A federal appeals court has delivered a decisive blow to the private prison company GEO Group, upholding a previous ruling that requires the company to pay more than $23 million to the state of Washington and hundreds of immigrant detainees. This verdict stems from a long-running legal battle over a work program in which detainees at a Tacoma, Washington, facility were paid a mere $1 per day for their labor.
The full 9th U.S. Circuit Court of Appeals refused to re-hear the case, solidifying an earlier panel’s conclusion that GEO Group is not exempt from state minimum wage laws. The company had argued that its contract with U.S. Immigration and Customs Enforcement (ICE) shielded it from such regulations, claiming it should have the same immunity as the federal government. However, the court found that the federal government did not mandate the low wages or the existence of the work program itself, and therefore, GEO Group must comply with state law.
The Legal Battle and Its Implications
The decision is a major development in a pair of consolidated lawsuits that began in 2017. The ruling affirms a $17.3 million jury verdict for the detainees who performed various jobs, including cooking, cleaning, and barbering, along with a separate $6 million award for the state of Washington.
The legal reasoning centered on the question of whether a private company, simply by virtue of contracting with the government, can inherit the government’s immunity from state laws. Six dissenting judges argued that the ruling set a dangerous precedent that could allow states to interfere with federal policy by targeting government contractors. In his dissent, Circuit Judge Patrick Bumatay, an appointee of a Republican president, expressed concern that the decision would allow states to “impair any federal policy.”
In response, Circuit Judge Mary Murguia, an appointee of a Democratic president, wrote for the majority, stating that the dissenting view was flawed. She noted that adopting such a position would allow any government contractor to avoid paying a state’s minimum wage to its employees.
The GEO Group has stated its intention to appeal the decision to the U.S. Supreme Court, citing that the ruling “clearly violates the Supremacy Clause” of the U.S. Constitution.
