Earning a Living in Arizona’s History 

Anthony Sanders is the director of the Center for Judicial Engagement at the Institute for Justice, which represents plaintiff Greg Mills in Mills v. Arizona State Board of Technical Registration. 

History is on your side if you’re an entrepreneur faced with a nonsensical regulation. Whether that history will help you is currently before the Arizona Supreme Court in Mills v. Arizona State Board of Technical Registration. Greg Mills, an electrical engineer, is challenging the state’s demand that he obtain a license even though almost no other engineers doing the kind of work he does face such a requirement. It’s the latest example of a state court reexamining its constitution’s entrepreneurial past.

The History of Work

The right to earn a living is an age old liberty, recognized in sources as antique as Lord Coke’s The Case Against Monopolies in 1602, across antebellum opinions, and protected in all kinds of courts during the so-called “Lochner era.” Yet, readers may have learned in law school that during the New Deal the U.S. Supreme Court threw that right into history’s dustbin. 

That last bit is only partly true. The right to earn a living has lived on in the federal courts, although mostly as a technical matter. A law can still violate the right under the U.S. Constitution’s due process clauses if it fails the rational basis test announced in 1955 in Williamson v. Lee Optical. It is, however, an incredibly hard test for the government to fail. Results vary, but federal court isn’t a friendly place if you’re an entrepreneur. 

What about state courts? I’ve previously detailed how, after the New Deal, economic liberties had a better time of it in state constitutional law. This meant that entrepreneurs had a fighting chance in many states against restrictions on engaging in their trade. Although courts didn’t generally evaluate restrictions using strict scrutiny — indeed, the government usually enjoyed the benefit of the doubt — courts would take a hard look at the facts and assess whether the law was a reasonable way to promote public health, safety, and welfare. This sometimes is called the “real and substantial test.” Under the Lee Optical test, by contrast, courts can speculate about facts and make up reasons the legislature might have considered in passing the law in question. 

Over the years, however, many states eventually succumbed to that giant sucking sound so often excoriated among the pixels of State Court Report: the lockstep doctrine. Lee Optical-type reviewwas applied in more and more state constitutional cases. Not always, though. The result is that the standard in many states is a confusing muddle. Some case law says entrepreneurs have a shot at proving their claim under older standards that emphasized actual reasonableness, often the “real and substantial” test mentioned above. Indeed, some of those cases are fairly recent and entrepreneurs often win in them. But there’s much else that embraces the Lee Optical test. That being said, a few states — including Georgia, North Carolina, and Texas— have explicitly rejected Lee Optical in recent years when it comes to the right to earn a living.

Engineered Against the Competition

That brings us back to Greg Mills in Arizona. He has worked for decades as an engineer designing electrical circuits for manufactured products, everything from flashlights to satellites. Like most engineers in the United States, he does not have a license; an estimated 80 percent do not. 

Engineering licensing laws differ from state-to-state, but generally — including in Arizona — a license is only required for so-called professional engineers. Professional engineers work almost entirely on construction projects like roads, dams, buildings, and similar large-scale projects. (Think civil engineers and the like). Mechanical and electrical engineers who design products, like Mills, generally do not need licenses. The same is true for many other kinds of engineers, including software engineers and biochemical engineers. This is because construction plans — unlike designs for things like electrical products or software — generally require a professional engineer, or architect, or similar, to approve the plans before they can be built. 

Unfortunately, these lines sometimes get hazy and there has been, for decades, a vicious turf war over who needs a license and who even can call themselves an “engineer.” Many professional engineering boards are classic examples of regulatory capture, where administrators will admit that unlicensed non-civil engineers can do what they do as long as they don’t call it “engineering” — even though that English word accurately describes their work. Professional engineer lobbyists claim these engineers can’t call themselves “engineers” to protect the public but, in the opinion of this author and others who care about economic liberty, they are actually just protecting the money and prestige that comes with a license. Indeed, professional engineering groups have asked that all engineers be licensed for similar protectionist and anticompetitive reasons.

Mills was caught in the crossfire of this intra-engineering line drawing. According to Arizona authorities, Mills was fine engineering electrical circuits for products when he worked full time for manufacturers. But when he started his own consulting business and did the same thing for manufacturers big and small as an independent contractor, he needed to get a license. This would have required him to either shut down his business and work under a licensed professional engineer for eight years (likely for construction work irrelevant to his actual profession) or go back to working full time for a manufacturer — which, again, itself is not required to employ any licensed professional engineers. 

In 2019, Mills challenged this nonsensical scheme under the Arizona Constitution. He did not argue that the state did not have the power to license engineers; rather, he said that given who was required — and not required — to get a license, it was unconstitutional to make him get one. Among other claims, he argued that making him get a license violated his right to earn a living under the state’s due process clause. In another claim, he said that forcing him to get a license but not employees of manufacturers violated Article II, Section 13 of the Arizona Constitution, which requires equal treatment of “privileges or immunities” and has been regarded as the state’s equivalent of an equal protection clause.

After a trip to the Arizona Supreme Court on procedural issues in 2022, the trial court dismissed his complaint. It ruled, among other things, that Arizona’s protection of the right to earn a living is synonymous with the federal standard. The intermediate court of appeals affirmed. 

This past January, Mills found himself before the supreme court again, this time arguing the merits of his case, although still only at the motion to dismiss stage. The court asked the parties to address three questions: First, what is Arizona’s standard in economic liberty cases? Second, is Mills “similarly situated” to engineers working in the “manufacturing industry” full time? And third, does the restriction on Mill using the word “engineer” implicate his free speech rights? 

At oral arguments last week, the justices were most focused on the first issues. Both sides’ counsel and the justices drew attention to differences and similarities between the Lee Optical test — which the Arizona Supreme Court adopted in a 1981 case, Arizona Downs v. Arizona Horsemen’s Foundation—and the standard it applied before 1981. 

Counsel for the government argued that the two tests aren’t that different, so there would be no point going back now. From my (admittedly biased) standpoint, this is a stretch, but it comes down to the fact that words like “reasonable,” “rational,” and the like were used in economic liberty cases in all different eras. Some cases in the 1920s found laws constitutional because they were “reasonable,” and cases citing Lee Optical occasionally have done the same. In contrast to the state, Mills’s counsel, my colleague Paul Avelar, emphasized that the government lost in many pre-1981 cases, illustrating that the previous test was, in fact, more protective of economic liberties. He also said that the court’s method of carefully assessing the facts is very much not the Lee Optical rational basis test, because when taking Lee Optical seriously facts generally don’t matter. The court can make them up if they sound at all plausible.

Arizona’s constitution dates to 1912, when it joined the United States. From an originalist perspective, the standard used at that time in economic liberty claims would be a better fit than the Lee Optical test, which, of course, the U.S. Supreme Court itself didn’t use in 1912. And for those of you who don’t like originalism, the same is true from an anti-lockstep perspective; Arizona courts should not change standards just because their federal counterparts have. 

If the court rules for Mills, his case will go back to the trial court with an instruction that the court apply a more protective standard to attack the state’s haphazard licensing scheme. More importantly, a ruling will firmly place Arizona on the side of states that have more explicitly protected the right to earn a living in recent years, de-muddling their recent case law and better aligning their constitutions with all that history.