By Mandy Miles and Sara Matthis

A recent federal investigation and indictment of contractors who hire foreign workers and get them jobs in American hotels and restaurants has led to crippling shortages at Florida Keys hotels and restaurants that rely on these workers.

A press release from the U.S. Department of Justice last week announced the federal indictment of “three men who operated labor-staffing companies in Florida with conspiracy to harbor non-resident aliens and induce them to remain in the country and with conspiracy to commit money laundering.

“According to the indictment, Mykhaylo Chugay, Oleksandr Morgunov, Volodymyr Ogorodnychuk and others owned and operated a series of labor-staffing companies in southern Florida … between August 2007 and July 2021.

“The indictment charges that the defendants, through these staffing companies, facilitated the employment in the hospitality industry of non-resident aliens who were not authorized to work in the United States,” the press release states.

In other words, these labor-staffing companies are accused, but not yet convicted, of hiring illegal aliens who are not allowed to work in the United States, and getting them jobs in hotels and restaurants.

As a result of the indictment, the targeted staffing companies — and others concerned about similar legal actions — shut down, leaving hundreds of illegal workers without income and often without their employer-provided housing. 

“It’s a bad situation with some of these labor-contracting companies. But it’s a bad situation that’s absolutely necessary,” Jodi Weinhofer, president of the Lodging Association of the Florida Keys & Key West, told the Keys Weekly on Aug. 20. “I know that during COVID, two local contract labor companies left the Keys or moved to the mainland. And I heard today that another contract labor company is leaving or out of business. This couldn’t possibly come at a worse time. Between losing contract workers and COVID, I don’t know how businesses are doing it.”

One employee of an affected Marathon resort, who wished to remain anonymous, told the Keys Weekly she and her husband are each missing three paychecks representing a month and a half of work at $13 an hour. The couple, who are not U.S. citizens, have been on the housekeeping team for seven months and said all the housekeepers were affected. 

“At a meeting on Aug. 19, the resort said they would try to pay us back for at least one paycheck,” she said. 

According to one Key West business owner who has dealt with the federal investigations, the business owner can be held responsible for two or three years of back pay to such workers, even if the owners were assured by a contracting company their workers were all legal.

The Marathon employee said when she signed with the labor agency they didn’t explain U.S. labor laws nor ask her for any identification or proof of her eligibility to work in the United States.

Another employee, speaking from a balcony of a Marathon resort’s employee housing compound on Aug. 19, said she doesn’t know what she’ll do next, and added that most of the employees in the workforce housing complex had already moved out, although she had understood that the deadline to do so was Aug. 23.

A mid-level hotel manager of one of the Marathon resorts said nearly 95% of the employees at the Marathon resort were contract laborers, and another property is probably down 40% of its employees. “I know I will be cleaning toilets tomorrow,” that person said. 

The situation has left dozens of Keys hotels without housekeepers, dishwashers and other crucial positions, prompting a string of increasingly negative reviews on travel websites such as TripAdvisor.

A review posted on Aug. 20 about a Marathon resort is titled “Legal issues” and states in part, “…We went for dinner and were turned away due to no table seating, so we had to eat off-property every night. The service was unacceptable for a four-star resort. It was obvious they were understaffed, trying to tell you it’s due to COVID. … But on our last day at the resort we overheard two employees talking about having to send home 90% of their staff because they were illegal immigrants because they ran into legal issues. … Now there is absolutely no staff at this resort. Please don’t be conned into coming here because you won’t get any service of the sort.”

Another recent review of a Key West resort describes similar shorthandedness, saying the resort, “…was a massive disappointment. We absolutely refused to spend one night in this hotel. At check-in we were told housekeeping had been suspended during the stay. Pardon? We are paying $600 a night. So, should we need additional towels, the front desk would provide them. …The floor was littered with crumbs, a couple of peanuts, bits of paper, and an actual wadded-up tissue. The front desk said they must’ve forgotten to ‘hit it with a vacuum.’ Ummm, okay….” 

The thorny situation has existed quietly for decades in the Florida Keys and other tourist destinations. Business owners and managers depend on the workers these labor-staffing companies provide, but they have no access to the workers’ immigration status or verification. In most cases, the business owners don’t even have a worker’s address or phone number, and are always directed to call the staffing company with any questions or concerns, Weinhofer said.  But ignorance of a worker’s illegal immigration status is not an acceptable excuse, and business owners share the responsibility — and potential penalties — of employing illegal workers. 

Business owners can be made to pay fines and/or two to three years of back pay.

“I don’t know what we’re going to do if we can’t get legal contract labor here,” Weinhofer said.

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