1. Does federal immigration policy, as expressed in the IRCA, preclude the Board from awarding back pay to an undocumented alien who has never been legally authorized to work in the United States?
2. Does the employer get off scot-free for its violation of the NLRA because back pay is not allowed?
3. Does the dissent believe that the back pay remedy best serves as a deterrent against unlawful activity that both the NLRA and the IRCA seek to prevent?

Petitioner Hoffman Plastic Compounds, Inc., custom-formulates chemical compounds for businesses that manufacture pharmaceutical, construction, and household products. In May 1988, it hired Jose Castro to operate various blending machines that “mix and cook” the particular formulas per customer order. Before being hired for this position, Castro presented documents that appeared to verify his authorization to work in the United States. In December 1988, the United Rubber, Cork, Linoleum, and Plastic Workers of America, AFL-CIO, began a union-organizing campaign at petitioner’s production plant. Castro and several other employees supported the organizing campaign and distributed authorization cards to coworkers. In January 1989, Hoffman laid off Castro and other employees engaged in these organizing activities. Three years later, in January 1992, the Board found that Hoffman had unlawfully selected four employees, including Castro, for layoff “in order to rid itself of known union supporters” in violation of Section 8(a)(3) of the NLRA. To remedy this violation, the Board ordered that Hoffman (1) cease and desist from further violations of the NLRA, (2) post a detailed notice to its employees regarding the remedial order, and (3) offer reinstatement and back pay to the four affected employees. Hoffman entered into a stipulation with the Board’s General Counsel and agreed to abide by the Board’s order.

In June 1993, the parties proceeded to a compliance hearing before an administrative law judge to determine the amount of back pay owed to each discriminatee. On the final day of the hearing, Castro testified that he was born in Mexico and that he had never been legally admitted to, or authorized to work in, the United States. He admitted gaining employment with Hoffman only after tendering a birth certificate belonging to a friend who was born in Texas. He also admitted that he used this birth certificate to fraudulently obtain a California driver’s license and a Social Security card, and to fraudulently obtain employment following his layoff by Hoffman. Based on this testimony, the ALJ found that the Board was precluded from awarding Castro back pay or reinstatement, as such relief would be contrary to Sure-Tan, Inc., v. NLRB, and in conflict with the IRCA, which makes it unlawful for employers knowingly to hire undocumented workers or for employees to use fraudulent documents to establish employment eligibility.

In September 1998, four years after the ALJ’s decision, and seven years after Castro was fired, the Board reversed with respect to back pay. Citing its earlier decision in APRA Fuel Oil Buyers Group, Inc., the Board determined that “the most effective way to accommodate and further the immigration policies embodied in [IRCA] is to provide the protections and remedies of the [NLRA] to undocumented workers in the same manner as to other employees.” The Board thus found that Castro was entitled to $66,951 of back pay, plus interest. It calculated this back pay award from the date of Castro’s termination to the date Hoffman first learned of Castro’s undocumented status, a period of 3½ years. A dissenting Board member would have affirmed the ALJ and denied Castro all back pay.

Hoffman filed a petition for review of the Board’s order in the court of appeals. A panel of the court of appeals denied the petition for review. 208 F.3d 639 (2001). The Supreme Court granted certiorari.]

REHNQUIST, C. J.…

This case exemplifies the principle that the Board’s discretion to select and fashion remedies for violations of the NLRA, though generally broad, … is not unlimited….

The Southern S.S. Co. line of cases established that where the Board’s chosen remedy trenches upon a federal statute or policy outside the Board’s competence to administer, the Board’s remedy may be required to yield. In 1986, two years after Sure-Tan, Congress enacted IRCA, a comprehensive scheme prohibiting the employment of illegal aliens in the United States. § 101(a)(1), 100 Stat. 3360, 8 U.S.C. § 1324a. As we have previously noted, IRCA “forcefully” made combating the employment of illegal aliens central to “[t]he policy of immigration law.” …

Under the IRCA regime, it is impossible for an undocumented alien to obtain employment in the United States without some party directly contravening explicit congressional policies. Either the undocumented alien tenders fraudulent identification, which subverts the cornerstone of IRCA’s enforcement mechanism, or the employer knowingly hires the undocumented alien in direct contradiction of its IRCA obligations. The Board asks that we overlook this fact and allow it to award backpay to an illegal alien for years of work not performed, for wages that could not lawfully have been earned, and for a job obtained in the first instance by a criminal fraud. We find, however, that awarding backpay to illegal aliens runs counter to policies underlying IRCA, policies the Board has no authority to enforce or administer. Therefore, as we have consistently held in like circumstances, the award lies beyond the bounds of the Board’s remedial discretion….

[A]warding backpay in a case like this not only trivializes the immigration laws, it also condones and encourages future violations. The Board admits that had the INS detained Castro, or had Castro obeyed the law and departed to Mexico, Castro would have lost his right to backpay…. Castro thus qualifies for the Board’s award only by remaining inside the United States illegally…. Similarly, Castro cannot mitigate damages, a duty our cases require, … without triggering new IRCA violations, either by tendering false documents to employers or by finding employers willing to ignore IRCA and hire illegal workers. The Board here has failed to even consider this tension. See 326 N.L.R.B., at 1063, n. 10 (finding that Castro adequately mitigated damages through interim work with no mention of ALJ findings that Castro secured interim work with false documents)….

We therefore conclude that allowing the Board to award backpay to illegal aliens would unduly trench upon explicit statutory prohibitions critical to federal immigration policy, as expressed in IRCA. It would encourage the successful evasion of apprehension by immigration authorities, condone prior violations of the immigration laws, and encourage future violations. However broad the Board’s discretion to fashion remedies when dealing only with the NLRA, it is not so unbounded as to authorize this sort of an award.