Anyone could file a complaint with the Iowa attorney general's office alleging a business is employing an illegal immigrant under a measure being discussed in the House.
Members of a subcommittee Monday will discuss the bill, which requires the attorney general, county attorneys and local police to investigate complaints.
Verified complaints would be reported to federal immigration officials, and employers could lose their business licenses.
The bill also requires employers to use a federal electronic worker verification system.
Supporters of the measure say it would level the playing field for businesses by rooting out illegal workers. Opponents say it amounts to racial profiling, could hurt businesses and would be a drain on law enforcement's time.
A total of 38 Republicans and three Democrats in the House are co-sponsoring the bill.