Supreme Court Upholds Arizona Illegal-Hiring Law

The U.S. Supreme Court, rejecting business arguments, upheld an Arizona law that threatens companies with the revocation of their corporate charters if they hire illegal immigrants.

In a 5-3 ruling, the justices said a federal law governing immigrant hiring leaves room for states to impose their own penalties for non-compliance, even by stripping away a company’s license to do business.

The breakdown may hint at the outcome should the high court consider a separate Arizona law giving local police a greater role in arresting illegal immigrants. The court’s five Republican appointees formed the majority today, buttressing state power and rejecting the type of business concerns they often support in other contexts.

“License suspension and revocation are significant sanctions,” Chief Justice John Roberts wrote in the court’s lead opinion. “But they are typical attributes of a licensing regime” imposed by states.

Roberts said the Arizona law allows the so-called business death penalty only for the most egregious cases, involving at least two intentional violations. “An employer acting in good faith need have no fear of the sanctions,” he wrote.

So far, Arizona officials have filed only a handful of enforcement actions against employers.

Similar Laws

The ruling might spur enactment of similar laws elsewhere. In challenging the measure, the U.S. Chamber of Commerce said dozens of states have recently enacted laws regulating employment of illegal immigrants. In the first quarter of this year, state lawmakers introduced 279 employment-related immigration bills, according to a report by the National Conference of State Legislatures.

The justices also upheld Arizona’s requirement that employers participate in E-Verify, a system designed to allow confirmation of worker eligibility for employment through federal databases. The system is voluntary under U.S. law.

Justices Antonin Scalia, Clarence Thomas, Anthony Kennedy and Samuel Alito formed the majority with Roberts. Thomas joined only some of the chief justice’s reasoning.

Roberts’s opinion itself may provide limited guidance for other immigration cases. He focused on a 1986 federal statute that bars states and cities from penalizing employers for hiring illegal aliens except through “licensing and similar laws.”

Congressional Authority

Arizona’s law “falls well within the confines of the authority Congress chose to leave to the states,” Roberts wrote.

Justices Stephen Breyer, Ruth Bader Ginsburg and Sonia Sotomayor -- all Democratic appointees -- dissented, saying the federal law pre-empts the state statute.

The Arizona law “strays beyond the bounds of the federal licensing exception,” Breyer wrote for himself and Ginsburg. Justice Elena Kagan didn’t take part because she played a role in the litigation as a lawyer in President Barack Obama’s administration.

The Chamber of Commerce joined with civil rights groups and a labor union in challenging the Arizona law. The Obama administration also said the law should be struck down.

The other Arizona law is on hold after a federal appeals court said the state was interfering with the federal government’s authority over immigration policy.

That measure requires local police officers to check immigration status when they arrest or stop someone and have “reasonable suspicion” that the person is in the country illegally. The law also requires registered aliens to carry documentation with them at all times.

Arizona Governor Jan Brewer, a Republican, said earlier this month that she will appeal to the Supreme Court.

The Arizona police law was the first of its kind. Almost two dozen states have considered similar measures, drawing lawsuits and opposition from business groups.

The case is Chamber of Commerce v. Whiting, 09-115.

To contact the reporter on this story: Greg Stohr in Washington at gstohr@bloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net.

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