Rehearing en banc granted by order filed 12/17/96;
published opinion filed 9/13/96 is vacated.
PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

OBIORA E. EGBUNA,
Plaintiff-Appellant,

v.

TIME-LIFE LIBRARIES, INCORPORATED,
                                                                      No. 95-2547
Defendant-Appellee.

EQUAL EMPLOYMENT OPPORTUNITY
COMMISSION,
Amicus Curiae.

Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Albert V. Bryan, Jr., Senior District Judge.
(CA-95-197)

Argued: May 8, 1996

Decided: September 13, 1996

Before RUSSELL and ERVIN, Circuit Judges, and NORTON,
United States District Judge for the District of South Carolina,
sitting by designation.

_________________________________________________________________

Reversed and remanded by published opinion. Judge Ervin wrote the
majority opinion, in which Judge Norton joined. Judge Russell wrote
a dissenting opinion.

_________________________________________________________________

COUNSEL

ARGUED: John P. Racin, WEISSBRODT, RACIN & MIELKE,
Washington, D.C., for Appellant. Samuel Alan Marcosson, Office of
General Counsel, EQUAL EMPLOYMENT OPPORTUNITY COM-
MISSION, Washington, D.C., for Amicus Curiae. Donald R. Living-
ston, AKIN, GUMP, STRAUSS, HAUER & FELD, L.L.P.,
Washington, D.C., for Appellee. ON BRIEF: Nina J. Ginsberg,
DIMURO, GINSBERG & LIEBERMAN, P.C., Alexandria, Virginia,
for Appellant. C. Gregory Stewart, General Counsel, Gwendolyn
Young Reams, Associate General Counsel, Vincent J. Blackwood,
Assistant General Counsel, Office of General Counsel, EQUAL
EMPLOYMENT OPPORTUNITY COMMISSION, Washington,
D.C., for Amicus Curiae. Lawrence D. Levien, Neil J. Welch, Jr.,
Harry J. F. Korrell, AKIN, GUMP, STRAUSS, HAUER & FELD,
L.L.P., Washington, D.C., for Appellee.

_________________________________________________________________

OPINION

ERVIN, Circuit Judge:

We must decide whether a Title VII plaintiff must demonstrate that
he is eligible to work in the United States under the Immigration
Reform and Control Act of 1986 to establish a prima facie case of
employment discrimination. We find that work eligibility is not part
of the prima facie case, and therefore reverse the district court's sum-
mary judgment.

I.

Appellant Obiora Egbuna, a Nigerian national, was employed by
appellee Time-Life Libraries ("TLLI") from June 1989 until April
1993. When Egbuna was initially hired, he was authorized by the
Immigration and Naturalization Service ("INS") to work in the United
States. Harrison Jackson, a TLLI employee whom Egbuna supervised,
reported to Egbuna that he had been sexually harassed by another
employee; Egbuna cooperated with TLLI's internal investigation and
corroborated some of Jackson's allegations. In April 1993, Egbuna
voluntarily resigned from TLLI, but sought reemployment in June
1993. By this time, Egbuna's authorization to work in the United
States had expired, and in fact had expired before the end of his prior
employment with TLLI. Although the company apparently initially

                     2
offered to rehire him, TLLI ultimately withdrew this offer, claiming
that Egbuna had not followed company policy in reporting Jackson's
complaints.

Egbuna sued TLLI, alleging that the company had refused to rehire
him because of his participation in enforcement proceedings related
to Jackson's complaints, in violation of Title VII, 42 U.S.C. § 2000e-
3(a) (1988). The district court required Egbuna to prove that he was
qualified for the position he sought in order to show that he was a vic-
tim of discrimination. Memorandum Opinion, in Joint Appendix at
93-94 (citing McDonnell Douglas Corp. v. Green, 411 U.S. 792
(1973)). Because Egbuna lacked employment authorization (a "green
card"), he could not show that he was qualified, the court found.
Accordingly, the court granted summary judgment for TLLI. Egbuna
timely filed his notice of appeal; Fourth Circuit jurisdiction thus lies
under 28 U.S.C. § 1291.

