Bender Legal Editor Summarizes High Court's Ruling On Legal Arizona Workers Act

Chamber of Commerce of the United States v. Whiting, 563 U.S. ___ (May 26, 2011): The Legal Arizona Workers Act, requiring all Arizona employers to use E-Verify and suspending or revoking the business licenses of employers who knowingly or intentionally hire unauthorized aliens, is valid under the Immigration Reform and Control Act.

INA §274A, 8 U.S.C. §1324, as added by the Immigration Reform and Control Act of 1986, outlaws the employment of aliens not authorized to work in the United States. It also bars "any State or local law imposing civil or criminal sanctions (other than through licensing and similar laws) upon those who employ ... unauthorized aliens." Following IIRAIRA, what is now DHS instituted the program today called E-Verify, an Internet-based way to confirm the work eligibility of employees. With some exceptions, IIRAIRA prohibits the federal government from making enrollment in E-Verify mandatory. On the other hand, use of the program creates a rebuttable presumption against a charge of violating IRCA.

In 2007, Arizona enacted the Legal Arizona Workers Act, which among other things (1) provides for suspension or revocation of licenses of businesses that knowingly or intentionally employ unauthorized aliens and (2) requires employers to use E-Verify. Showing use of E-Verify creates a rebuttable presumption of not knowingly violating the LAWA. Several organizations sued to prevent enforcement of the LAWA. The trial court ruled for the State, holding that IRCA did not preempt state action. The Ninth Circuit agreed and affirmed. The challengers sought and obtained certiorari from the U.S. Supreme Court.

The Supreme Court (opinion by Chief Justice Roberts, joined in full by Justices Scalia, Kennedy, and Alito, and in Parts I, II-A, and III-A by Justice Thomas, who concurred in the judgment) upheld the law. Part I gave the background.

In Part II-A, the Court held that the LAWA fell within the "licensing and similar laws" exception of IRCA. It rejected the arguments (1) that the LAWA was not truly a licensing law, (2) that IRCA's amendment of the Migrant and Seasonal Agricultural Worker Protection Act showed that Congress wanted state licensing sanctions to follow an IRCA decision, not precede it, and that Congress wanted uniformity amongst the States, and (3) that States can sanction only based on AWPA licenses. It also rebuffed the argument based on legislative history, finding the text clear.

In Part II-B, the Court rejected the argument of implied preemption for conflicting with what was to be an exclusively federal enforcement program. It reasoned that Arizona was just implementing explicitly allowed sanctions. Moreover, the Court pointed out that Arizona had ensured that the LAWA "closely tracks IRCA's provisions in all material respects." The challengers tried to show that the LAWA upset the balance Congress struck among policies in IRCA, but the Court explained that the cases cited were in "uniquely federal areas of regulation" - unlike licensing in-state businesses - and involved "state actions that directly interfered with the operation of the federal program." The Court saw "little sense" in preserving the full state sanctioning power except for the sanction of revocation. It also discounted the likelihood of discrimination so as to avoid the "business death penalty."

Moving to Part III-A, the Court observed that IIRAIRA limits only the Secretary of Homeland Security's power, not state power. It pointed to a 2008 argument by the United States that called LAWA's E-Verify mandate permissible. The Court considered the LAWA to be consistent with the federal scheme. In Part III-B, the Court stated that Arizona's mandate did not obstruct the congressional objectives "to ensure reliability in employment authorization verification, combat counterfeiting of identity documents, and protect employee privacy." It cited DHS statements encouraging more use of E-Verify.

Justice Breyer (joined by Justice Ginsburg) dissented. He considered the LAWA concept of a license too broad for the IRCA exception. He contended that the law upset Congress's balance and would increase discrimination. He would have limited "license" to licenses of recruiting and referring businesses. He also objected to Arizona making mandatory what federal law wanted to be voluntary (E-Verify). He observed that E-Verify was still a pilot program. In sum, he believed that the LAWA was preempted.

Justice Sotomayor also dissented. She construed the licensing exception to allow sanctions only after a final federal determination that the employer knowingly employed an unauthorized alien. Therefore, the LAWA was preempted. She also considered Arizona's making E-Verify mandatory to be invalid because it contravened the congressional determination that the program should be voluntary.

Justice Kagan did not participate.

NOTE: For more on this subject, see Charles Gordon, Stanley Mailman, and Stephen Yale-Loehr, Immigration Law and Procedure §§7.03, 7.06; Ben Stanley, Federal Appeals Court Decisions Do Little to Resolve Permissibility of State and Local Laws Mandating E-Verify Use, 15 Bender's Immigr. Bull. 1403 (Oct. 15, 2010).

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