Worker FactoryEmployers will want to pay close attention to the California Supreme Court’s pending decision in Salas v. Sierra Chemical Co. (a case we blogged about last year) as it may substantially affect their exposure to liability for certain claims by undocumented employees.

In Salas, the Plaintiff (Salas) was hired and rehired by his employer (Sierra) on several occasions.   In each instance Salas produced a resident alien card and a completed I-9 form with his Social Security number.  When Sierra failed to rehire Salas after he took time off following a workplace injury, Salas asserted claims against Sierra for failure to hire based upon his disability and in retaliation for Salas’ filing a workers’ compensation claim.  Sierra sought dismissal of Salas’ lawsuit based upon its discovery that Salas used someone else’s Social Security number to obtain employment.  The trial court agreed with Sierra and dismissed Salas’ lawsuit on the basis that Salas was not eligible to work in the U.S.

Employers cheered when the Appellate Court affirmed the trial court’s ruling based upon both the “after-acquired evidence” and “unclean hands” doctrines.  The after-acquired evidence doctrine operates as a defense to termination and refusal to hire cases where an employer discovers wrongdoing that would have resulted in the challenged termination or refusal to hire.  Salas’ misrepresentation of a federal job requirement (a valid Social Security number) resulted in his lacking necessary qualifications for the position.  Accordingly, the Appellate Court concluded that Salas had no recourse for Sierra’s failure to hire him.

Additionally, the “unclean hands” doctrine requires a plaintiff to act in good faith and fairly in the controverted matter.  The Appellate Court determined that Salas had acted in bad faith by knowingly using a third party’s Social Security number.  Salas, therefore, was barred pursuant to the unclean hands doctrine.  The Appellate Court specifically rejected Salas’ claim that Senate Bill 1818 (which provides that immigration status is irrelevant to a worker’s rights under California employment laws) insofar as SB 1818 did not provide undocumented workers with greater rights by exempting them for the after-acquired evidence and unclean hands doctrines.

The employer’s victory was short-lived.  The California Supreme Court granted review of Salas in November of 2011.   Should the Supreme Court affirm the Appellate Court’s decision in Salas, employers may rest a little sounder at night knowing that they have an additional arrow in their quiver to defeat an employee’s claims for failure to hire.  The Supreme Court’s reversal of Salas, however, will give employers another reason to bolt for greener pastures as this would expose employers to liability for failing to hire workers who could not have been legally hired in the first place.