Meanwhile and state legislators and a union representing the workers say the raids exposed flaws in a federal program designed to help employers screen for illegal immigrants and avoid liability.
The raids -- and the costs -- have left many other meat processors wondering if they are next. The meat and poultry processing sectors are major employers of immigrant workers.
Swift, which claims to be the world's second-largest meat processor of fresh beef and pork, was the target of a federal immigration raidon December 12 at plants in Iowa, Texas, Colorado, Nebraska, and Minnesota. About 1,300 workers werearrested and taken out of the Swift workforce.
In a surprise statement this week the company said it has engaged JP Morgan to assist in a reviewof operations, which Swift said was initiated as a result of a series of " unsolicited inquiries" over the past six months. Swift'smajority shareholder is HM Capital Partners.
"In the review process the Swift board will consider the full range of possible alternatives, including, among others, a possible sale, merger, strategic partnerships, refinancing and/or public equityoffering," the company stated in a press release.
In its latest financial report Swift estimates the raids and the subsequent loss of employeeswill lead to costs of $20m resulting primarily from lost operating efficiency as new employees areretrained. The company also expects to spend an additional $10m on employee retention and hiring incentives,which is required to restaff the facilities with production employees.
The raids forced the company to suspend operations for up to seven hours as employees were interviewedby federal agents. Swift resumed production at all facilities but at reduced output levels, which are expected to be below historical levels over the nearterm, the company said in its fiscal second quarter report.
About 1,300 individuals were arrested by the federal immigration officials and removed from Swift's domestic laborforce, the company. No civil or criminal charges have been filed by the government against Swift or any of its current or former managementemployees, the company said.
Since the arrests, federal attorney general Alberto Gonzales said 148 allegedly illegalimmigrants have been charged with using other peoples' Social Security numbers and other personalinformation to get jobs at Swift.
In related news the United Food and Commercial Workers (UFCW) union accused Swift and othermeatpackers of exploiting immigrant workers by abusing a federal immigration program aimed athelping them ensure they have only legal employees on their books. The UFCW represents 1.4 millionworkers in the US, of which 250,000 work in the meatpacking and poultry industries.
" They are innocent victims in an immigration system that has been hijacked by corporations for the purpose of importing an exploitableworkforce," the UFCW said about the arrested workers.
The federal government's Basic Pilot Program is an Internet service that allows eligibleemployers to check on the immigration status of their workers. It provides an automated link to theSocial Security Administration database and federal immigration records. Employers who uses the pilotcannot be held liable for hiring an illegal worker. Participation in the program is voluntary.
The UFCW alleges that the pilot serves to absolve companies who hire illegal workers and allowsthem to fire them at will.
"These companies lure undocumented immigrants to the U.S. to create a low-wage, disposable workforce in thiscountry," the union said in a statement. "They advertise for workers outside U.S. borders. They utilize labor contractors. They use current workers to recruit more workers. They pay immigrants less, offer fewer benefits, and threaten them with deportation if they stand up for better wages, working conditions, or try to organize a union."
Swift noted that its pay its US production employees more than twice the federal minimum wage,and offers " affordable and comprehensive health care benefits, and possesses industry-leading employee safetyrecords".
The UFCW has called for comprehensive immigration reform that protects worker rights, ensures good wages and benefits, and recognizestheir contributions. Meanwhile senators in the affected states this week said they plan to introducelegislation to fix some of the problems with the Basic Pilot Program.
Swift employs about 500 workers at its Greeley corporate headquarters, an additional 14,500 at otherUS locations, and a total of 20,000 worldwide.
Swift has about $9bn in annual sales. The company has beef and pork processing plants in six states and an operation inAustralia. Earlier this month the company reported net sales of $2.47 billion for its fiscal second quarter ended November 26, 2006, up 6.9 percent from net sales of $2.31 billion in the comparable prior-year period.
The company registered a operating loss of $18 million for its beef division, while operatingprofits at its pork business remained flat at $26 million. Swift Australia's second-quarteroperating profit increased to $25 million from $6 million over the comparable periods.
Last week Swift announced the launch of a programme to shave up to $15m in overhead costs.