In 2007, the state of Arizona made its first foray into “immigration reform” when it passed the Legal Arizona Workers Act. However, before the Legal Arizona Workers Act (LAWA) even became effective on Jan. 1, 2008, the Legislature went to work on amending the statute, presumably to “cure” some of the more controversial aspects of the law.
While the fundamental purpose and structure of LAWA has not changed, employers need to be aware of the current version of the law in order to limit the chances of being on the receiving end of an enforcement action. For example, the same legislation that tweaked LAWA also criminalized the act of knowingly accepting identity information from someone who is not actually the person represented in that identity information. Nevertheless, recent trends reported by a researcher from the University of Arizona suggest the enforcement tsunami that was expected to hit the business community is, up to now, little more than a ripple in a pond.
LAWA prohibits employers from “knowingly” or “intentionally” employing any unauthorized alien workers after 2007, and creates stiff penalties for employers who do. Penalties for first violations include mandatory probation for, and possible temporary suspension of, all business licenses issued by the state of Arizona. For a second violation during the probationary period, whether knowing or intentional, employers face permanent revocation of their state-issued licenses — thus effectively preventing the employer from doing business in Arizona. LAWA also requires every Arizona employer to verify new hire work eligibility through the federal government’s E-Verify system. However, LAWA created no “penalty” for failure to use E-Verify. So an employer who becomes the target of an enforcement action will likely be presumed to have “knowingly” hired an undocumented worker if that employer failed to use E-Verify. Evidently, most employers have decided either to roll the dice or they simply don’t recognize a risk. According to Department of Homeland Security data, as of late August 2008, only 5.6 percent of Arizona employers have enrolled in E-Verify.
Non-participation in E-Verify is not an option for contractors and subcontractors of any Arizona governmental entity. The LAWA amendments passed last year require those employers to participate in E-Verify as a condition of their government contract. In fact, any Arizona governmental entity (state or any political subdivision) would be prohibited from awarding a contract if the contractor or subcontractor does not comply with federal immigration laws and E-Verify requirements. LAWA requires government entities to ensure that their contractors comply with those requirements, and to include the following terms in their contracts:
- Each contractor or subcontractor must warrant their compliance with LAWA’s provisions.
- A breach of that warranty is to be deemed a material breach of the contract, subject to penalties up to, and including, termination of the contract.
- The government entity retains the legal right to inspect the papers of the contractor and subcontractor employees who work on the contract in order to ensure compliance with the warranty.
Also, employers seeking to obtain an economic development incentive from a government entity must first register for and participate in E-Verify, and show proof of doing so. LAWA further requires the Attorney General’s office to, on a quarterly basis, request a list of Arizona employers registered with E-Verify from the Department of Homeland Security. The Attorney General must make that list available to the public on its Web site.
So far, enforcement actions against employers have been anemic at best. Judith Gans, manager of the Immigration Policy Program at the University of Arizona’s Udall Center for Studies in Public Policy, prepared a study on the preliminary impact of LAWA on immigration trends and businesses in Arizona. She found that not a single superior court enforcement action was filed during the first year of LAWA’s existence. The number of complaints filed with each county attorney during that period was one or none in nine out of Arizona’s 15 counties. The Pima County attorney reported only five complaints, four of which were declined because they involved individuals hired before 2008. The Maricopa County attorney’s office stated that it does not keep track of the number of reported complaints, and those that are filed reportedly are turned over to the county sheriff for investigation. Notwithstanding a number of high profile “raids” conducted by Maricopa County Sheriff Joe Arpaio in 2008, as reported in the local media at the time, no complaints have resulted in a LAWA enforcement action to date.
Finally, LAWA’s potentially adverse impact on Arizona’s economy has been negligible, or is simply undetectable. According to Gans’ study, the current recession has had a disproportionately adverse impact on business sectors that rely heavily on immigrant labor, such as construction. Therefore, because employment of all workers in those sectors, including immigrant labor, has been hard hit as a result of the current economic meltdown, any “LAWA-effect” has been masked.