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Employer sanctions coming up short

Two years ago, a bitter debate raged between supporters and opponents of the state’s new employer sanctions law. The first of its kind in the country, the law gave the state the ability to revoke the business licenses of companies that knew their workers were illegal immigrants.

The law has been in effect for 21 months, yet no businesses have been shut down over hiring practices. In fact, there hasn’t yet been a single business forced to defend itself in court.

Investigations have been mounted, but charges have failed to materialize.

“It’s ironic that what was billed as the toughest immigration law in the country, in a state with a reported 500,000 undocumented workers, hasn’t had any prosecutions. Something’s not right there,” said attorney David Selden.

When first put into place, business groups declared the law an unnecessary burden on businesses that would cripple Arizona’s economy and punish companies far too severely for failing to take precautions when hiring new employees.

Those business interests were joined by Hispanic advocates, who said the law was destined to breach the constitutional rights of minorities, especially those from Mexico and other Latin American countries, while discouraging employers from hiring Hispanic workers, for fear the company could run afoul of the new law and be shut down.

But supporters at the Capitol and across the state touted the law for its ability to do what no other immigration-related policy enacted this decade has: reduce the number of illegal immigrants living in Arizona.
It would do that, they said, by removing the enticement – jobs – that drew foreigners to enter this country illegally. And, once the jobs dried up, illegal immigrants already living here would self-deport.

Sen. Russell Pearce, a Mesa Republican who spearheaded the sanctions effort, said it has dramatically changed the way businesses in the state operate and has sent the message that Arizona does not want illegal-immigrant residents. He said he also believes the law has led to an exodus of illegal immigrants.

“The message is clear: We’re not going to put up with it anymore.” said Pearce, who is working on new legislation that would make it easier for law enforcement agencies to pursue cases against businesses that break the law.

But Jason LeVecke said the unintended consequences of the law have been far too great. He points to Texas, which will increase employment this year and hasn’t had major budget problems. The major difference between Arizona and Texas, he said, is the employer sanctions law.

Levecke owns dozens of Carl’s Jr. and Pizza Patrón restaurants and is the chairman of Arizona Employers for Immigration Reform.

“I think you can lay most of our economic woes on its doorstep,” he said. “My problem with the law always was that it burns the village to save the people. We’re doing that by driving out a lot of people who are legal, too.”

Rep. John Kavanagh, who supported the sanctions measure as it moved through the Legislature, said critics have been “crying wolf” about the effects. However, he did acknowledge the law has some deficiencies. “It is a strong deterrent,” he said. “As an actual weapon, it falls short.”

Those tasked with enforcing the law agree that the law falls short from a strictly legal standpoint. County attorneys in each of Arizona’s 15 counties said it’s difficult to prosecute businesses.

“Every time you try to take a step forward, you’ve got a hundred other things in your way, some of them blocking you,” said Jack Fields, a deputy county attorney in Yavapai County and supervisor of that office’s civil division.

His office has conducted investigations of 23 businesses since the sanctions law went into effect in January 2008, but has closed 20 of the probes without seeking civil enforcement action. The three other investigations are still open.

“It was basically determined that we did not have enough evidence to substantiate our case,” he said. “It’s just a very difficult law to enforce.”

Other counties have had similar experiences. Investigations in Maricopa, Pima and Pinal counties have all ended the same way, with businesses escaping prosecution.

Barnett Lotstein, a spokesman for the Maricopa County Attorney’s Office, said investigators are unable to gather the business records needed to prove an employer knowingly hired an illegal immigrant.
Officials from several other counties also told Arizona Capitol Times that was the biggest impediment to enforcing the law.

While prosecutors can gather business records after obtaining a warrant, the existing law does not allow them to issue subpoenas to obtain records.

“We are somewhat stymied there,” Lotstein said.

