Hoffman Plastic Compounds v. Nlrb: an Invitation to Exploit

• Citation: Vol. 20 No. 2
• Publication year: 2010

Hoffman Plastic Compounds V. NLRB:
An Invitation to Exploit

Andrew Lewinter

Introduction

The Department of Labor enforces approximately 180 federal statutes that promote the welfare of 125 million workers.[1] However, the American workforce includes millions of people whose immigration status does not entitle them to work.[2] Many of these undocumented workers earn far less than the minimum wage and work in substandard conditions.[3] Additionally, many of these workers are afraid that if they dare to assert their rights, they will be deported.[4] Do federal laws that protect the American workforce apply to undocumented workers? What are the liabilities of employers who exploit such workers? A recent Supreme Court decision, Hoffman Plastic Compounds, Inc. v. NLRB,[5] leaves these questions unanswered and raises important considerations concerning the workplace rights of both undocumented and legally employed workers.[6] This Comment will discuss the impact that Hoffman Plastic Compounds, Inc. may have if interpreted narrowly and the likelihood that courts will apply it in other contexts.

Part I of this Comment will provide a chronological summary of the statutory and case law history that preceded the Supreme Court's decision in Hoffman Plastic Compounds, Inc.[7] Part II will discuss the Supreme Court's decision in Hoffman Plastic Compounds, Inc., including a discussion of the prior history of the case.[8] Part III will explore whether the Court's ruling applies to employers who knowingly hire undocumented workers.[9] Finally, Part IV will discuss the application of Hoffman Plastic Compounds, Inc. under two other important worker protection laws: the Fair Labor Standards Act[10] ("FLSA") and Title VII of the Civil Rights Act of 1964[11] ("Title VII").[12] This Comment will conclude that the Supreme Court's decision in Hoffman Plastic Compounds, Inc. is inconsistent with both labor and immigration policy.[13] Therefore, courts should interpret the decision narrowly to limit its potential for harm in the American workplace.[14]

I. Background

A. Discriminatory Discharge Under the NLRA

Section 8(a)(3) of the National Labor Relations Act ("NLRA")[15] prohibits "discrimination in regard to . . . tenure of employment . . . to encourage or discourage membership in any labor organization."[16] The National Labor Relations Board ("NLRB") is the agency that administers the NLRA.[17] The NLRB's typical remedy for a discriminatory discharge includes reinstatement of the worker to his former position and reimbursement for the amount that the worker would have earned during the period between the unlawful discharge and the reinstatement. [18] Scholars refer to this reimbursement as "back pay."[19] The period between an unlawful discharge and reinstatement is the "back pay period."[20]

B. Sure-Tan, Inc. v. NLRB: Back Pay Predicated on Legal Presence

The Supreme Court addressed the availability of back pay for an undocumented worker under the NLRA in Sure-Tan, Inc. v. NLRB,[21] but circuit courts have disagreed about the scope of the Supreme Court's holding.[22] In Sure-Tan, Inc., an employer reported to the Immigration and Naturalization Service ("INS") the presence of illegal aliens in his plant to retaliate against workers who voted to unionize.[23] The INS arrested five undocumented employees but allowed them to leave the country "voluntar[il]y" as a substitute for deportation.[24] The employer's call to the INS constituted a constructive discharge in violation of section 8(a)(3).[25]

The administrative law judge recommended that the NLRB order Sure-Tan, Inc. to offer reinstatement to the workers and to hold the offers open for six months, because the employees were out of the country.[26] The administrative law judge further suggested that the NLRB award the workers back pay for a minimum four-week period to deter Sure-Tan, Inc. from violating the NLRA in the future and to compensate the unlawfully discharged workers.[27] The NLRB postponed awarding back pay until the compliance hearing because the record did not specify when the employees would be able to legally reenter the country, rendering any award "unnecessarily speculative."[28] On appeal, the Seventh Circuit Court of Appeals modified the NLRB order.[29] The court of appeals required the employer to hold the offers open for four years to give the employees adequate time to obtain INS permission to reenter the country and reclaim their jobs.[30] Further, the court modified the award to include a six-month back pay award "for purposes of effectuating the policies of the [NLRA]."[31] The NLRB subsequently adopted the appellate court's suggested award.[32] The Supreme Court granted Sure-Tan, Inc.'s petition for certiorari to determine whether the NLRB properly awarded back pay to illegal aliens.[33]

