EMPLOYER’S OBLIGATION TO COMPLY AND POTENTIAL PENALTIES Violations of the IRCA can result in both civil penalties and criminal charges for employing unauthorized workers. The IRCA authorizes escalating monetary fines to the employer per unauthorized worker identified and per Form I-9 paperwork violation. A company may also be barred from competing for government contracts in the case of a knowing violation of law. There are several additional statutory provisions for criminal charges to be brought, but as one example, employers that assist in the production and use of false documents to obtain employment eligibility are subject to fines in excess of $10,000 per offense and up to fifteen years imprisonment. Non-owners, such as HR Managers, Plant Managers or Corporate Officers, may also be held liable for playing a role in any falsification of documents. By implementing policies on preparing for an ICE audit or raid, as well as employment eligibility verification, employers can ensure that they are in compliance with applicable statutory requirements and that their workforce is properly equipped to address any visit from a law enforcement agent. Challenges and Opportunities for Manufacturers in Today’s M&A Environment Contributor: Frank Pellegrino In today’s M&A environment, manufacturers face strong buyer demand from both private equity and strategic acquirers, but also contend with inflation, supply chain disruptions, labor shortages, high interest rates, and evolving trade policies that complicate deal valuations and execution. To navigate this landscape, sellers must engage in a disciplined, well- prepared process—often beginning six to nine months before going to market—to withstand heightened scrutiny from buyers and lenders, compress deal timelines, and preserve execution certainty. Deal structures should include protections like working capital collars or locked-box mechanisms to address cost volatility, and seller financing or rollover equity—with appropriate safeguards such as secured notes and tag-along rights—can support pricing while managing post-closing risk. Earn-outs based on objective financial metrics and shorter time frames can help bridge valuation gaps, while representation and warranty insurance, along with capped indemnities and defined survival periods, mitigate exposure to regulatory and supply chain risks. Manufacturers should also plan carefully around tax outcomes and remain agile in response to potential tariffs or trade barriers that could impact future profitability. For a deeper analysis, see the article by Frank Pellegrino of Bass, Berry & Sims, “Challenges and Opportunities in Today’s M&A Environment,” available at Industry Today.
How New Markets Tax Credits Can Benefit Manufacturers Contributor: Michael Bradshaw
For almost twenty-five years, New Markets Tax Credits (NMTCs) have proven to be a valuable tool in promoting economic development throughout the United States. Designed to stimulate private investment in economically distressed and low-income communities, NMTCs generally provide a net subsidy of 15% to 20% for projects in certain designated census tracts. NMTCs have provided gap financing for a variety of worthy development projects including hospitals and other medical facilities, educational institutions, retail and commercial facilities and mixed-use projects. In addition to the aforementioned projects, NMTCs have also been used to finance the construction and expansion of manufacturing and industrial facilities, as well as their operations.
4 MANUFACTURING & INDUSTRIAL: OUTLOOK & TRENDS |
Powered by FlippingBook