Senate Votes To Bar Companies Hiring Illegals From Federal Contracts

WASHINGTON (Dow Jones)–The U.S. Senate on Thursday voted unanimously to bar companies that hire illegal immigrants from receiving federal contracts.

The ban would last for seven years and would last 10 years if the company was caught hiring illegal immigrants while it already held a federal contract.

The ban could be lifted if the government decided that doing so was in the interest of national security.

The amendment was offered on the fourth day of Senate debate on an increase in the federal minimum wage from $5.15 an hour to $7.25. The House passed its version of the minimum wage bill, by a 315-116 margin, earlier this month.

A final vote by the Senate on the bill could come next week, but Republicans are first forcing Democrats to consider a series of amendments. As of Thursday afternoon, Republicans had prepared 70 proposed revisions.

Earlier Thursday, Democrats and Republicans joined forces to defeat an attempt to force a minimum wage increase in all states, including those that are already at or near $7.25 an hour. The amendment would have effected 28 states.

The amendment’s author, Sen. Jim DeMint, R-S.C., said he offered it because the underlying bill “does not raise the minimum wage for all workers.”

DeMint opposes the minimum wage increase, arguing that mostly teenagers earn the minimum wage and that adults earning the minimum wage are in need of better job training or other help, not a raise.

The minimum wage bill’s author, Sen. Edward Kennedy, D-Mass., called the amendment a “poison pill.”

Kennedy said it was intended “give senators in high minimum wage states an uncomfortable vote today not to raise wages for hardworking Americans.”

The amendment was defeated, 78-16.

The Senate also defeated an effort to expand a tax break for restaurants and retail stores also included in the minimum wage bill.

The provision would allow retailers and restaurant owners to more quickly write off the costs of remodeling leased buildings.

The amendment by Sen. Jon Kyl, R-Ariz., would have extended the break’s expiration date from March 31, 2008, to Dec. 31, 2008.

The proposal generally enjoyed bipartisan support but it was how Kyl offered to pay for it that led to its defeat.

Kyl proposed offsetting the cost of his proposal by eliminating the tax exemption for free education benefits given school employees.

Sen. Max Baucus, D-Mont., said it would be unfair to change the law “midstream” for employees who had taken jobs at educational institutions with the tax-free benefit in mind.

By John Godfrey, Dow Jones Newswires