owe it to yourselves, your businesses, your employees, and your clients to do what you can to get a handle on this issue moving forward.
Timothy R. Hughes, Esq., LEED AP, is the Managing Shareholder of the law firm Bean Kinney & Korman, P.C. in Arlington, Va. A construction, real estate and business attorney, he was recognized as a “Leader in the Law” in 2010 by Virginia Lawyer’s Weekly, a member of the “Legal Elite” for Construction Law by Virginia Business Magazine, and one of the “Best Lawyers in America” for Virginia Construction Law. A former chair of the Construction Law and Public Contracts Section of the Virginia State Bar, he may be reached at 703-525-4000 or by email at firstname.lastname@example.org.