On July 10, 2013, the Second Circuit Court of Appeals held that undocumented workers are not entitled to back pay under the National Labor Relations Act (NLRA) but may be able to receive conditional reinstatement. Palma v. N.L.R.B. (2nd Cir. 2013).
In Palma, an undocumented worker and four of his undocumented co-workers complained to their employer Mezonos Maven Bakery, Inc. about poor working conditions, which entailed 65- to 75-hour six-day workweeks, no overtime, and harassment. The employer fired the undocumented workers for their complaint. The workers filed an NLRA charge arguing that the employer should not be allowed to use their lack of work authorization as a shield against back pay liability for an NLRA violation.
Finding that the employer violated the NLRA, an administrative law judge awarded the workers back pay. The judge based his finding on a previous U.S. Supreme Court decision that held that NLRA back pay is foreclosed by the Immigration and Reform Control Act (IRCA). Hoffman Plastic Compounds, Inc. v. N.L.R.B. (U.S. 2002). The Hoffman decision is limited to the NLRA only, as undocumented workers may recover back pay under other laws like the federal Fair Labor Standards Act. In Hoffman, the employee violated the Immigration Reform and Control Act (IRCA) by presenting fraudulent documents to his employer and misleading the employer into believing he had work authorization. In contrast, in Palma, the workers did not present fraudulent documents to the employer—the employer instead failed to verify their employment eligibility.
The National Labor Relations Board (NLRB) reversed the administrative law judge’s decision and dismissed the back pay award, finding that Hoffman broadly prohibits NLRA back pay awards to undocumented workers regardless of who was at fault for the employee’s work ineligibility. The labor organizations appealed the NLRB’s deicison to the Second Circuit. The Second Circuit agreed that back pay was not appropriate, but remanded the case back to the NLRB to determine whether the workers should be reinstated.