Whether or not your business employs foreign-born workers, the new immigration law affects you. Under the law, all employers must verify the identify and legal status of new hires by means of passports, certificates of citizenship, Social Security cards, or other documents. Employers will have to certify to such verification on a government form and keep all forms for up to three years. The employer penalties, which go into effect in the spring of 1988: up to $10,000 per offense or as long as six months in jail for habitual offenders.

But the law will do more than increase paperwork. If it is effective in stemming the flow of illegal aliens, the unskilled-labor pool could shrink dramatically. Labor-intensive companies should plan new recruitment strategies now. "Look at alternative sources of labor, such as training and linking up with high schools," says Robert Juceam, a lawyer at Fried, Frank, Harris, Shriver & Jacobson, in New York City. You should also examine your pricing policies and operating expenses for ways to respond to a possible rise in labor costs.