Move over television's Judge Judy. Arizona employers, including those agriculturally-based, are embroiled in a real life courtroom nail biter that could either push Arizona employers out of the state or negate or scale back the most aggressive employer sanction's law in the nation before it even takes effect.

In mid-November, U.S. District Court Judge Neil Wake was scheduled to hear oral arguments in a legal challenge to the Legal Arizona Worker Law slated to take effect in Arizona on Jan. 1, 2008. Judge Wake's decision is expected before the end of December.

The legal challenge by 12 plaintiffs includes the Arizona Farm Bureau (AZFB), the Arizona and U.S. Chambers of Commerce, Arizona Contractors Inc., Employers for Immigration Reform Inc., Arizona Hispanic Chamber of Commerce Inc., and others.

“Arizona's new employer sanctions law will result in discriminatory enforcement against employers who employ Hispanic workers,” said Kevin Rogers, AZFB president. “The new law's sole dependence on an inadequate federal verification system and its lack of constitutional due process are the reasons the Arizona Farm Bureau has joined with other business groups in a legal challenge against the new law.”

If the law stands intact, Arizona employers that “knowingly” or “intentionally” employ an unauthorized worker on or after Jan. 1, 2008 could lose their Arizona business licenses, i.e. articles of incorporation, pesticide applicator license, driver's license, and all permits.

At stake is the absolute survival of Arizona businesses. For employers found guilty of hiring an undocumented employee once, each Arizona license the business has could be suspended for up to 10 days. If found guilty twice, all state licenses could be permanently revoked.

“License revocation is a euphemism for putting people out of business,” said Joe Sigg, government relations director with the Arizona Farm Bureau.

According to attorney David Selden, “The Legal Arizona Worker Law threatens the state's agricultural industry by depriving the industry of the workers needed to tend and harvest crops. If you can't harvest the crops, you won't get them to market.”

Selden is co-counsel to the lawsuit brought by the Phoenix-based law firm Ballard Spahr Andrews & Ingersoll, LLP.

Selden spoke to farm employers during a labor-immigration workshop in early November at the AZFB annual meeting in Carefree, Ariz. He handed out inch-thick booklets noting current federal immigration law, thorough explanations of the new state law, and examples of the myriad ways he claims the new law violates the Arizona and U.S. Constitutions.

“I am extremely confident that Judge Wake will declare the law unconstitutional,” Selden said.

The Arizona Legislature passed the employer sanctions law, House Bill 2779, in 2007 out of frustration with Congress' failed attempts to pass meaningful immigration reform. Gov. Janet Napolitano, Arizona's chief executive, sealed the deal with her signature on July 2, 2007, just days after Congress failed to adopt reform.

The federal government prohibits states from fining companies who knowingly hire illegals, so Arizona lawmakers flexed their way around the law settling on license revocation.

The end result is an Arizona law that's not ready for prime time, Selden said.

“There should have been more discussion, study, and deliberation to get it right. Instead, lawmakers passed a law that wasn't anywhere close. The law on the books is flawed,” Selden said.

The lawsuit seeks declaratory judgment proclaiming the act as unconstitutional to block enforcement of the act. If the plaintiffs prevail, Arizona could be precluded from legal enforcement.

The suit claims the law violates the Arizona and U.S. Constitutions in the following areas: U.S. Constitution — supremacy clause and pre-emption by federal immigration law, procedural due process, the commerce clause, and substantive due process guarantees, and the fourth amendment; and the Arizona Constitution — procedural due process guarantees, and separation of powers.

According to Selden, three major wrongs of the law include:

  • The law makes bad economic sense.

  • Immigration is a federal issue and it's wrong to have state and local governments enacting a patchwork of laws that have unintended consequences that burden the economy. It's basically trampling on the constitutions to jump into the immigration issue.

  • A third area is the lack of due fairness in the law's administration. To have racial profiling-based complaints and the government taking action based on that is un-American, Selden said.

News of the precedent-setting law has farm employers thinking twice about continued farming in the Grand Canyon State, Selden said. This is especially true in the Yuma County area where an estimated 20,000 employees are required daily during the winter vegetable season to tend crops. Moving production into Mexico is a current thought.

“We've heard anecdotal reports that some producers are planning not to plant or are withholding planting intentions until they learn what happens with the lawsuit and whether the law takes effect,” Selden told the farm employers. “We've also heard that some chile peppers may not be planted. This ripples throughout the entire agricultural economic sector.”

Chile peppers are grown primarily in southwestern Arizona.

The new Arizona law mandates employer use of the E-Verify program (formerly know as the Basic Pilot). That's in strong contrast to a new Illinois law that bans employer use of the program. In those states where E-Verify is utilized, employers enrolled in the program have three days after hiring to check an employee's work-authorized status.

For Arizona farmers currently not enrolled in the E-Verify program, Selden urged them to delay enrollment until late December. Once an employer enrolls, 30-day notice is required to cancel out of the program after enrollment.

“There's no reason to panic just yet. Hopefully the court will say this law cannot be implemented because it conflicts with the Constitution.” Selden is optimistic that Judge Wake will rule in favor of the plaintiffs.

E-Verify enrollment is a contract between employers and the Social Security Administration (SSA) and the Department of Homeland Security (DHS). By signing the Memorandum of Understanding, permission is granted to the SSA and DHS the right to inspect employment records with no other consent or legal action required.

About 19,000 employers nationwide are enrolled in E-Verify while about 9,000 actively utilize the program. If the law is upheld, Arizona's 150,000 employers would be required to enroll in E-Verify by Dec. 31, 2007.

Could similar legislation be in the cards for California employers? Selden thinks not since the political climate in California is more diverse because of its larger Latino voting block.

If the state law is upheld, Selden offered this employer advice:

“Make sure the I-9 employment verification forms are complete and accurate. If there are flaws, generate new I-9s. Every hired person should go through the I-9 and E-Verify processes. If an employer acquires information that a person is unauthorized, take action to no longer employ them,” Selden said.