The Supreme Court today upheld the Legal Arizona Workers Act, the Arizona state law that requires employers to participate in the federal E-Verify system, and further, punishes employers that knowingly employ unauthorized aliens. Under the Arizona law, sanctions for non-compliance include the suspension and revocation of business licenses of employers. The Supreme Court, in a 5-3 decision, rejected the argument that had been advanced by employers - that federal immigration law preempts the field, barring the enforcement of state laws on the subject. Chamber of Commerce of United States v. Whiting, No. 09-115 (May 26, 2011).

Federal immigration law preempts states from imposing civil and criminal sanctions, "other than through licensing and similar laws," on those who employ unauthorized aliens. The Court in Whiting said that federal immigration law does not preempt the Arizona Act because it imposes licensing sanctions, rather than civil or criminal sanctions.

The Court also said that the Arizona law does not impose restrictions in addition to, or separate from, the restrictions of federal immigration law. For example, the Arizona Act defers to the federal government all determinations as to whether a specific person is authorized to work in the United States.

With this ruling, employers doing business in Arizona must, as before, ensure they are in compliance with the Legal Arizona Workers Act. The Whiting decision also affects employers doing business outside Arizona. Several states-including Colorado, Missouri, Pennsylvania, Tennessee, Virginia, and West Virginia-have enacted similar laws that impose licensing sanctions on those who employ unauthorized aliens.

In Colorado, state agencies or political subdivisions are prohibited from entering into contracts with entities that knowingly employ or contract with illegal aliens. Colo. Rev. Stat. § 8-17.5-102. Among other things, public contractors in Colorado must agree not to knowingly employ or contract with an illegal alien to perform work under the contract, and must agree to terminate subcontracts with those who employ illegal aliens. Whiting does not directly uphold laws such as Colorado's, but the Supreme Court decision certainly should cause employers doing business in Colorado (and in other states that have enacted similar laws) to re-double their efforts to comply with applicable state laws related to immigration. Employers should make no assumptions that state laws mandating compliance with the federal immigration laws will be overturned by the courts.