II.

Summary judgments are reviewed de novo on appeal. E.g., Higgins
v. E.I. Du Pont de Nemours & Co., 863 F.2d 1162, 1167 (4th Cir.
1988); Felty v. Graves-Humphreys Co., 818 F.2d 1126, 1127-28 (4th
Cir. 1987).

This appeal involves the interaction of two separate federal stat-
utes. One is Title VII, which makes it unlawful to discriminate in
employment. 42 U.S.C. § 2000e et seq. The second is the Immigration
Reform and Control Act of 1986 ("IRCA"), which makes it illegal to
knowingly employ an unauthorized alien. 8 U.S.C.A. § 1324a(a)(1)
(Supp. 1996). We must decide whether an undocumented alien--
ineligible to work under the IRCA--may bring a Title VII action for
failure to hire. This is a question of first impression in this circuit.

Egbuna sued TLLI under 42 U.S.C. § 2000e-3(a), which provides
that it is an illegal employment practice to discriminate against an
applicant for employment "because he has opposed any practice made
an unlawful employment practice by this subchapter, or because he
has made a charge, testified, assisted, or participated in any manner
in an investigation, proceeding, or hearing under this subchapter."
This court has explained that the proof scheme set forth in McDonnell

                    3
Douglas Corp. v. Green, 411 U.S. 792, 802-04 (1973), applies in
§ 2000e-3 retaliation claims.1 Ross v. Communications Satellite Corp.,
759 F.2d 355, 365 (4th Cir. 1985). First, the employee must make out
a prima facie case of retaliation by showing three elements: "1) the
employee engaged in protected activity; 2) the employer took adverse
employment action against the employee; and 3) a causal connection
existed between the protected activity and the adverse action."2 Id.
Once a prima facie case is established, the employer may proffer a
legitimate, nondiscriminatory reason for its action, which rebuts the
presumption of retaliation. Id. This shifts the burden back to the
employee, who must show that the employer's reason is pretextual.
Id.

TLLI concedes that Egbuna engaged in protected activity, and that
it did not rehire him. Thus, Egbuna has met the first two requirements
of a prima facie case. TLLI argues that the only issue at the summary
judgment stage was "whether Egbuna, who could not have been hired
by TLLI, can demonstrate a causal connection between the protected
activity and TLLI's failure to employ him." Id. Egbuna argues that he
has satisfied the minimal requirements of the prima facie case stan-
dard, including the third element, by alleging that"the Company
declined to [rehire him] based solely upon his witness status."

As far as we can determine, only one other court has addressed the
specific question before us here,3 and that court held that unauthorized
_________________________________________________________________

1 This is an unusual case in that Egbuna alleges that the failure to hire
was retaliatory. Usually, someone who is not hired does not have a prior
relationship with the employer and the refusal to hire is alleged to have
been discriminatory rather than retaliatory.

2 Although the Ross court explained that the illegal conduct must be the
"but-for" cause of the challenged action in the retaliation context, the
Civil Rights Act of 1991 amended Title VII to provide that a statutory
violation has occurred if "race, color, religion, sex, or national origin was
a motivating factor for any employment practice, even though other fac-
tors also motivated the practice." 42 U.S.C. § 2000e-2(m) (Supp. III
1991). The Civil Rights Act does not specifically address unlawful
employment practices as defined by § 2000e-3(a), the statute under
which Egbuna seeks recovery.

3 Before the enactment of the IRCA, the Supreme Court acknowledged
that Title VII protects aliens against discrimination. Espinoza v. Farah

                     4
aliens are protected under Title VII despite the provisions of the
IRCA. EEOC v. Tortilleria "La Mejor", 758 F. Supp. 585, 593-94
(E.D. Cal. 1991). An undocumented-alien employee filed a Title VII
sex discrimination claim. Id. at 586. The court found that Title VII
applied to undocumented aliens, and noted that the EEOC has always
so construed the statute. Id. at 589. The court then considered whether
the enactment of the IRCA altered the scope of Title VII's protec-
tions, and concluded that "Congress did not intend that the IRCA
amend or repeal any of the previously legislated protections of the
federal labor and employment laws accorded to aliens, documented or
undocumented, including the protections of Title VII." Id. at 592-94;
see also EEOC v. Hacienda Hotel, 881 F.2d 1504, 1517 n.10 & n.11
(9th Cir. 1989) (assuming, without deciding, "that the undocumented
workers in this case were entitled to the protections of Title VII," but
noting that the IRCA "may well . . . change[ ] the mix of policy con-
siderations underlying the case law which supports our conclusion
that undocumented employees may recover back pay in a Title VII
action").

