A federal jury in Washington sided with detainees and the state attorney general yesterday in a lawsuit claiming that private prison corporation GEO Group violated state minimum wage laws by paying detainees $1 per day to cook and clean at the Northwest ICE Processing Center in Tacoma, Washington. The verdict in two cases, Nwauzor v. The GEO Group, No. 3:17-cv-05769 (W.D. Washington September 26, 2017) and State of Washington v. GEO, No. 3:17-cv-05806 (WD Wash. October 9, 2017), now returns to the jury for it to determine the damages GEO Group owes the former detainees who are part of the class action lawsuit.
Filed in 2017, these cases challenge the “Voluntary Work Program” that is commonplace within ICE’s network of private prisons. Under ICE’s existing detention standards, people detained in the agency’s prison system “shall be provided the opportunity to participate in a voluntary work program.” In exchange, they are to be paid “at least $1.00 (USD) per day.”
Detainees argued that this violated the state’s minimum wage act. That law requires “every employer shall pay to each of his or her employees who has reached the age of eighteen years” a specified rate. R.C.W.A. § 49.46.020(1). When the lawsuit was filed in 2017, the minimum wage in Washington was set at $11 per hour.
The big question was whether GEO Group is an “employer” to the people who participate in the VWP. The Washington law says that an “employer” is “any individual, partnership, association, corporation, business trust, or any person or group of persons acting directly or indirectly in the interest of an employer in relation to an employee.” R.C.W.A. § 49.46.010(4). In turn, an “employee” is “any individual employed by an employer,” with exceptions made for “Any resident, inmate, or patient of a state, county, or municipal correctional, detention, treatment or rehabilitative institution,” among others. R.C.W.A. § 49.46.010(3). Clearly these definitions are far from precise. They are effectively circular. An “employer” is anyone who employs an “employee” and an “employee” is anyone who works for an “employer.” Relying on that imprecision, GEO Group argued that the state law didn’t apply to detained individuals because they are not the company’s “employees.”
Yesterday’s jury verdict rejected that argument. Instead, the jury seems to have sided with the detained individuals and the state attorney general who argued that GEO Group is an “employer” and the detained individuals are its “employees,” thus the state minimum wage act applies. Because this was a decision of a jury, there is no judicial opinion I can point to. Also, I wasn’t in the courtroom so I can’t be sure about the details of the jury’s decision. As is common in civil jury trials, the jury verdict was memorialized in a simple one-page form that provides, “We, the Jury, find for Plaintiffs.” No explanation was provided or expected.
Despite that, it’s clear that the jury sided with the detained migrants against GEO. That alone is momentous. Multiple lawsuits have been bouncing through the courts in recent years challenging labor performed inside ICE’s prison network. Most recently, a federal appellate court found that people held in a New Mexico prison operated by CoreCivic were not protected by the Fair Labor Standards Act, the federal law that sets the federal minimum wage. Ndambi v. CoreCivic, 990 F.3d 369 (4th Cir. 2021). To the Ndambi court, the people detained there were not in an employer-employee relationship with CoreCivic. A much older decision from the Fifth Circuit reached a similar conclusion. Alvarado Guevara v. INS, 902 F.2d 394 (5th Cir. 1990).
Under a different legal theory earlier this year, however, the Fifth Circuit held out the possibility of liability for private prisons. In Gonzalez v. CoreCivic, 986 F.3d 536 (5th Cir. 2021), the appellate court held that a federal law barring forced labor applies to people held in ICE’s prison network. That case remains pending in a Texas federal court.
No matter what the jury determines on damages, GEO Group is almost certain to appeal yesterday’s verdict. As a profit-seeking company, too much of its business success turns on tapping inexpensive labor from within the detained population.
Update (November 4, 2021): Indeed, on November 4, GEO announced that it would appeal the $23.2 million judgement against it to the Ninth Circuit. In a press release, the company said that it would ask the Ninth Circuit to review whether Washington’s minimum wage law applies to the detained people who participate in the VWP. On the same day, the company announced that it has received $1.7 billion in revenue during the first nine months of 2021, including $557 million in the third quarter.
Update (November 11, 2021): Today, GEO Group submitted a Motion for Judgment as a Matter of Law asking the court to set aside the jury’s verdict in favor of the detained migrants. Separately, the company filed a Motion for Remittitur in which it asked the court to reduce the damages award from $17,287,063.05 to $13,646,928.32 or, alternatively, grant a new trial.