Court Upholds Arizona's Employer Sanctions Law

A federal appeals court upheld an Arizona law that penalizes businesses that knowingly hire illegal immigrants and requires them to verify the employment status of their workers. A three-judge panel of the United States Court of Appeals for the Ninth Circuit rejected a challenge by business and Hispanic groups who contend that the law infringes on federal powers. The law, intended to lessen the economic incentive for immigrants to sneak into the country, imposes civil penalties on employers by suspending or revoking their business licenses when they are found to have knowingly hired illegal immigrants. A lower court judge upheld the law in February, before it took effect.

Arguments against the the law rested on the requirement of employers to verify workers using a verification system - e-verify system (Basic Pilot Program). However, U.S. federal law states that this process is voluntary. Opponents argued that by requiring Arizona employers to use the Basic Pilot Program program, the Legal Arizona Workers Act runs afoul of the Constitution and subjected all Arizona employees regardless of legal status - Latinos in particular - to potential discrimination based on their race, ethnicity, or national origin. They also argued that the state law also violated the Constitution's 14th Amendment because it deprived workers of due process.

The law is one of the toughest in the nation. However, this ruling could have drastic consequences for small businesses and workers in the area. Small business have found it increasingly difficult to find workers. The Arizona Department of Commerce does not keep records about how many companies have transferred business to Mexico, but some owners say the trend likely will increase because of the new law.