Arizona's employer-sanctions law was among the first in the nation to go on the books, sending the state into a new world of employee screening, absent workers and anxious waiting for prosecutions.

Now, a year after it was signed into law, the measure has survived a challenge in federal court and is the first in the nation to get an airing before a federal appeals court.

On Thursday, the 9th U.S. Circuit Court of Appeals hears the case, which is being pressed by business groups, civil-rights groups and Latino organizations.

The law allows the state to suspend or revoke the business license of employers found to have knowingly hired illegal workers. The case is being closely watched by lawmakers, attorneys, employers and immigration activists of all stripes. And not just in Arizona.

The Legal Arizona Workers Act, in effect since January, has spawned a number of similar acts in states from Mississippi to Indiana, New Jersey to Colorado.

Two other sanctions-related cases will follow the Arizona case to appeals courts, likely later this summer. The resulting opinions will shape a landscape that could guide sanctions laws nationwide, as well as increase pressure on Congress to do something about illegal immigration.

"It's hard to underestimate the impact Arizona has had with its employer-sanctions law," said Kris Kobach, a law professor at the University of Missouri-Kansas City who has been helping the state of Arizona with its defense of the law.

Arizona, Kobach said, has done two things: It won the first legal challenge against its sanctions law, which emboldened other states to follow suit.

And anecdotal evidence suggests the mere existence of the law has prompted illegal workers to deport themselves, lessening their strain on the state, Kobach said.

Critics of the Arizona law also have the case on their must-watch list.

"I think Arizona is on the cutting edge of some of these issues," said Kevin Johnson, a professor of law and "chicana/o" studies at the University of California-Davis who advocates open borders.

He said the Arizona Legislature has taken "a very aggressive stance" on immigration reform.

At the heart of the three appeals cases is a core constitutional question: Do state and local governments have the authority to set immigration policy?

Yes, attorneys for Arizona say. The role is limited, but they argue that Arizona's policies fit within the narrow window.

Lawyers representing the city councils in Hazleton, Pa., and Valley Park, Mo., are pursuing similar arguments.

In the case of Valley Park and Arizona, federal judges agreed with the government positions. In Pennsylvania, a federal judge said the city overstepped its bounds in requiring every employer seeking a city business permit to file an affidavit affirming that the company does not knowingly hire or employ any illegal workers.

The three cases have set the stage for a dramatic and possibly contradictory round of appeals-court decisions that are expected to be announced this summer or fall, Kobach and Johnson said.

Johnson says the 9th Circuit decision could be the most influential on future legal rulings, especially since the court deals with more immigration cases than any other appeals court. In any event, most observers expect that one or more of the sanctions laws will ultimately be appealed to the U.S. Supreme Court, given the economic and legal ramifications of the measures.

Arizona's law, like the others, relies on an exemption in the 1986{check} federal Immigration Reform and Control Act for local and state governments to take action when it comes to "licensing and similar laws."

The Legal Arizona Workers Act, state attorneys argue, uses that exemption to justify its sanctions for illegal hires: Suspension of a state-issued business license if an employer is found to have knowingly hired an illegal worker. A second offense would result in loss of that license.

But attorneys arguing against the state law say the Arizona Legislature reached too broadly. A license intended to spell out the requirements for being a hairdresser, for example, should not be used as a way to penalize a business.

The exemption, attorneys for the business and Latino groups say in a court filing, does not give Arizona or any other state the right to enact "their own broad employer-sanctions schemes."

To date, there have been no prosecutions of the law, though The Republic reported in March that Maricopa County had started five formal investigations.

The lack of prosecutions, Kobach says, raises the hurdle for the complaining parties.

"They've made their threshold argument much harder," Kobach said, because the plaintiffs have to make a theoretical case, rather than pointing to a business that can show damage from having business licenses suspended or revoked.

In fact, none of the laws at the center of the three cases going before appeals courts has produced any prosecutions.

While the legal battles are being waged, local and state lawmakers are refusing to sit on the sidelines.

The Missouri General Assembly last month approved an employer-sanctions law that mirrors the Valley Park ordinance. The bill is awaiting action by Gov. Matt Blunt, a Republican, who has strongly signaled that he will sign it.



Kobach and Johnson say the state and local action is a reaction to Congress' inability to pass immigration reform.

"Part of it has to do with frustration," Johnson said. "I think there's clear evidence the feds are listening."

He pointed to a high-profile raid of an Iowa slaughterhouse last month that resulted in the arrest of 389 immigrants.

And in late May, President Bush announced efforts to streamline the process for applying for H2B visas for seasonal labor, as well as a plan to expand the definition of "temporary" for seasonal laborers from 10 months to three years.

Kobach said look for the decisions in the sanctions cases - whichever way they might go - to be heard on Capitol Hill.

"I think it's almost certain we'll see another immigration fight in Congress in 2009," he said.