。
Does she work in this town?
Literal
She [topic-は] this town [in-で] is-working [question-か].
A clean polite question. で marks the location of activity ('in this town'), distinct from に which marks a static location. 働いていますか combines 働く ('to work') with the resultant-state ~ている and the polite ます — the whole phrase describes her ongoing employment status, not a single act of working. The question particle か is the standard polite question tag. A simple but textbook example for learners drilling location particles and continuous-state forms.