CNN — LOU DOBBS TONIGHT — Aired October 2, 2007 - 18:00 ET

KITTY PILGRIM, GUEST HOST: A new measure to crack down on employers of illegal aliens was put on hold again last night. A federal judge extended the delay of a proposed rule change by the Department of Homeland Security for another 10 days. Now, the new rule would increase penalties on employers who keep illegal aliens on the payroll.

(BEGIN VIDEO TAPE)

PILGRIM (voice-over): For years, the Social Security Administration has sent out so-called "no-match" letters. But a proposed DHS rule change would now inform employers they have 90 days to clear up discrepancies or face fines and possible charges.

A lawsuit was filed by the ACLU and a coalition of labor and immigrant advocacy groups. Lawyers for the plaintiffs say the rule is discriminatory and DHS is putting an unfair burden on employers.

LUCAS GUTTENTAG, ACLU ATTORNEY: The Department of Homeland Security is trying to create a legal liability out of the "no-match" letters that does not exist and that we don't believe can legally be imposed by changing the rule. It's not authorized by Congress. It's not part of the statute. And DHS does not have the authority to hijack the Social Security system to turn it into an immigration enforcement scheme.

PILGRIM: But the government argues that the rule would give employers more than adequate time to ensure they're following laws already on the books.

TOM DUPREE, DEPUTY ASSISTANT ATTORNEY GENERAL: This is a rule that provides much needed guidance and clarity to employers who want to comply with the law and who want to understand their obligations when they receive a "no-match" letter. This rule serves that purpose.

PILGRIM: The updated "no-match" letters were supposed to start going out last month. The government has 140,000 letters ready to mail employers as soon as the judge grants permission.

(END VIDEO TAPE)

PILGRIM: Congressman Ted Poe is a strong supporter of toughening our laws on illegal immigration. And he asks, since it's already illegal to hire illegal aliens, why is this case even in court? Well, Congressman Poe joins me now from Capitol Hill. Thanks for being with us, sir.

REP. TED POE (R), TEXAS: Thank you, Kitty.

PILGRIM: You know, Judge Charles Breyer said that employees -- it would cause irreparable harm to enforce this. What do you think about it? You're a former judge yourself.

POE: Irreparable harm means that somebody is going to jail for hiring illegals. It's been against the law for years for employers to knowingly hire illegals. Homeland Security now is basically telling the employers, we're going to enforce the law, you're going to have to pay fines if you hire illegals. And now we have a federal judge saying nope, don't tell the employers that, and basically preventing the enforcement of an old law against employers.

PILGRIM: You know, I'd like to get your comments on a detail of this. The ACLU says DHS doesn't have a right to the Social Security Administration data. Now, the way this works is a letter goes out and says you have a "no-match" and a DHS notice accompanies the letter.

That's not sharing data yet, is it?

POE: That is not sharing data. And what happens is the Social Security Administration, if they get so many of these "no-match" from employers, they do notify Homeland Security and then Homeland Security does get involved and says, look, this could be used against you in court. They're putting them on notice. You've got 90 days to figure out what the problem is with this employer or employee, fire them if they're illegally in the country. And because of that, now a federal judge says, basically, do not enforce the law, do not hold employers accountable for knowingly hiring illegals. This is absurd.

PILGRIM: You know, this 90 days -- here's what the AFL-CIO said after the ruling. I'd like to read it to you. Go ahead and we'll listen.

(BEGIN VIDEO CLIP)

SCOTT KRONLAND, LAWYER FOR AFL-CIO: The department is seeking to impose new obligations on employers to re-verify employees. And we contend that the department does not have the legal authority to do that.

(END VIDEO CLIP)

PILGRIM: New obligations -- it's always been the obligation of an employer to verify that the Social Security matches the employee, correct?

POE: No question about it. They have an ongoing duty to make sure that the people they hire have a name -- that name matches Social Security numbers. It has been the law. Members of Congress have notified Homeland Security that they have the authority under the law to go ahead and let these employers know that they could be prosecuted. They have the authority to do that. We've got a federal judge that says, no, you can't do anything about illegal immigrants. And, once again, we have those who pander to the cheap plantation labor getting their way in court, to the detriment of the United States.

PILGRIM: Let's talk about someone who is here legally. If they find out their Social Security doesn't match their name because of a typing error or a misspelling, some failure to change the name after becoming married or something, it's to their benefit to have this straightened out, isn't it?

This does not penalize people who are here legally who are working legally.

POE: That is correct. It doesn't penalize people who are here legally. It doesn't penalize American citizens who, for, as you mentioned, changed their names.

Homeland Security is telling these employers, you've got a mismatch here. Figure out what the problem is and if the person is illegally in the country, you could be fined for hiring this person. Otherwise, correct the mistake with the Social Security Administration.

So I think putting them on notice is a good thing. And they shouldn't be -- the Homeland Security certainly shouldn't be prohibited from prosecuting people who continue to hire illegals.

PILGRIM: Congressman Ted Poe, thank you very much for coming on the program tonight.