The Legal Arizona Workers Act (LAWA) requires the Attorney General or County Attorney to investigate all complaints made by anyone against an employer relating to the employment of unauthorized aliens. The U.S. Immigration and Customs Enforcement (ICE) agency and local enforcement will be informed of valid complaints, and the County Attorneys may file charges against the employer. The Act also provides for a progressive penalty system that depends on whether the violating employer "knowingly" or "intentionally" employed the unauthorized alien. The Act applies to Arizona employers of all sizes. The other major provision of the Act requires all employers use the federal E-Verify system to verify the employment eligibility of all new hires beginning January 1, 2008. LAWA was challenged by business and civil rights groups alleging that the Act was preempted by federal law and would lead to discrimination by employers.

Lower courts found that LAWA was not preempted by the Immigration Reform and Control Act of 1986 (IRCA) and that, specifically, the statute was a "licensing" statute that is expressly permitted by that law. On May 26, 2011, The United States Supreme Court affirmed the decisions of the lower courts noting that "Arizona has taken the route least likely to cause tension with federal law."

This ruling will have an impact beyond the borders of Arizona. Many states struggling with illegal immigrant issues have been awaiting this ruling in order to determine whether they should implement their own laws to help curb the hiring of unauthorized workers. However, it should be noted that this ruling does not address Arizona's other controversial immigration statute, S.B. 1070, which requires law enforcement officials to attempt to determine the immigration status of any person that they believe to be an alien unlawfully present in the United States. Stay tuned for updates on that incendiary topic.