If you want a heated discussion among insurance people, bring up the question of workers' compensation benefits for illegal immigrants. Not only will there be differences of opinion, it will also be difficult to get all the parties to refer to the illegal immigrants with the same words.
The liberals in the discussion will refer to them as undocumented workers. The conservatives in the discussion will refer to them as criminals for illegally entering the country. For this blog, let's take the middle road and refer to them as illegal immigrants.
The Pros and The Cons:
Here are a couple of the arguments for paying work comp benefits to illegal immigrants and a couple of arguments against paying benefits.
The Arguments for Paying WC Benefits to Illegal Immigrants:
1. The broad language of most state work comp statutes intend to include all workers without regards to their citizenship status.
2. The denial of work comp benefits would encourage unscrupulous employers to hire illegal immigrants as the employers would have no work comp exposure.
The Arguments Against Paying WC Benefits to Illegal Immigrants:
1. The Immigration Reform and Control Act (IRCA), a federal statute takes precedent over state laws. In the U. S. Supreme Court case of Hoffman Plastic Compounds vs. National Labor Relations Board, (not a work comp claim) the Supreme Court ruled that an illegal immigrant could not lawfully work under ICRA and prohibited compensating the illegal immigrant for work that he could not lawfully perform.
2. If the illegal immigrant commits fraud to obtain a job by swearing to his citizenship status, he does not have an enforceable employment contract.
WC Benefit Coverage for Illegal Immigrants Varies by State:
About five weeks ago there was a news item that state representative Rashida Tlaib in Michigan was introducing legislation to specifically provide workers’ compensation benefits to illegal immigrants. About three weeks ago there was an item in the news that Ohio state senator Bill Seitz was introducing legislation to bar the payment of work comp benefits to illegal immigrants.
These news item prompted some research into which states provide benefits to illegal immigrants. Just like everything else in the work comp laws, there is a lot of variation between the states. The availability of workers' compensation benefits for illegal immigrants is handled in different ways, but four general categories can be identified. They are:
1. The don't ask, don't tell states which define work comp benefit eligibility without reference to an employee's citizenship status or immigration status. This includes about 30 states.
2. The second group of states have work comp statutes that outline when benefits apply to immigrants but do so without addressing whether or not the immigrants arrived legally in the country. This includes Illinois, Michigan, Minnesota, North Dakota and Ohio.
3. The third group of states go direct to the heart of the question with work comp laws that state illegal immigrants are covered for work comp benefits, or illegal immigrants are not covered for work comp benefits. States that specifically include illegal immigrants in their workers comp coverage are California, Florida, Nevada, New York, Texas and Utah. The states that specifically exclude work comp benefits for illegal immigrants are Idaho and Wyoming.
4. The fourth group of states provides work comp benefits to “aliens and minors” who are “legally authorized to work” but do not spell out what “legally authorized to work' means. States that fall into this category include Alabama, Arizona, Colorado, Montana, North Carolina, South Carolina and Virginia.
Note: This hot-button issues is the subject of various court cases, legislative efforts and measures in several states, so there may have been recent changes in the work comp statutes of a particular state they may not be reflected in the above categories.
Related Issues:
For the jurisdictions that do not specifically exclude illegal immigrants from coverage under the work comp laws, several other benefit issues come up.
1. If the illegal immigrant status of the employee is discovered while he is off work on disability benefits (it often is), the employer cannot return the illegal immigrant to work under ICRA. How long do you pay the illegal immigrant wage loss benefits when he is not disabled, but the employer cannot take him back?
2. Can the employer offer the illegal immigrant modified duty return to work to shut off temporary total disability benefits knowing the illegal immigrant cannot come back to work?
3. What do you do about rehabilitation and vocational benefits for the permanently partial disabled illegal immigrant worker? Do you retrain them knowing they cannot accept a job in the United States? Do you retrain them for a job in their home country?
4. In states that consider employment a contract between the employer and the employee, should the contract be null and void back to the beginning when it is entered into with deception and fraud on the part of the employee? (workersxzcompxzkit)
Summary:
As this is an election year, the issue of workers' compensation benefits for illegal immigrants will continue to be a hot topic in the insurance field. The employers, the illegal immigrant employees, the insurance companies, the court systems and the various state legislative bodies will continue to be involved in the debate of this topic. The final solution is yet to be decided.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: He can be contacted at: [email protected] or 860-553-6604.
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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
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