Supreme Court Denies Illegal Aliens Backpay Under the NLRA
 
June 26, 2002
 

On March 27, 2002, the United States Supreme Court held that the National Labor Relations Board (the Board) may not award back pay to workers who were not legally authorized to work in the United States. Hoffman Plastics Compounds, Inc. v. NLRB, 122 S. Ct. 1275 (2002). Regardless of whether an illegal alien’s firing constituted an unfair labor practice under the National Labor Relations Act (NLRA), the Court concluded that the remedy of back pay was specifically prohibited by the federal immigration policy expressed by Congress in the Immigration Reform and Control Act of 1986 (IRCA).

The plaintiff, Jose Castro, was hired by Hoffman Plastics Compounds, Inc., as a machine operator. Castro presented documents showing that he was lawfully entitled to work in the United States. Approximately eight months later, he was laid off after actively supporting a union in an organizing drive at the Hoffman Plastics plant. After unfair labor practice charges were filed with the National Labor Relations Board, an Administrative Law Judge (ALJ) found that Hoffman Plastics violated Sections 8(a)(1) and 8(a)(3) of the NLRA by discriminatorily selecting union supporters for layoff. The Board subsequently adopted the ALJ’s findings and ordered reinstatement and back pay for the laid off employees.

A dispute arose as to the proper computation of back pay, resulting in a compliance hearing before another ALJ. While testifying at this hearing, Castro, for the first time, admitted that he was a Mexican national, that he fraudulently obtained documents to gain employment at Hoffman Plastics, and that he never had been legally admitted to, or authorized to work in, the United States. Based on these admissions, the ALJ reasoned that IRCA prohibited such conduct and recommended that Castro not be reinstated or awarded back pay. The Board reversed the ALJ’s decision and ordered that Castro was entitled to back pay. Hoffman Plastics petitioned the Court of Appeals for review of the Board’s back pay order. The Court of Appeals affirmed the Board’s decision relying upon a prior Supreme Court case, Sure-Tan, Inc. v. NLRB, where the Court held that illegal aliens are entitled to back pay awards as part of a remedy for an employer’s unfair labor practices unless the aliens had left the country.

The Supreme Court approached the issues in this case from a much broader perspective than the Court of Appeals, which primarily focused on dissecting the Court’s prior Sure-Tan decision. Instead, the Court focused through a wider lens on cases in which the Court had refused to defer to the Board when its remedial awards “potentially trench upon federal statutes and policies unrelated to the NLRA.” In that regard, the Court observed that two years after Sure-Tan, Congress passed IRCA, which established the country’s immigration policy of prohibiting and combating the employment of illegal aliens in the United States. Accordingly, the Court found that awarding back pay to illegal aliens runs counter to the policies underlying IRCA, policies that the Board has no authority to enforce or administer. Because IRCA made providing false documents to an employer a criminal offense, the Court had no reason to think that Congress intended to award back pay to an illegal alien who experienced an unfair labor practice at a job to which he was never legally entitled.

However, the Court did point out that the Board’s inability to award back pay to illegal aliens does not mean that an employer is free from any sanction. To the contrary, the Court noted that an employer could still be subject to traditional Board remedies, such as a cease and desist order or an order to post a notice detailing its unfair labor practices, and the employer’s failure to comply with such orders will subject it to contempt proceedings. While the Court’s holding specifically limits the scope of relief available to illegal aliens under the NLRA, it also may significantly limit the ability of other government agencies, including the Equal Employment Opportunity Commission, to fashion backpay remedies for illegal aliens under employment discrimination statutes.

For more information, e-mail Mark A. Spognardi at mark.spognardi@hklaw.com, or call toll free, 1-888-688-8500.

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