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Palma v. National Labor Relations Board

United States Court of Appeals, Second Circuit

July 10, 2013


Argued: February 6, 2013.

Petition for review of orders of the National Labor Relations Board principally denying, on the basis of Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2002), backpay to undocumented alien petitioners who had been discharged by their employer in violation of the National Labor Relations Act. See 357 N.L.R.B. No. 47 (Aug. 9, 2011).

Petition denied in part and granted in part.

MATTHEW J. GINSBURG, Washington, D.C. (James B. Coppess, AFL-CIO, Washington, D.C., Marielena Hincapié, Linton Joaquin, Josh Stehlik, National Immigration Law Center, Los Angeles, California, Emily Tulli, National Immigration Law Center, Washington, D.C., on the brief), for Petitioners.

FRED B. JACOB, Washington, D.C. (Lafe E. Solomon, Acting General Counsel, Celeste J. Mattina, Deputy General Counsel, John H. Ferguson, Associate General Counsel, Linda Dreeben, Deputy Associate General Counsel, Usha Dheenan, Supervisory Attorney, MacKenzie Fillow, Attorney, National Labor Relations Board, Washington, D.C., on the brief), for Respondent.

Before: KEARSE and LOHIER, Circuit Judges, and KAPLAN, District Judge. [*]

KEARSE, Circuit Judge.

Petitioners Christian Palma et al. petition for review of a Supplemental Decision and Order of respondent National Labor Relations Board ("NLRB" or the "Board") following compliance proceedings with respect to the remedies to be ordered for violations of the National Labor Relations Act ("NLRA") by their former employer, Mezonos Maven Bakery, Inc. ("Mezonos"). It having been conceded, for purposes of the compliance proceedings, that petitioners were undocumented aliens, the Board ruled that awards of backpay to the petitioners are precluded by the Supreme Court's decision in Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2002) ("Hoffman Plastic"), interpreting the Immigration Reform and Control Act of 1986 ("IRCA"), and the Board therefore refused to approve an order of the administrative law judge ("ALJ") recommending that petitioners be awarded backpay. Petitioners contend (1) that the Board erred in interpreting the majority opinion in Hoffman Plastic to apply to aliens such as petitioners, who had not procured their jobs through the use of fraudulent documentation, and (2) that the Board erred in rejecting, without explanation, the "ALJ's reinstatement order" recommending that Mezonos be required to offer petitioners conditional reinstatement (Petitioners' reply brief on Petition for Review at 17). With respect to petitioners' latter contention, the Board argues that the absence of a Board order for, or discussion of, conditional reinstatement is not error because the ALJ's order did not include a recommendation for that relief. For the reasons that follow, we deny the petition insofar as it seeks awards of backpay; we grant the petition to the extent that it seeks a remand for the Board to consider issues relating to the request for conditional reinstatement.


Most of the facts are no longer in dispute. Petitioners and several others (collectively, the "discriminatees") are former employees of Mezonos; they engaged in protected concerted labor activity, for which they were unlawfully discharged in 2003. The merits of the unfair labor practice charge alleging that the discharges violated the NLRA were resolved by a stipulation and order, on which a judgment was entered by this Court in 2005 ("2005 Judgment" or "Judgment"); the relief to be ordered for the violations was to be conclusively determined after later proceedings. The Judgment provided, to the extent pertinent here, that Mezonos was to "make [petitioners] whole" with respect to "the amount of backpay due, if any, " 2005 Judgment ¶ 2(b) (emphasis added), and that Mezonos was to offer petitioners

unconditional reinstatement . . . except that [Mezonos] may avail itself of a compliance proceeding and therein attempt to establish that one or more of the alleged discriminatees is not entitled to an unconditional offer of reinstatement,

id. ¶ 2(a) (emphasis added).

A. The Compliance Proceedings and the ALJ's Decision

In the ensuing compliance proceedings, commenced by an NLRB Compliance Specification and Notice of Hearing ("Compliance Specification") that sought backpay and unconditional offers of reinstatement, Mezonos contended that Hoffman Plastic precluded awards of backpay and/or reinstatement in this case because petitioners were not legally authorized to work in, or to be present in, the United States. Mezonos asserted that it had in fact offered in 2003 to reinstate petitioners if they produced documentation sufficient to comply with IRCA and that none of them had presented proper documentation.

