Labor Law - Undocumented Immigrants - Second Circuit Holds Undocumented Workers Are Categorically Barred from Backpay under the National Labor Relations Act

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LABOR LAW--UNDOCUMENTED IMMIGRANTS--SECOND CIRCUIT HOLDS UNDOCUMENTED WORKERS ARE CATEGORICALLY BARRED FROM BACK PAY UNDER THE NATIONAL LABOR RELATIONS ACT.--Palma v. NLRB, 723 F.3d 176 (2d Cir. 2013).

Undocumented immigrants are "employees" within the definition of the National Labor Relations Act (1) (NLRA). (2) In Hoffman Plastic Compounds, Inc. v. NLRB, (3) the Supreme Court limited the ability of the National Labor Relations Board (NLRB or Board) to order backpay for an undocumented immigrant who was unlawfully fired and who used false documents when hired, holding that such a remedy would conflict with the Immigration Reform and Control Act of 1986 (4) (IRCA). over the past eleven years, state courts and lower federal courts have grappled with the limits of Hoffman. (5) Recently, in Palma v. NLRB, (6) the Second Circuit held that Hoffman categorically bars the NLRB from awarding backpay to undocumented immigrants who have been unlawfully fired, even if they did not use fraudulent documents when initially hired. (7) this broad reading of Hoffman was not necessary and brings Palma into tension with the Second Circuit's reasoning in Madeira v. Affordable Housing Foundation, Inc., (8) which embraced a distinction based on whether the employer or the employee violated IRCA. (9)

IRCA made it unlawful for an employer to hire an unauthorized (10) worker. (11) The Immigration Act of 1990 (12) added a prohibition against unauthorized workers using false documents to gain employment. (13) Notably, it is not unlawful for undocumented immigrants to seek work, only to present fraudulent documents. (14) Employers must verify an employee's work authorization by reviewing specified documents (for example, a social security card). (15)

Christian Palma and six others were employed by Mezonos Maven Bakery (Mezonos) in Brooklyn, New York. (16) In 2003, they brought a complaint to a manager about another supervisor. (17) In retaliation, Mezonos fired all seven, in violation of the NLRA. (18) The seven coworkers filed a claim with the NLRB. (19) In 2005, the parties agreed to a settlement stipulation overseen by the Board. (20) In compliance proceedings, Palma and his coclaimaints stipulated for the purposes of the NLRB proceedings that they were undocumented immigrants and not authorized to work in the United States. (21) Although the parties contested whether Mezonos had initially requested work authorization documents (as required by IRCA), they agreed that the seven claimants never presented any fraudulent documents to their employer. (22) However, Mezonos alleged that the workers, as undocumented immigrants, were prohibited from receiving backpay or being reinstated under Hoffman. (23)

Judge Davis, an Administrative Law Judge in the NLRB Division of Judges, held the original NLRB order to be valid, deciding that Mezonos had not yet offered reinstatement to the workers, and that Mezonos owed them full backpay. (24) Judge Davis first affirmed that the NLRA applies to undocumented immigrants. (25) He then found that Mezonos hired the seven workers knowing their undocumented status, in violation of IRCA. (26) Judge Davis then distinguished this case from Hoffman based on the employees' conduct: the employee in Hoffman presented fraudulent documents to an unknowing employer, whereas Palma and his coclaimants did not, and Mezonos knew they were unauthorized to work. (27) Judge Davis explained, "employers have a perverse incentive to ignore immigration laws at the time of hiring but insist upon their enforcement when their employees complain." (28) He concluded, "[Mezonos] should not be rewarded for knowingly and intentionally violating IRCA and the [NLRA]." (29)

The NLRB reversed Judge Davis's award of backpay and did not comment on the reinstatement order. (30) The Board held that Hoffman categorically bars the NLRB from awarding backpay to undocumented immigrants, (31) rejecting Judge Davis's distinction between this case and Hoffman. …