Other sources provide even higher figures. According to the Department of Homeland Security, the number of undocumented individuals in the United States is 8-12 million, while the Center for Immigration Studies puts the count at 10-11 million. Almost all sources agree that there are 700,000 to 1 million illegals entering annually, according to Richard A. Watts, an attorney in the Atlanta law firm of Swift, Currie, McGhee & Hiers.

These numbers mean that many employers and HR professionals who deal with workers' compensation will eventually have to handle claims filed by undocumented workers, Watts told attendees at a July session of the SEAK National Workers' Compensation and Occupational Medicine Conference.

Federal Law Makes It Illegal to Employ Undocumented Workers

The Immigration Reform and Control Act of 1986 (IRCA) makes it illegal to "hire or recruit or refer for a fee" an unauthorized alien. It is illegal under the act to knowingly employ an authorized worker or to "continue to employ" a worker you later find to be unauthorized.

If an employee's undocumented status becomes clear once he or she has filed for workers' compensation benefits, what then are your obligations under IRCA as well as under state workers' compensation laws? Watts asked the conference audience.

Although, he said, federal law clearly prohibits hiring these workers, once they become injured on the job, several states explicitly allow them to recover workers' compensation benefits. Statutes in Florida, New York, Texas and Utah permit the recovery of benefits by undocumented workers. In a number of other states, including Connecticut, Georgia, Louisiana, Nebraska, Ohio, Oklahoma, New Jersey, North Carolina and South Carolina, courts have held that compensation benefits cannot be denied solely because the injured worker is undocumented.

Arguments Made to Deny Benefits

Many state workers' compensation acts define an employee as "anyone under contract for hire or apprenticeship." Illegal aliens cannot legally contract. Therefore, an argument can be made, Watts said, that compensation benefits should be denied because illegals are not subject to the act in that they do not meet the definition of "employee."

This argument has been successful in courts in Arizona, Virginia and Wyoming, Watts noted, although Virginia subsequently changed its law to explicitly include illegal aliens as employees. It has not been successful in several states, including Connecticut, Georgia, Louisiana, Ohio, Oklahoma and Texas.

Another argument, Watts said, is based on the fact that many states' workers' compensation statutes deny benefits if they have been fraudulently obtained. Attorneys have argued, largely unsuccessfully, that because undocumented workers have committed fraud in obtaining their jobs, they should be disqualified from obtaining benefits.

Benefits also may be denied in many states if a worker is hurt during the commission of a crime. Attorneys have argued that, because providing false documentation to get a job is a crime, undocumented workers should be denied benefits if they are injured on the job they illegally obtained. But courts have not accepted this argument either, Watts noted.

Supreme Court Case Has Little Impact

In 2002, the U.S. Supreme Court decided in Hoffman Plastics v. NLRB (535 U.S. 137) that an undocumented worker who was terminated from employment because of his union activities was not entitled to back pay, even though the employer had violated the National Labor Relations Act in discharging him. The court ruled that IRCA would be violated by awarding "back pay to an illegal alien for years of work not performed, for wages not lawfully earned, and for a job obtained in the first instance by a criminal act."

Federal courts subsequently applied the Hoffman decision to deny claims for back pay brought by undocumented workers under the Americans with Disabilities Act and Title VII, but ruled that Hoffman was not applicable to an undocumented worker's claim for unpaid overtime under the Fair Labor Standards Act (FLSA). In the FLSA context, the employee had already earned the wages, the court reasoned, and so could not be denied based on immigration status.

In the workers' compensation area, an argument based on Hoffman has failed in six states (California, Florida, Georgia, Maryland, Minnesota and Pennsylvania), Watts said, with the courts reasoning that the situation is more like the one under the FLSA -- the employee cannot be denied the benefits because he or she had already earned them by virtue of working for the employer prior to incurring the injury.

Immigration issues are "hot" right now, Watts concluded, and states may consider legislation restricting undocumented workers' rights to collect workers' compensation benefits. A bill that would have required an individual hurt on the job to prove that he or she was legally employed passed the Ohio Senate in the last legislative session but failed to pass the House, he noted.

Joanne Deschenaux, J.D., is senior legal editor for the Society for Human Resource Management. www.shrm.org.

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