Immigration Status Not a Bar to FLSA Back Pay Recovery

Two hurricane shutter installers will recover approximately $44,300 in unpaid overtime and liquidated damages under the Fair Labor Standards Act (FLSA), despite arguments that one worker was not authorized to work in the U.S. and neither reported their earnings to the Internal Revenue Service. Lamonica v. Safe Hurricane Shutters Inc. (11th Cir. 2013).

The employer argued that the workers should not be allowed to recover back pay under the legal doctrine of “in pari delicto” which holds that a participant in wrongdoing should not profit from that wrongdoing. The Eleventh Circuit Court of Appeals found no evidence that the workers played a role in the employer’s scheme to deprive them of overtime pay and rejected this argument.

The employer also cited the Supreme Court’s 2002 decision in Hoffman Plastic Compounds, Inc. v. NLRB in support of its argument that the workers should not recover. In Hoffman, the Supreme Court held that the National Labor Relations Board could not award back pay to undocumented workers fired for union activity in violation of the National Labor Relations Act (NLRA). The Eleventh Circuit said, however, that Hoffman only limited recovery under the NLRA, not the FLSA. The court found Hoffman to be different because it involved workers trying to recover pay for being deprived of jobs that they could not lawfully perform, whereas in this case the workers were trying to be paid for work they had already performed. 

Along with the company, the court also held two individuals who were both shareholders and directors personally liable because they exercised sufficient operational control over payroll matters. The FLSA is one of the few employment laws where personal liability can be imposed.

With the so much activity on the immigration front, this case is a reminder that most employment law protections extend to undocumented workers.