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PHOENIX — State lawmakers gave final approval Monday to changes in the state's 4-month-old employer sanctions law.

The major alteration in the measure, which cleared the Senate on a 22-4 vote, says the law is not retroactive. Companies would not face state penalties if an investigation found an undocumented worker on the payroll who was employed there when the law took effect Jan. 1.

HB 2745, which already has House approval, also provides additional legal protections from prosecution for companies that follow certain procedures.

It also sets up a procedure for what has to be included in written complaints alleging that a company has illegal immigrants on its payroll. But it preserves the right of prosecutors to investigate anonymous complaints.

Overall, the legislation, which now goes to Gov. Janet Napolitano, preserves the essence of what lawmakers approved last year: Firms that knowingly hire undocumented workers face possible suspension of all state business licenses. And a second violation shuts them down entirely.

The law also requires companies to verify the immigration status of new employees through the federal government's E-Verify program, designed to ensure the names and Social Security numbers of new workers are valid and they are legally entitled to work in this country.

In exchange, though, employers who use that system are entitled to a "rebuttable presumption" they have not broken the law.

The problem is the federal government allows E-Verify to be used only when someone is first hired. It specifically prohibits companies from running the names of all existing workers through the system.

That led to complaints an employer could wind up in legal trouble, and potentially be shut down, because a worker who was hired before Jan. 1 remains on the payroll although their legal status could not be checked.

The new version says there is a penalty only if a company put an undocumented worker on the payroll this year.

Sen. Ron Gould, R-Lake Havasu City, complained the measure amounted to a type of immunity for companies that knowingly hired someone here illegally Jan. 1.

But companies could still get in trouble with federal immigration officials for any illegal worker on the payroll, no matter when they were hired.

HB 2745 would provide additional legal protections from state prosecution for companies that not only use the E-Verify system but a separate Social Security Number Verification Service. Employers also would be required to turn the results of those checks over to state or local prosecutors if requested.

Employers wanted to eliminate the ability to file anonymous complaints, saying it provided too much opportunity for a competitor or disgruntled worker to trigger a lengthy and expensive investigation. But Rep. Russell Pearce, R-Mesa, architect of the original law, said anonymous tips are as important to investigating employment law violations as they are in criminal cases.

Napolitano, in signing the original measure last year, said she thought at the time it needed some changes. The governor has not commented about what is in this bill.

Despite the latest action, the legality of the measure remains under challenge. Business organizations and their allies contend only the federal government can regulate immigration and punish those companies that have undocumented workers on the payroll.

Those arguments, however, were rebuffed earlier this year by U.S. District Court Judge Neil Wake. The case is now pending before the 9th U.S. Circuit Court of Appeals.