A few years ago, employers in the state of Virginia were initially gratified by the Virginia’s Supreme Court’s ruling to exclude illegal immigrants from the protections of workers compensation. But in an almost immediate demonstration of the law of unintended consequences, the onslaught of litigation had employers clamoring to amend state law to explicitly include aliens, both legal and illegal.

Without the remedy of workers comp – and the careful adherence to changing state and federal obligations regarding immigration, an employer may be sued.

Admittedly, workers compensation is an imperfect system, and its imperfections vary from state to state. Nevertheless most workers compensation stakeholders would argue it is certainly better than the alternative…an injured worker as a plaintiff in a civil tort suit in front of a jury of his or her peers. Instead of statutory limited benefits, the employer is exposed to open tort award.

According to the National Conference of State Legislatures, more than 1,500 pieces of legislation related to immigration have been introduced in state legislatures in the last year. Much of this legislation creates significant new obligations for employers. Depending on the state, the penalties may include:

• fines
• loss of business license
• allowing illegally employed workers to pursue tort cases against the business
  labeling non-compliance as a felony
• loss of workers compensation exclusive remedy, and
• voided workers compensation insurance coverage entirely (requiring the employer to pay the medical and lost wages) for illegally hired workers.

As the immigrant population—both legal and illegal—continues to grow in the United States, their numbers will continue to expand among the American labor pool. This increases the chances that employers will hire aliens and suggests that their potential involvement in issues dealing with workers compensation related to these employees will also increase. As the old adage goes, “Ignorance of the law is no excuse,” and the trend in most states is to echo that sentiment with tougher laws against employers who would hire illegal aliens—perhaps to circumvent the need to pay for benefits such as workers compensation. Unfortunately, as states scurry to catch up through the legislative process, many variations make up the rugged terrain of workers compensation. Employers and their insurance advisors need to be informed and vigilant to be able to negotiate this territory successfully.

Three primary issues arise in workers compensation cases involving illegal aliens:

1. Are illegal aliens included in the definition of “employee” under state workers compensation law?

2. Does the Federal Immigration Reform and Control Act (IRCA), as interpreted by the Supreme Court’s decision, preempt state workers compensation laws?

3. If an illegal alien is an employee, does his illegal status deprive him of certain compensation benefits?

Employers must follow a checklist to determine the legal status of new hires, and follow up in writing with any new hires who cannot be verified through the Social Security Administration.

A full article addressing these areas and examples from many states is available to WorkCompEdge members on our wiki in pdf format. The “Legal status of new hires” checklist and sample letter is also new content available in the More Depth section of the Avoid Hiring Your Next Workers Comp Injury module.

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One of the few email discussion lists I participate in is a Yahoo! Groups list called “RiskList.” Recently, the topic of discussion was illegal aliens and workers compensation. Some issues discussed include whether or not these workers are covered under workers compensation laws and what kind of impact they may be having on loss experience.

Immigrant workers may be more inclined to take risks not commensurate with their skill levels. In cost-cutting measures that played a role in their hiring to begin with, they also may not receive proper safety equipment.

This blog is an abbreviated version of a longer article available to WorkCompEdge members here on our wiki. This article addresses the issue of whether or not illegal aliens are entitled to benefits under state workers compensation laws. The purpose is not to opine about the situation from a political or social standpoint, nor to comment on construction workmanship issues that have been addressed in the press.

Of 9.3 million illegal adults in this country, 7.2 million (77%) are employed and comprise about 5% of the entire U.S. workforce. However, they comprise a far more disproportionate percentage in some industries, such as 24% of farm workers, 17% of cleaning workers, 14% of construction workers, and 12% of food preparers. Within an industry, illegal workers may comprise high percentages of specific (often more hazardous) occupations…e.g., 36% of all insulation workers and 29% of all roofing employees are estimated to be illegal aliens. In general, illegal workers tend to be younger than other workers.

Because of language barriers and lack of training and experience, some experts believe that the exposure to injury may be significantly greater for illegal aliens than other workers. According to an Associated Press story, Mexican workers are about 80% more likely to die from a work injury than native-born workers. In several Southern and Western states, these workers are four times more likely to die than U.S. citizens performing similar jobs.

Given language barriers that might interfere with effective supervision and training, along with the frequent lack of experience, there is a fear that illegal aliens may be at greater risk due to several additional compounding risk factors. For example, because of the reasons many are here, they might be more inclined to take risks not commensurate with their skill levels. In cost-cutting measures that played a role in their hiring to begin with, they may not receive proper safety equipment. And, because they are inclined to avoid attention being directed at their illegal status, they may be hired or assigned to more hazardous jobs by employers who feel they are far less likely to file workers compensation claims….

….which brings us to the topic of this article, which is to answer the question, “Are illegal aliens entitled to state workers compensation benefits?” The short answer to this (as often the case with insurance coverage questions) is, “It depends.” In a significant majority of states, illegals ARE entitled to workers compensation benefits. However, this is not true in every state. In addition, the types of benefits or extent of coverage may be restricted in some states depending on a number of factors.

The arguments for and against benefits are further discussed in the full article (available to WorkCompEdge members). Whether or not an illegal alien is entitled to workers compensation benefits will be established in the state statutes or by regulatory or court decision. Are illegal aliens “employees” as defined by most state statutes? If so, are they entitled to all or some of the statutorily-prescribed benefits? In trying to answer these questions, I’ve constructed a state-by-state chart that references each state’s statute, lists any known case law or regulatory ruling, and provides commentary on whether or not it is likely that illegals are entitled to benefits:

Workers Compensation and Illegal Aliens Chart (Word document format)

As you’ll see on the chart, most states do allow illegal aliens to claim workers compensation benefits. The only state that expressly excludes benefits by statute is Wyoming. The only state that has excluded benefits across the board by court decision was Virginia, but the decision was subsequently overridden by legislation. The vast majority of other states permit at least the claiming of medical benefits by illegals. Some states (e.g., Georgia, Michigan, and Pennsylvania) attach restrictions to disability benefits. Other states (e.g., California, Nebraska, and Nevada) limit or preclude vocational rehabilitation benefits.

This chart is a work in progress, so information is not currently available for all states, but it is for most. Also, keep in mind that where case law is absent (to the best of our knowledge), any opinion about how statutory law might respond is conjecture on our part, based on how courts in other states have ruled on similar statutory wording. As statutes are reviewed and case law uncovered, this chart will be revised on an ongoing basis. If you are aware of any inaccuracies or missing information, please email corrections to me at mailto: Bill.Wilson@iiaba.net.

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