Last week, the California Supreme Court addressed whether undocumented immigrants may pursue state law claims of discrimination against their employers.  In Salas v. Sierra Chemical, the court held that California Senate Bill 1818, which provides state law protections and remedies to all California workers regardless of immigration status, is preempted by the Federal Immigration Reform and Control Act of 1986 (IRCA) only in regards to the award of damages for back pay after an employer learns of a worker’s employment ineligibility.  Aside from this limited exception disallowing back-pay awards after employer knowledge of undocumented status, undocumented California workers are now entitled to pursue claims for retaliation and discrimination against their employers. 

The court further held that IRCA does not preempt California state laws with regard to employees seeking damages between the time the employee is terminated and the time when the employer discovers the employee’s employment ineligibility.  However, it also held that IRCA preempts California state law where state law would require payment of wages after an employer learns of a worker’s undocumented status.  Importantly, the court limited its analysis to employers who learn of a plaintiff’s unauthorized status after the employee has been discharged.  Where an employer knowingly employs or continues to employ unauthorized workers, IRCA does not preempt state law protections, and unauthorized workers are entitled to the same wage remedies available to all California workers, including back pay.

Although the federal preemption issues in Salas may be appealed to the United States Supreme Court, California employers must be prepared to operate under the court’s current interpretation.  Now, more than ever, California employers can significantly limit their exposure to liability by ensuring compliance with IRCA’s I-9 employment authorization and document retention requirements for each employee.

The court’s ruling can be found here.

Additional Information

For more information about these decisions relating to labor and employment laws, or if you would like assistance in evaluating your compliance with IRCA employment authorization requirements, please contact your Kutak Rock attorney or the author of this alert listed.