Federal Court Decision Could Mandate Minimum Wage for ICE Detainees
A pivotal legal case may soon determine whether private prison firms managing U.S. Immigration and Customs Enforcement (ICE) detention centers must adhere to state minimum wage laws for detainees participating in voluntary work programs. This decision could have sweeping implications for the operations and financial structures of these facilities.
Since the election of Donald Trump in 2024, the spotlight has intensified on private entities running ICE detention centers. Trump’s administration has prioritized deporting “millions and millions” of undocumented migrants, leading to ICE facilities operating at 109 percent capacity. However, a less publicized but crucial legal battle is unfolding involving GEO Group, a private prison company, which is appealing a ruling that it should have compensated detainees at the state minimum wage for voluntary work.
GEO Group operates the Northwest ICE Processing Center in Tacoma, Washington, a facility with 1,575 beds and ranked as the fourth-largest immigration detention center nationwide. In 2021, a jury ordered the company to pay $17.3 million in back wages to detainees, who were paid $1 per day for tasks like kitchen work and maintenance. Additionally, $6 million was awarded to the state for unjust enrichment claims against GEO Group.
The legal contention centers on whether GEO Group, as a federal contractor, is bound by Washington’s minimum wage laws or if these are overridden by federal preemption and intergovernmental immunity principles. The company argues that the application of state law violates the U.S. Constitution’s Supremacy Clause, which prioritizes federal statutes over state regulations.
The Ninth Circuit Court of Appeals upheld the decision that state minimum wage laws should apply to all private employers within the state. If this ruling stands, it could impose significant financial obligations on firms managing federal detention centers, contrasting with state-run facilities, which are exempt from such wage laws for detainees.
GEO Group’s legal challenge is not isolated to Washington; similar lawsuits are pending in California and Colorado. These cases could potentially reach the Tenth Circuit Court of Appeals, and differing outcomes between circuits might prompt the U.S. Supreme Court to intervene. Historically, the Ninth Circuit has had a high reversal rate, although the most recent term saw a 50 percent reversal in cases reviewed by the Supreme Court.
The resolution of this legal dispute could influence other federal contractors, such as CoreCivic and LaSalle Corrections, which manage a significant portion of ICE detention centers. Should the courts mandate minimum wage payments, these companies might seek to pass increased operational costs onto the federal government during contract negotiations, potentially elevating government expenses for managing immigration detention.