The Supreme Court began its analysis by determining that undocumented workers were "employee[s]" within the meaning of the NLRA.[34] However, the Court prohibited the NLRB from awarding back pay "during any period when [the workers] were not lawfully entitled to be present and employed in the United States." [35] The Court reasoned that this holding was consistent with immigration policy because it conditioned NLRA remedies upon legal readmittance into the United States and discouraged illegal reentry into the United States for reinstatement.[36]

In his dissent, Justice Brennan criticized the majority on several grounds.[37] First, he asserted that the Court should have approached the case with the level of deference usually afforded to administrative agencies, because the NLRB had adopted the court of appeals' suggested award as its own.[38] Second, Justice Brennan criticized the majority decision as internally inconsistent.[39] The majority simultaneously held that undocumented workers (1) were "employees" within the meaning of the NLRA despite their illegal presence during employment and (2) could not receive back pay, the only NLRA remedy that had any effective deterrent value, because they were not legally present after the illegal discharge.[40] Justice Brennan stated that the "[t]he contradiction in the Court's opinion [was] total": the workers were protected as "employees" but "stripped of the normal remedial protections of the Act."[41]

C. Local 512, Warehouse and Office Workers' Union v. NLRB[42] ("Felbro"): The Ninth Circuit's Narrow Interpretation of Sure-Tan, Inc.

Two years after the Supreme Court's decision in Sure-Tan, Inc., the Ninth Circuit Court of Appeals, in Felbro, held that the NLRB may award back pay to an undocumented worker who remains in the United States during the back pay period.[43] In Felbro,[44] an employer violated section 8(a)(3) by discharging several workers for their union activities.[45] Although the administrative law judge had awarded the undocumented workers back pay, the NLRB determined that the Supreme Court's intervening decision in Sure-Tan, Inc. precluded the NLRB from issuing a back pay award to undocumented workers.[46] The Ninth Circuit Court of Appeals reversed the remedy portion of the NLRB order with respect to back pay.[47] The court distinguished Sure-Tan, Inc. because in that case the workers' departure to Mexico had made them unavailable to work for an indefinite period and any back pay award would consequently have been speculative.[48] Conversely, the employees in Felbro remained in the United States.[49] After finding that Sure-Tan, Inc. was not controlling, the court awarded back pay to the workers, relying on decisions pre-dating Sure-Tan, Inc.[50] Prior to the Supreme Court's decision in Hoffman Plastic Compounds, Inc., the NLRB followed the Ninth Circuit Court of Appeals' reasoning and consistently awarded back pay to remedy section 8(a)(3) violations of undocumented workers who remain in the United States during the back pay period.[51]

D. The Immigration Reform and Control Act: Congress Sanctions the Employment of Undocumented Workers

The Immigration and Naturalization Act ("INA")[52] did not prohibit the employment of undocumented workers until Congress amended it by passing the Immigration Reform and Control Act of 1986 ("IRCA"),[53] two years after the Supreme Court decided Sure-Tan, Inc.[54] The IRCA prohibits the employment of undocumented workers and provides both civil[55] and criminal[56] penalties for employers who knowingly hire undocumented workers.[57]

Congress intended IRCA's employer sanctions to deter illegal immigration by complementing the enforcement of wage and hour laws of the Fair Labor Standards Act ("FLSA") with respect to undocumented workers.[58] Congress believed that uniform enforcement of worker protection laws with respect to undocumented and legal workers alike would remove the economic incentive for employers to hire undocumented workers over legally authorized workers.[59] The IRCA's passage was a response to Congress' perception that programs intended to deter illegal immigration, by targeting the employers of undocumented workers, were not sufficiently effective and that sanctions would provide additional deterrence.[60] The IRCA's legislative history indicates that Congress intended employer sanctions to complement, rather than replace, enforcement of worker protection laws. [61]

E. Del Rey Tortilleria, Inc. v. NLRB: The Seventh Circuit Prohibits Back Pay Until Proof of Authorization to Work

In 1992, the Seventh Circuit Court of Appeals, in Del Rey Tortilleria, Inc. v. NLRB,[62] also addressed whether Sure-Tan, Inc. precluded the NLRB from awarding back pay where undocumented workers remained in the United States after their unlawful discharge.[63] The court concluded that an undocumented worker who remains in the United States after an unlawful discharge may not receive back pay for his employer's NLRA violation until he demonstrates that he was legally present and entitled to work.[64] Because NLRA back pay was a remedial measure, the court reasoned that the worker...