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Lawsuit Challenges Arizona’s Employer Sanctions Law

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Immigrants' Rights Update, Vol. 21, Issue 8, October 5, 2007

Lawsuit Challenges Arizona’s Employer Sanctions Law as Being in Conflict with Federal Law

By Karen Tumlin
NILC Skadden Fellow

A lawsuit filed in a federal court challenges Arizona’s new law that creates a state scheme of penalties for employers that hire unauthorized workers, even though these employers have complied with the applicable federal law.  The Legal Arizona Workers Act (HB 2779) mandates every employer in the state to join a temporary and voluntary federal program, the Basic Pilot program (recently renamed “E-Verify”) to verify the employment eligibility of each new hire.  In addition, the Arizona law threatens employers with permanent loss of business licenses based on new, invalid state requirements.

The lawsuit was brought in Arizona on behalf of two organizations in the state, Chicanos Por La Causa (CPLC) and Somos America, which are concerned that the law will adversely impact Arizona workers and employers.  CPLC, one of the state’s largest nonprofit employers, expressed concern about the law’s requirements on it as an employer and also about the harmful and discriminatory impact the law would have on its employees, particularly foreign-born workers and workers of color.  Specifically, CPLC alleges that as a result of the law, foreign-born workers and other workers of color will be less likely to be hired, more likely to lose their jobs, and in many cases will need to take additional steps to prove their employment eligibility.  CPLC also is concerned that it will have to divert resources from its programmatic work in order to assist workers in the state who are harmed by the new law.

If implemented, the new law will drastically increase the number of employers using the federal Basic Pilot/E-Verify program, a deeply flawed program that far too often produces erroneous results, even at its current relatively low level of participation.  Basic Pilot/E-Verify has been plagued by problems, including failing to identify legally authorized workers due to its reliance on the error-ridden databases of the Social Security Administration and the U.S. Dept. of Homeland Security (DHS), and the DHS’s lack of resources to monitor employer compliance with the program’s rules.  (For more on the program’s problems, see Basic Pilot/E-Verify: Not a Magic Bullet (Sept. 2007).)  Currently, the program is set to expire in 2008, and nationwide only about 23,000 employers are registered to use it.  Moreover, many of these may not actually be using the program.  Earlier this year, DHS reported that 17,000 employers were using Basic Pilot/E-Verify but that only half were active users.  If implemented beginning Jan. 1, 2008, as scheduled, the Arizona law would require an estimated 150,000 Arizona employers to join Basic Pilot/E-Verify, an infusion of new participants that can only exacerbate the already troubled program’s serious deficiencies.

The lawsuit challenges the Arizona law as an unconstitutionally preempted regulation of immigration in violation of the Supremacy Clause of the U.S. Constitution.  The power to regulate immigration is an exclusively federal power.  Because the federal government has established a comprehensive system of laws and procedures relating to the employment of immigrants, state attempts to regulate this area, including state attempts to create penalty schemes for employers that violate federal law, are preempted.  The state law’s requirement that employers use Basic Pilot/E-Verify, a program that, as authorized by Congress, is voluntary and temporary, runs afoul of the Constitution.

The Arizona law is an attempt to override national law and policy on the employment of immigrants, which carefully balances the national interest and includes substantial antidiscrimination protections for foreign-born and national origin minority workers.  State employer sanctions policies, such as Arizona’s, lack this careful balancing embodied in the federal law.  Should laws such as Arizona’s be allowed to stand, state lawmakers across the country would feel themselves empowered to construct immigration laws for their own states, resulting in diminished antidiscrimination protections for noncitizen workers.  For example, the Arizona law creates perverse incentives for employers to discriminate against workers who they believe “appear foreign” rather than risk the fines and penalties associated with a failure to comply with this law.  If the law is allowed to take effect, many employers will fire workers they believe to be foreign or refuse to hire them in the first place out of fear that these workers are more likely to put the employer at risk for sanctions under the state scheme.

The lawsuit also challenges the state law as a violation of the Constitution’s 14th Amendment because it deprives workers and employers of liberty and property without due process of law.  The state law requires the Arizona attorney general or county attorneys, as appropriate, to investigate all complaints that an employer is knowingly or intentionally employing unauthorized noncitizen workers.  Under this provision, the attorney general or a county attorney would be required to attempt to verify the suspect workers’ employment authorization by using a federal inquiry procedure outlined in 8 U.S.C. sec. 1373(c), a procedure that has the capacity to verify only the immigration status, but not the employment authorization status, of individuals.  The law, however, does not require that any notice of this investigation be given to the affected employer or employee.  If, after investigating, the attorney general or county attorney finds that the employer knowingly or intentionally hired unauthorized workers, a penalty established by the state law may be imposed, which may include denying the employer the ability to operate a business and requiring that the identified workers be fired.  By contrast, Congress put in place a much more stringent system for determining whether employers have knowingly hired unauthorized workers.  In addition to being federally preempted, Arizona’s deficient scheme violates due process.  Quite simply, due process requires more procedural protections than the Arizona law affords before denying employers the ability to operate a business and lawful employees the ability to work.   

On Sept. 4, NILC and its co-counsel filed a motion for a preliminary injunction to stop the state from implementing the state law when it is scheduled to take effect, on Jan. 1, 2008.  In addition, NILC sought to stop the state from mailing letters on Oct. 1, 2007, to every state employer describing the act’s requirements, including that each employer in the state join Basic Pilot/E-Verify.

On Sept. 14, 2007, Judge Neil V. Wake consolidated the lawsuit brought on behalf of Chicanos Por la Causa and Somos America with a separate lawsuit brought by a coalition of business and trade associations, Arizona Contractors Association v. Napolitano (D. Ariz, filed July, 2007).  (For a copy of the complaint in this case, click here.)  The lawsuit filed by the trade association plaintiffs also alleges that the state law is federally preempted and violates due process.  In addition, this lawsuit includes claims that the law violates the Commerce Clause of the U.S. Constitution, separation of powers under the Arizona Constitution, and the Fourth Amendment’s protection from unreasonable search and seizures.  At the Sept. 14 hearing, Judge Wake declined to set a schedule that would allow the court to decide on the plaintiffs’ preliminary injunction motion before the October letter-mailing.  Instead, the judge set a briefing schedule to decide the plaintiffs’ preliminary injunction motions along with the merits of the case.

The lawsuit on behalf of CPLC and Somos America was filed jointly by the law firm of Altshuler Berzon, the American Civil Liberties Union (ACLU) of Arizona, the ACLU Immigrants’ Rights Project, the Mexican American Legal Defense and Educational Fund (MALDEF), and NILC.  The legal team is comprised of Stephen Berzon and Jonathan Weissglass of Altshuler Berzon; Daniel Pochoda of the ACLU of Arizona; Lucas Guttentag, Jennifer Chang, and Omar Jadwat of the ACLU Immigrants’ Rights Project; Kristina Campbell and Cynthia Valenzuela of MALDEF; and Linton Joaquin, Monica Guizar, and Karen Tumlin of NILC.

Chicanos Por La Causa, Inc. v. Napolitano,
No. 07-cv-01684 (D. Ariz, filed Sept. 4, 2007).