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IMMIGRATION AND NATIONALITY LAW
		June 2008 Amendments Clarify “Legal Arizona Workers Act” Changes enacted in May 2008 make compliance a little easier for many employers Joanne Trifilo Stark

The Legal Arizona Workers Act requires employers to use the federal E-verify program to confirm work eligibility of employees hired on or after January 1, 2008. Employers found to have knowingly or intentionally hired unauthorized workers face suspension and revocation of their Arizona business licenses. The employer’s defenses include good faith compliance with Form I-9 requirements and confirmation of worker eligibility using E-verify. Despite legal challenges, including a pending appeal to the U.S. Ninth Circuit, the Act remains in effect.

Amendments. On May 1, 2008, important amendments to the Legal Arizona Workers Act were signed into law by Governor Napolitano. The amendments clarify a number of issues, including those described below.

• The Act does not apply to pre-2008 hires. Employers will not face suspension or revocation of their business licenses for non-compliant hirings that occurred in 2007 or before.

• Arizona employers are not required to E-verify out-of-state employees.

• The Act does not apply to independent contractors. However, employers may not avoid their statutory obligations by knowingly or intentionally retaining an undocumented contractor or a contractor that hires or contracts with unauthorized workers.

• An individual who wishes to file a complaint should use a form created for that purpose by the Attorney General. Complaints filed on this form must be investigated by the County Attorney. Complaints filed via another type of form or filed anonymously may be investigated at the County Attorney’s discretion.

• The only business license subject to suspension or revocation is the one covering the location of the business where the undocumented workers are employed. However, if the employer does not hold a license at that location, all licenses held by the employer are subject to revocation.

• If the employer makes a good faith attempt to comply with I-9 requirements but makes “isolated, sporadic or accidental” errors, the employer still has the good faith I-9 defenses.

• Any employer receiving state, county or city grants or loans must register and use E-verify.

Additional Protection. Employers seeking more protection from violations of the Legal Arizona Workers Act may now enroll in the “Voluntary Employer Enhanced Compliance Program.” While participants in the program bear a higher burden of compliance, they will not be liable under Arizona law for “knowingly or intentionally” employing illegals.

The voluntary program requires participating employers to swear that, in addition to using E-verify for every new hire, the employer will, within 30 days of enrollment, use the Social Security Number Verification Service to verify all employees not otherwise confirmed using E-verify. In addition, once a failed verification result is received from the Social Security Administration, the employee will coordinate with the employee to resolve within 90 days any failed verification result. The employer and employee may take additional time, as long as they document ongoing efforts to resolve the failed verification result and submit documentation to the Attorney General. (The amendment does not state whether the employer should terminate the employment if the verification is not resolved.) The employer, if asked, must also give the Attorney General or County Attorney documentation showing that the employer confirmed a particular employee’s work eligibility using E-verify, or the Social Security number for wage reporting purposes, using the Social Security Number Verification Service.

State Contracts. On or after September 30, 2008, state government agencies are prohibited from awarding contracts to contractors or subcontractors not in compliance with the E-verify requirement. The contractor must also warrant compliance with federal immigration law. The contract must contain a provision that the state agency may inspect all “papers” of employees of contractors working on the project to confirm compliance with the warranty.

False IDs. The new law amends Arizona’s criminal laws to prohibit knowing acceptance of false personal identifying information and using the information to complete Form I-9 for the employee. A violation is a Class 4 felony punishable by up to 30 months in prison.

Cash. Employers that have two or more employees and pay in cash must now comply with state income tax withholding, Department of Economic Security reporting, state unemployment and worker’s compensation requirements. An employer failing to comply with these requirements faces (a) triple the amount of all withholdings payments and premiums owed or (b) $5,000 per employee, whichever is greater.

These materials are designed to provide general information prepared by professionals in regard to the subject matter covered. It is provided with the understanding that the author is not engaged in rendering legal, accounting, or other professional service. Although prepared by professionals, these materials should not be utilized as a substitute for professional service in specific situations. If legal advice or other expert assistance is required, the service of a professional should be sought.