Last week the Second Circuit held, in Palma v. NLRB, that undocumented aliens were not entitled to back pay following a determination that their employer engaged in unlawful employment practices in violation of the National Labor Relations Act (NLRA).
The court based its decision on the Supreme Court’s ruling in Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2002), which held that an award of backpay to an undocumented alien who was never legally authorized to work in the U.S. is “foreclosed by federal immigration policy, as expressed by Congress in the Immigration Reform and Control Act of 1986 (IRCA).”
Specifically, Hoffman held:
allowing the [NLRB] to award backpay to illegal aliens would unduly trench upon explicit statutory prohibitions critical to federal immigration policy, as expressed in IRCA. It would encourage the successful evasion of apprehension by immigration authorities, condone prior violations of the immigration laws, and encourage future violations. However broad the Board’s discretion to fashion remedies when dealing only with the NLRA, it is not so unbounded as to authorize this sort of an award.
The Palma court extended this rationale to the instant case:
These same concerns exist here in light of the General Counsel’s concession for purposes of this case that petitioners are undocumented. Given petitioners’ presence in the United States without documentation, their seeking damages stemming from an unlawful employment relationship, and—assuming there has been no change in their undocumented status—their obtaining new unlawful employment following their terminations by Mezonos, awards of backpay would have the same ill-advised propensity discussed in Hoffman Plastic for condoning prior violations of the immigration laws and encouraging future violations.
The fact that Congress chose in IRCA not to impose criminal sanctions on undocumented aliens simply for working without authorization does not in any way suggest that Congress meant to allow the Board to encourage undocumented aliens to work by awarding them backpay; and this Court has previously interpreted Hoffman Plastic as foreclosing such awards. … We are not persuaded to reach the opposite conclusion by cases … which ruled that IRCA did not preempt awards to undocumented aliens as compensation for personal injuries caused by an employer’s negligence or misconduct. IRCA’s focus is on violations of the immigration laws, not on workplace safety.
The court disagreed with the workers’ argument that “awards of backpay are needed in order to discourage employers from hiring undocumented workers”. It quoted the Supreme Court’s words from the Hoffman case:
Lack of authority to award backpay does not mean that the employer gets off scot-free. The Board here has already imposed other significant sanctions against Hoffman…. These include orders that Hoffman cease and desist its violations of the NLRA, and that it conspicuously post a notice to employees setting forth their rights under the NLRA and detailing its prior unfair practices…. Hoffman will be subject to contempt proceedings should it fail to comply with these orders. … We have deemed such “traditional remedies” sufficient to effectuate national labor policy regardless of whether the “spur and catalyst” of backpay accompanies them.
The court therefore concluded that the NLRB did not err by interpreting Hoffman to require the denial of backpay.
The court, however, remanded the matter to the NLRB for consideration of issues relating to the workers’ request for conditional reinstatement – i.e., reinstatement conditioned on IRCA-compliant documentation to show that they are lawfully present in, and authorized to work in, the U.S.