The Maricopa County Sheriff’s Office has raided 22 Phoenix-area businesses suspected of hiring illegal immigrants since 2008. The most high-profile raid, conducted on a pair of water parks in June 2008, followed a four-month investigation of the parks’ hiring practices.

Three months later, an East-Valley candle company was raided.

Although 310 employees have been arrested for identity theft and fake identifications, none of those businesses faced punishment under the state law.

Maricopa is one of several counties pushing for civil subpoena power to enforce the employer sanctions law. The county attorneys say it is impossible to prove what the employer knew, or should have known, about the employee’s immigration status without being able to examine personnel records.

“It would give us the ability to gather records and make determinations that people have used E-Verify or done their I-9s properly. Right now, we can’t do that,” Fields of Yavapai County said.

Lotstein called it “unusual” that county attorneys weren’t given subpoena power when the law was created.
“Every other administrative body that enforces civil administrative statutes has subpoena power. The Liquor Department has it and other departments have it, but in this case, we don’t,” he said.

Without that power, county attorneys are left to rely on the voluntary disclosure of personnel records by the businesses under investigation.

Alternatively, said Pima County Deputy Attorney Dan Jurkowitz, the person filing a complaint against his or her employer may bring in the necessary documents.

“If someone brings us smoking guns, we could bring enforcement,” he said.

Pearce said he will draft legislation next year to give county attorneys subpoena power in sanctions cases.
But that doesn’t sit well with everyone. Selden, who is part of the lawsuit challenging the constitutionality of the sanctions law, said the subpoena power isn’t about granting access to records – it’s about avoiding the scrutiny of the judicial system.

In each of the raids conducted by the Maricopa County Sheriff’s Office, investigators were first able to procure a search warrant, which allowed them to seize business records. Det. Aaron Douglas, an MCSO spokesman, said the warrants were possible because there was probable cause that crimes – in most cases, identity theft was cited – were being committed at the businesses.

If investigators were given civil subpoena power to enforce the employer sanctions law, they could issue the subpoenas directly to businesses they suspect are violating the law. Search warrants require approval from a judge.

“They don’t want to have the courts looking over their shoulder,” Selden said.

But Lotstein defended the need for civil subpoenas. He said search warrants were only granted because crimes were being committed. Absent the criminal acts, a search warrant wouldn’t be possible to enforce employer sanctions, which is a civil matter.

“In those incidents where there isn’t any other criminal conduct…then they couldn’t get a search warrant,” he said. “In order to gather records relating to (employer sanctions), they’d need a subpoena.”

Pinal County Attorney Jim Walsh said giving county attorneys civil subpoena power could lead to abuse. Investigators would be able to conduct “fishing expeditions” on businesses, he said.

“You don’t have to go to court and prove that you have any probable cause to go look at this guy’s records. You just say, ‘I’m going to issue a subpoena.’ Then the burden’s all on the business owner to defend (himself). That doesn’t seem to me like the American-fairness way,” he said. “I wonder about giving that kind of power to people who might not always use it as the Legislature intended.”

Lotstein said it is “conjecture” that Maricopa or any other county would use the subpoenas frivolously. And he also challenged the contention that it makes things easier for investigators at the expense of the business owner.

“Subpoenas can be challenged. If the other side feels it is a ‘fishing expedition’ or it isn’t warranted, they can challenge the subpoena,” Lotstein said.

Pearce said he intends to do everything in his power to give county attorneys the ability to issue subpoenas. He said the Maricopa County Attorney’s Office has been particularly vocal on the issue.

“This is an additional tool they’re telling me they need, and I’m going to give it to them,” he said. “They’re asking for it. They told me it would greatly help.”

Constitutional questions about the law remain unanswered. It was upheld in 2008 by the 9th Circuit Court of Appeals, but it has been submitted to the U.S. Supreme Court for consideration. The high court hasn’t indicated whether it will accept the case.

Click to read “Pearce sets out to eliminate sanctuary policies, create news fines for businesses”


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