In a Fair Labor Standards Act ("FLSA") case, the Eleventh Circuit
found that the IRCA did not effect the FLSA's application to undocu-
mented aliens, in part based on the principle that"amendments by
implication are disfavored." Patel v. Quality Inn South, 846 F.2d 700,
704-05 (11th Cir. 1988), cert. denied, 489 U.S. 1011 (1989). That
court concluded that there was no policy conflict created by applying
both statutes:
_________________________________________________________________

Mfg. Co., 414 U.S. 86, 95 (1973). In Sure-Tan, Inc. v. NLRB, 467 U.S.
883 (1984), also decided before the IRCA, the Supreme Court held that
undocumented aliens are considered "employees" within the definition of
the National Labor Relations Act. Id. at 892 (1984). The Sure-Tan Court
specifically noted that the Immigration and Nationality Act ("INA"),
which regulated entry into the United States, did not make it "unlawful
for an employer to hire an alien who is present or working in the United
States without appropriate authorization." Id. at 892-93. Because the INA
did not proscribe the relationship between employer and undocumented-
alien employee, there was no conflict presented by applying both the
INA and the NLRA. Id. at 893. In contrast to the INA, the IRCA prohib-
its employers from hiring employees without green cards, 8 U.S.C.A.
§ 1324a(a)(1), and requires verification of each potential employee's sta-
tus, id. § 1324a(b).

                    5
          Congress enacted the IRCA to reduce illegal immigration by
          eliminating employers' economic incentive to hire undocu-
          mented aliens. To achieve this objective the IRCA imposes
          an escalating series of sanctions on employers who hire such
          workers. See 8 U.S.C. § 1324a. The FLSA's coverage of
          undocumented workers has a similar effect in that it offsets
          what is perhaps the most attractive feature of such workers
          --their willingness to work for less than the minimum wage.
          If the FLSA did not cover undocumented aliens, employers
          would have an incentive to hire them. Employers might find
          it economically advantageous to hire and underpay undocu-
          mented workers and run the risk of sanctions under the
          IRCA.

          . . . By reducing the incentive to hire such workers the
          FLSA's coverage of undocumented aliens helps discourage
          illegal immigration and is thus fully consistent with the
          objectives of the IRCA. We therefore conclude that undocu-
          mented aliens continue to be "employees" covered by the
          FLSA.

Id. at 705.

The crux of TLLI's argument rests on its claim that Egbuna was
not qualified to work. The company argues that Egbuna's lack of
work authorization rendered him unqualified, resulting in an inability
to make a prima facie case of retaliatory failure to hire; therefore,
TLLI argues, it need not make any showing of its motive as required
by the second stage of the McDonnell Douglas framework. But
Egbuna argues that this court "should reject[TLLI's] effort to shield
its otherwise unlawful conduct by reference to immigration law that
it knowingly violated for a period of forty months."4

Both Egbuna and the EEOC, as amicus curiae, argue that the trial
court should not have made work authorization part of the prima facie
_________________________________________________________________

4 Under 8 U.S.C.A. § 1324a(a)(2), "[i]t is unlawful for a person or other
entity, after hiring an alien for employment . . ., to continue to employ
the alien in the United States knowing the alien is (or has become) an
unauthorized alien with respect to such employment."

