The multibillion-dollar prison company GEO is doing very well financially. It runs 16 facilities around the country, including the ICE detention center in Tacoma, and its stock price doubled after Election Day.
With the number of ICE detainees now at a five-year high under President Donald Trump, how people are being treated and compensated for their labor is as much an issue as it ever was. The company was paying detainees a dollar a day to do cleaning and other jobs that it would otherwise have to pay contract workers at minimum wage to do.
Washington state sued the company for not paying the state’s minimum wage, and won in federal court in 2021, a decision that was affirmed earlier this year by the 9th Circuit Court of Appeals. The company petitioned last month for a rehearing of its appeal by all 9th Circuit judges.
McKenzie Funk is following this story for ProPublica and joins us with the details.
Note: The following transcript was transcribed digitally and validated for accuracy, readability and formatting by an OPB volunteer.
Dave Miller: From the Gert Boyle Studio at OPB, this is Think Out Loud. I’m Dave Miller. The for-profit prison company GEO runs 16 facilities around the country, including the ICE detention center in Tacoma. The company had been paying detainees there $1 a day to do cleaning and other jobs. Washington state sued the company for not paying that state’s minimum wage. The state won in federal court in 2021, a decision that was affirmed earlier this year by a panel from the 9th Circuit Court of Appeals. The company recently petitioned for a rehearing of that appeal.
McKenzie Funk is following the story for ProPublica, and he joins us now. It’s good to have you back on the show.
McKenzie Funk: Thanks.
Miller: So this legal debate is about how much immigration detainees should be paid for work they do while in these lockups. What kinds of jobs are we talking about?
Funk: They were doing maintenance. Things break down when you have so many people in one facility. So painting walls, repairs, they were doing the daily cleaning, sweeping and mopping floors, helping with food preparation, cleaning toilets, doing laundry, but a lot of the work of just keeping that many people fed and clothed.
Miller: What was the state of Washington’s argument for why GEO should pay the state’s minimum wage for work done by detainees?
Funk: Well, they were saying a multi-billion dollar corporation is trying to get away with paying them $1 a day. There was some sort of indignation about the fact of it. But the legal argument was pretty simple: Washington has a minimum wage law, and the way that minimum wage law is written, it does not exclude a private corporation like GEO Group from that law. So they said, you’ve broken our law.
Miller: You note in your article that you didn’t get a response from this company, GEO, when you reached out to them. We reached out to them, we haven’t heard back either. But in a press release, the company has written this: “Simply put, we believe the state of Washington has unconstitutionally violated the supremacy clause of the United States Constitution.” What do they mean?
Funk: Well, immigration enforcement and including detention is a federal issue. It’s not something the states do. And this is one of those things that the federal government does. So they say, what happens in this facility – which should be clear, is run by GEO Group on behalf of Immigration and Customs Enforcement – because this is a federal facility and because the federal minimum wage does not apply to these detainees, you, the state, are trying to come in here and preempt our authority. You’re putting yourselves above the federal government.
Miller: The case was filed during Donald Trump’s first presidency. These things take a while, so then it kept going during Joe Biden’s term. It’s now still alive in Trump’s second administration. These are obviously two very different presidents with very different approaches to most issues. Is there any difference in the way they’re treating this one?
Funk: The short answer is no. The Biden administration, though of course its approach to immigration enforcement was very different than the Trump administration’s, both the first and the second … One thing that Biden consistently tried to do was uphold that supremacy. And there’s another case in Washington state that involved immigration flights, the deportation flights that were leaving from Boeing Field. And in that case, the county tried to stop the planes from landing and the federal government stepped in and kept on fighting it under Biden. And in general, the federal government, under whichever president it’s been, has tried to preserve their prerogatives here. They have more or less continued the same arguments.
Miller: One of the arguments that the company made has to do with the way Washington treats workers who are incarcerated in its state prisons. What’s that argument?
Funk: Well, Washington does not pay minimum wage to people in its state prisons. So it looks like hypocrisy. And their argument was basically, look, you don’t enforce this on yourselves, on your prisoners, so why are you enforcing it on us in our facility?
Miller: How did the 9th Circuit respond to that argument?
Funk: One of the three judges on this preliminary panel – and as you said, it could go on to the full 9th Circuit here – was open to this argument. And the other two were not. They said, this is an apples to apples comparison. For one thing, Washington doesn’t let private companies run its prisons. So there’s no question in the way that Washington law is written according to their read of Washington’s law. There is no question that this is a different situation.
It’s also important to keep in mind that people in prison are people who’ve been convicted of a crime, and they’re doing time for that crime. And people in ICE custody, in the ICE facility, that’s a civil detention, many people won’t have had any criminal history at all. So it’s a very different case on that ground as well. That’s less of an argument that the judge has made, but it is a very different case to say that someone in a state prison is at the same category of detainee as someone in ICE custody.
Miller: Where does this case stand right now?