From the beginning of the evidentiary hearing before the ALJ, Mezonos sought to examine the discriminatees as to their immigration status. Counsel for the discriminatees maintained that Mezonos should be prohibited from questioning them on that subject; and the first such witness refused to answer any questions touching on his immigration status, invoking his Fifth Amendment privilege against self-incrimination (see Compliance Hearing Transcript, Aug. 8, 2006 ("Tr."), at 69-70). The ALJ ruled the questioning appropriate, and he adjourned the hearing in order to request, pursuant to § 102.31(c) of the Board's Rules and Regulations, authorization to require the discriminatees to answer such questions. Before a response to that request was received, however, the NLRB General Counsel was allowed to foreclose such questioning by conceding, for purposes of the compliance proceedings, that the discriminatees were undocumented aliens:

"[F]or the purposes of this proceeding, and only this proceeding, the General Counsel will proceed on the assumption that the discriminatees are undocumented. We have decided not to contest the issue of [the discriminatees' immigration] status in this proceeding for the purposes of expediting this matter."

ALJ Order Granting Motion To Amend Compliance Specification and Withdrawal of the Section 102.31(c) Request, dated June 2, 2006, at 1 (quoting motion of the General Counsel). Accordingly, the compliance hearing continued on the assumption that the discriminatees were undocumented aliens. The ALJ inquired whether that assumption altered the General Counsel's "request for a remedy" (Tr. 501), and he was informed that the requested relief was modified to include conditional, rather than unconditional, reinstatement (see id. at 501-02).

Following the conclusion of the hearing, the ALJ issued his decision recommending that petitioners be awarded backpay. See ALJ Supplemental Decision dated November 1, 2006 ("ALJ Decision"). The ALJ began by stating that

[t]he general question presented is whether undocumented workers who are not legally authorized to work or be present in the United States but are nevertheless covered and protected by the National Labor Relations Act (Act) are entitled to a backpay remedy.
The specific [question] to be decided is whether undocumented workers who have not engaged in fraud or criminal activity in violation of . . . IRCA[] in obtaining or continuing their employment are entitled to backpay where their employer, in violation of that statute, hired and retained them knowing that they were undocumented.

ALJ Decision at 1 (emphases added). The ALJ answered both questions in the affirmative, finding this case materially different from Hoffman Plastic because the alien in Hoffman Plastic had violated IRCA by procuring his employment by presenting the employer with fraudulent documents, and the employer was unaware of the fraud, see id. at 14.

The ALJ discredited Mezonos's president's testimony that petitioners had been asked to produce IRCA-required documentation before they were hired, and he found that "regardless of whether the employees were asked for documentation and did not produce it, [Mezonos] violated IRCA by hiring them and continuing to employ them without receiving the proper documentation." ALJ Decision at 4. The ALJ also credited the testimony of the petitioners over that of Mezonos's president with respect to the events after petitioners' discharges, finding that Mezonos had not made valid offers to reinstate petitioners if they presented proper documentation. See id. at 9.

The ALJ noted that the Compliance Specification alleged that the backpay period for petitioners began on the date of their discharge and continued to run in the absence of a valid offer of reinstatement, see id. at 4, and that the General Counsel argued that no valid offer of reinstatement had been made, see id. The ALJ noted that the Board in the past had ordered an employer who had hired employees, knowing they were undocumented aliens, to offer them immediate and full reinstatement if, within a reasonable time, they provided documentation satisfying IRCA; and he found that Hoffman Plastic did not preclude such an order of conditional reinstatement. See ALJ Decision at 9. The ALJ stated that the limited concession that petitioners here were undocumented "d[id] not answer the question concerning [Mezonos's] obligation, first to validly offer reinstatement and then to leave those offers open for a reasonable time within which they must present proof of documentation. Those obligations have not been met." Id. And because "[a]n employer's offer of reinstatement must be specific and unequivocal in order to toll backpay, " id., and "valid offers of reinstatement have not yet been made to the [discriminatees], " the ALJ found that "backpay has not been tolled, " id. at 11.

Quoting extensively from the dissent in Hoffman Plastic, the ALJ concluded that "the backpay remedy is necessary" to make "labor law enforcement credible, " ALJ Decision at 16 (internal quotation marks omitted), and is "effective in deterring future conduct, " without which, "employers have more, not less incentive to hire undocumented workers, " id. at 17.

Having concluded that Mezonos did not make valid offers of reinstatement to the discriminatees sufficient to toll its obligation to pay backpay, the ALJ proceeded to calculate the amount of backpay due each discriminatee and entered an order accordingly. See id. at 19-26. The ...

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