Thinking of hiring undocumented workers? Think again. Thinking of not paying overtime? Really think again.

What happened

Feliciano Macario, Gonzalo Leal, Elmer Lucas, Esvin Lucas, Margarito Rodas, and Bernabe Villavicencio worked at Jerusalem Café from June 2007 through March 2010. The café was owned by Farid Azzeh and managed by Adel Alazzeh. None of the employees had proper employment authorization. Some of them were paid less than minimum wage, and none received overtime pay. Instead, the workers received a fixed weekly rate in cash. Their pay did not vary with the number of hours they worked.

The situation came to a head on January 23, 2010, when Macario called the police after Azzeh and Alazzeh’s nephew allegedly struck him. Azzeh offered Macario $500 to drop the charges because he was afraid the police would discover that he had illegally hired unauthorized workers. Macario refused Azzeh’s offer and was terminated. The other workers were terminated in March 2010 after they refused to falsify employment applications to create the appearance that they hadn’t worked at the café before then.

The workers filed a complaint on July 30, 2010, alleging that Azzeh willfully failed to pay minimum and overtime wages in violation of the Fair Labor Standards Act (FLSA). Azzeh responded that the workers were volunteers and that any photos and videos of them performing tasks in the restaurant were staged. In addition, he claimed that their food handler cards, issued by the Kansas City (Missouri) Health Department and listing the café as their employer, were obtained so they could volunteer at the restaurant. (The court referred to that claim as a “fantastic” story.) Azzeh and Alazzeh thought the FLSA didn’t apply to employers who illegally hire unauthorized aliens.

The jury found in favor of the workers, determining that Azzeh and Alazzeh had willfully disregarded the FLSA. The jury awarded the men $141,000 in actual damages for unpaid wages and another $141,000 in liquidated damages for the willful failure to comply with the law. The court then assessed $157,000 in legal fees and costs. Azzeh and Alazzeh appealed the decision to the 8th Circuit.

What the court of appeals said

The 8th Circuit agreed with the district court that employers that unlawfully hire unauthorized workers must still comply with federal employment laws. The court went all the way back to 1931, when jurors convicted Al Capone of failing to pay taxes on his illegal income. According to the court, there’s no reason that a business’s unlawful activities should exempt it from paying the taxes or wages it would have to pay if its actions were aboveboard. In other words, employers that break the law shouldn’t be treated more leniently than companies that try to follow the law.

The 8th Circuit held that aliens, whether they’re authorized to work or not, may recover unpaid and underpaid wages. Even if workers are undocumented, they’re employees within the meaning of the FLSA, and they can bring an action for unpaid wages and liquidated damages. Lucasv.JerusalemCafé,LLC,Civ. No. 12-2170 (8th Cir., 7/29/13).

What to remember

“Breaking one law does not give [someone] license to ignore other generally applicable laws,” according to the U.S. Supreme Court. Not only will a noncompliant employer pay back wages and liquidated damages to the workers it shortchanges, but it also may face criminal penalties and fines for its actions. If the employer’s only argument is that the workers were volunteers, it should plan on writing a big check. Courts won’t reward employers that violate immigration law by allowing them to avoid their minimum wage and overtime obligations to unauthorized workers.