NLRB Did Not Err in Categorically Barring NLRA Back Pay for Undocumented Workers, Second Circuit Holds

Palma v. NLRB, No. 12-1199 (2d Cir. July 10, 2013): Petitioners are undocumented aliens who were unlawfully discharged for engaging in protected activities under the National Labor Relations Act (NLRA). At a compliance proceeding, the administrative law judge (ALJ) recommended that the petitioners receive back pay and unconditional offers of reinstatement. However, the National Labor Relations Board (NLRB) rejected the ALJ’s recommendation and found that the U.S. Supreme Court’s decision in Hoffman Plastic Compounds, Inc. v. NLRB precludes back pay to undocumented aliens.

On appeal to the Second Circuit Court of Appeals, the court held that the NLRB did not err in interpreting Hoffman Plastic to categorically preclude payment of back pay to undocumented aliens. In reaching this decision, the court noted that Hoffman Plastic holds that it would be inconsistent to allow payments of back pay under the NLRB because the Immigration Reform and Control Act of 1986 (IRCA) expressly made it criminally punishable for an alien to obtain employment with false documents. The court further rejected the petitioners’ argument that, unlike the plaintiffs in Hoffman Plastic, there was no evidence that the petitioners gained their jobs through fraud, because the IRCA’s prohibitions simply apply to workers unlawfully present in the United States. However, the court remanded for the NLRB to consider whether the petitioners are entitled to offers of reinstatement conditioned upon presenting proper documentation. In sum, the decision reinforces the categorical rule that undocumented aliens cannot recover back pay for violations of the NLRA.