Arizona Employers Face Possible Sanctions For Hiring Unauthorized Workers:

Supreme Court Validates Law Imposing Licensing Sanctions on Employers who Hire Unauthorized Aliens and Requires Employers to Use the E-Verify System.

The Supreme Court recently upheld an Arizona law in Chamber of Commerce of the United States v. Whiting that imposes licensing sanctions on state employers who hire unauthorized aliens and which also requires state employers to participate in a federal electronic employment verification system.

The state law in question is the Legal Arizona Workers Act (“LAWA”), which allows Arizona courts to suspend or revoke a state employer’s business license if it knowingly or intentionally hires an unauthorized alien.  LAWA also requires that all Arizona employers use the federal electronic verification system, E-Verify, to confirm the work authorization status of new employees.

The Chamber of Commerce, as well as various civil rights and business organizations, questioned the validity of LAWA and charged that the federal Immigration Reform and Control Act (“IRCA”) invalidated certain provisions of the Arizona law.

IRCA makes it illegal for an employer to hire for employment, recruit or refer for a fee any individual they know is an unauthorized alien.  An unauthorized alien is a person who is not a U.S. citizen, not a permanent resident, and not otherwise authorized to work in the United States under federal law.

An employer who violates IRCA may be subject to both civil and criminal sanctions.  IRCA further prevents a state law from imposing similar sanctions on those who employ unauthorized aliens but it does allow states to impose sanctions “through licensing or similar laws.”

In Whiting, the Supreme Court found the Arizona law to be a licensing law and therefore not expressly prohibited by IRCA.  With the Supreme Court upholding LAWA, it is important for employers to understand and comply with the law’s provisions.

How does this affect your business?

To comply with the state law, an Arizona employer may not hire an unauthorized alien as an employee or an independent contractor.  In addition to these restrictions, every employer in Arizona is required to use the federal E-Verify program to confirm the employment eligibility of all newly hired employees.  Lastly, sanctions result from knowing or intentional violations of the law.  So long as an employer acts in good faith compliance with the law, they would most likely not face sanctions.  However, it is important to consult with counsel prior to making any hiring decisions that may implicate these laws.

If you are an Arizona company, or if your state has passed a similar law, please contact us for more information at so we may ensure you do not face unnecessary sanctions.


For more information on the Legal Arizona Workers Act please visit

For the Supreme Court ruling in Chamber of Commerce of the United States v. Whiting please visit

To register for E-verify please visit