Funk: Well, GEO, having lost in court over and over again about this, it’s now still in the 9th Circuit. They have asked for a rehearing at the 9th Circuit, either rehearing by the same three judges, the panel that originally looked at the case, or ideally an en banc hearing, which is to say every judge on the 9th Circuit. And they’ve also vowed to keep on fighting it all the way to the end. The assumption is that the end means the Supreme Court.
Miller: Who is doing the work right now? You outlined, it really just seems like all of the maybe non-corrections jobs required at a detention detention facility – cooking, cleaning and maintenance. If GEO is not having detainees do it, who is?
Funk: Well, I think they have brought in, at this point … It’s important to say that after having this original ruling against them in 2021, rather than say, OK, we lost, we’re going to pay minimum wage to the detainees, they stopped this program entirely with ICE’s permission. And for a moment there, according to detainees who spoke to the AP at the time, nobody was really doing the work. It got very dirty. Since then, as I understand it, they have hired outside contractors to do some of it. There are some full-time employees who are still there. And as it stands, I’m told by people inside and [by] activists who follow this, that the number of people they’ve hired are not sufficient.
Miller: What has that meant for conditions at the site?
Funk: Well, people I’ve talked to have described that the sheets are black, the towels are black, that the laundry is dirty, that the food is inedible. Someone called last night, and I was talking to someone inside, and she said, “the food looks like it’s something that my dog just vomited out.” Beyond that, the complaints about the food are long standing. Beyond that, the food is coming later and later. And so we’re talking 9, 10, someone told me dinner came at midnight the other day. So there are clearly some real issues with not having enough labor.
This is exacerbated, of course, by the fact that detention centers across the country and in Tacoma right now are very full, as full as they’ve been. So they’re dealing with crowding and, in some places, overcrowding. I’m not sure that’s true in Tacoma. They have fewer employees than is perhaps ideal and they have more people to take care of.
Miller: What have these jobs, even at just $1 a day in the past, meant for detainees?
Funk: Well, they need the money in many cases. It’s not unlike the prison system, where there is a monopoly on phone calls, now video calls, and communication out of there. So one of the things that the detainees need money for is simply to be in touch with family members and friends outside. So they’re earning them $1 a day and that’s not a lot, but if it’s the only way that they can call family, I think that was very important to many people. Then there’s the commissary. If they don’t like the food, which many have told me they do not, then maybe they can buy some food at the commissary and that’s also money they could earn doing this labor.
Miller: Is it in the public record, how much it would cost the company to pay detainees the state minimum wage?
Funk: Not exactly, but we can approximate it because they have said in filings that in order to do all the work that the detainees were doing, they would require 85 full-time employees – this is at Tacoma. The minimum wage in Washington is now $16.66 an hour, so we’re talking a little over $10,000 a day for the entire facility in wages, which would mean about $3 million a year. Now, it’s worth pointing out that when the suit was filed at least, GEO Group was making about $20 million a year in profits just from that one facility in the Northwest ICE Processing Center.
Miller: How is GEO doing as a company overall these days?
Funk: Its stock has doubled. Well, its stock did double after Trump was elected for a second time. It shot up. It was one of those Trump stocks people were talking about. Its major shareholders, which include BlackRock which owns about 15% of it, means many people with retirement funds own a little bit of GEO Group. BlackRock did really well, GEO Group’s doing really well, and they continue to do so. I looked up to see how it’s doing today and as of right now, it’s market capitalization is $4.3 billion. That’s what the company is worth.
Miller: The suit we’ve been talking about is focused on GEO’s facility in Tacoma, but as I mentioned, they’ve got contracts to detain people facing deportation proceedings in about a dozen other sites. What does this issue look like nationally?
Funk: I certainly hadn’t understood and I don’t think it’s well understood that most of the immigrant detainees in this country are held in privately-run facilities. This can be upwards of 90%. So this case could have repercussions across the country. And in addition to GEO Group, another major private prison company that works for Immigration and Customs Enforcement is called CoreCivic, another Trump stock that did very well.
Both GEO and CoreCivic have faced similar cases elsewhere. In the case of GEO, there’s a suit in California that’s also before the 9th Circuit. And that is pending to see what the outcome of this one is that we’re talking about. There’s also a case in Colorado that is probably bound for the 10th Circuit. And especially if the Colorado case goes differently than what happens in the 9th Circuit, we could see this go straight to the Supreme Court. That is what observers believe is that eventually the Supreme Court is going to have to weigh in and say, can states impose their minimum wage on these facilities, because as of now, the federal government will not. And the federal government seems to be OK with paying people $1 a day also.
Miller: McKenzie, thanks very much.
Funk: Thank you.
Miller: That’s McKenzie Funk, a reporter for ProPublica. He wrote recently about the GEO Company, which runs the immigration detention facility in Tacoma. It is appealing a ruling that found that it cannot pay detainees who work there less than the state minimum wage.
Contact “Think Out Loud®”
If you’d like to comment on any of the topics in this show or suggest a topic of your own, please get in touch with us on Facebook, send an email to thinkoutloud@opb.org, or you can leave a voicemail for us at 503-293-1983. The call-in phone number during the noon hour is 888-665-5865.