                    6
case stage, but instead should have allowed TLLI to come forward
with Egbuna's undocumented status at the second stage of the
McDonnell Douglas paradigm, as the non-discriminatory motivation
for its action. Then, Egbuna argues, he could at least demonstrate a
material issue of fact as to whether TLLI's proffered justification was
pretextual:

          The parties' long employment relationship, most of which
          occurred in violation of the IRCA, [and] the glowing recom-
          mendation for reemployment from the branch manager in
          July 1993 urging creation of a virtually unique position for
          appellant [ ] were adequate to put in issue both whether the
          Company would have employed appellant in violation of
          immigration law in July 1993 and whether in the circum-
          stances the Company was likely to hold the position open
          pending appellant's receipt of work authorization.

The EEOC argues that ineligibility to work under the IRCA "repre-
sents a potential legitimate, non-discriminatory reason for an employ-
ment decision"--not a basis for exclusion from the protections of
Title VII--and "is relevant if the employer actually relied on it in
making the decision." Thus, work authorization should properly be
considered not at the prima facie case stage, but rather at the second
stage, "if and when the employer asserts it as the legitimate, non-
discriminatory explanation for the decision." The plaintiff then has
the opportunity to show that the employer's explanation is pretextual
and that its actual motivation was discriminatory.

The district court's decision endorses a proof scheme that allows
employers who have discriminated to be protected from their discrim-
ination on the basis of information on which they did not rely. In
other words, here TLLI really does not claim that it failed to rehire
Egbuna because of his undocumented status, but it nonetheless is
shielded from its possible Title VII violations because Egbuna turned
out to be undocumented. This is contrary to the Supreme Court's
decision in McKennon v. Nashville Banner Publishing Co., 115 S. Ct.
879 (1995), in which the Court held that, when an employee is fired
for an illegal reason (there a violation of the ADEA), after-acquired
evidence of a legitimate basis for termination does not shield the
employer for liability under the violated statute. Id. at 881.

                    7
This case involves two separate issues, despite TLLI's interest in
collapsing the two. TLLI may very well have violated Title VII; and
Obiora Egbuna did not have work authorization at the time he sought
to be rehired by TLLI. Under the district court's ruling, TLLI would
escape all liability for its possible Title VII violation because of
Egbuna's undocumented status. That would be inappropriate. Instead,
the parties should proceed through the McDonnell Douglas frame-
work. TLLI may assert Egbuna's lack of work authorization as a
legitimate non-discriminatory basis for its decision, and Egbuna may
attempt to show that the asserted basis is pretextual.

III.

We believe that the legislative effort to fight employment discrimi-
nation by protecting those who make or support allegations of
improper conduct is best served by holding that a Title VII claimant
need not show work authorization as part of the prima facie case. This
conclusion does no damage to the distinct legislative decision to pro-
scribe the hiring of undocumented workers under the IRCA. As the
Eleventh Circuit noted, uniform application of this nation's labor laws
removes a possible economic incentive to hiring illegal workers. An
applicant's lack of work authorization remains a relevant consider-
ation; it may be proffered by an employer as the legitimate, non-
discriminatory reason for its action, and it may ultimately be relevant
to the question of remedies should a Title VII violation be established.5

We reverse the decision below and remand the case to the district
court for further proceedings consistent with this opinion.

REVERSED AND REMANDED
_________________________________________________________________

5 See Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 889, 902-03 (1984) (rein-
statement and backpay may not be appropriate for claimants who have
been deported and therefore are not "available for work"). Sure-Tan
would not necessarily dictate that Egbuna could not be reinstated or
recover backpay, however, because he received work authorization only
a short time after TLLI refused to rehire him. These factual questions are
best left for the district court to consider on remand.

                    8
RUSSELL, Circuit Judge, dissenting:

I respectfully dissent to the panel's holding to remand this case so
that the parties may litigate this question under the McDonnell-
Douglas framework. Under that framework, an employee is not to be
ordered employed unless he is qualified for the sought-after position.
To be qualified, an alien must possess the requisite employment
authorization. Egbuna is an alien without a green card. He therefore
does not qualify for employment at Time-Life Libraries, Inc., and I
do not think that, merely because he is an alien, the immigration laws
should be held subject to Title VII.

                    9
