Chamber of Commerce of United States of America v. Whiting

Background

A business group (the Chamber of Commerce) sued Arizona officials to stop enforcement of the Legal Arizona Workers Act. The Arizona law allows state courts to suspend or revoke business licenses when an employer knowingly or intentionally hires unauthorized workers, and it requires employers to use the federal E‑Verify electronic verification system. The federal immigration statute IRCA contains a preemption rule that forbids most state civil or criminal sanctions for hiring unauthorized workers but excepts “licensing and similar laws.”

Reasoning

The Court considered whether the Arizona licensing and E‑Verify provisions were preempted by federal law. It held that Arizona’s licensing penalties fall within IRCA’s saving clause for “licensing and similar laws,” noting Arizona adopts federal definitions, relies on federal determinations about an employee’s status, and preserves federal defenses like good‑faith I‑9 compliance. The Court also found that Arizona’s mandatory E‑Verify requirement does not conflict with federal law because the federal statute limits only what the Secretary of Homeland Security may require, and Arizona’s use of E‑Verify does not prevent the federal program from operating.

Real world impact

The decision allows Arizona and similarly situated States to pursue license‑based sanctions against employers who knowingly or intentionally hire unauthorized workers, and to mandate E‑Verify for new hires. The ruling affirms that States may tailor licensing penalties while relying on federal definitions and federal determinations of immigration status. The Court noted the State’s procedures are tied to federal findings rather than independent state immigration adjudication.

Dissents or concurrances

Justices Breyer and Sotomayor dissented, warning the law could encourage discrimination, risk erroneous enforcement due to E‑Verify errors, and that E‑Verify was meant to be voluntary under federal policy.