Dealing With Illegal Aliens in Workers’ Compensation

Over the last several years, many states have confronted the issue of whether illegal aliens are entitled to workers’ compensation benefits.  This emerging topic has resulted in many claim management teams to develop strategies to deal with this complex issue.





Due to concepts of federalism, it is important that claim management teams understand the statutes and case law interpretations in the jurisdiction they are handling the claim.  There are four categories of states when it comes to workers’ compensation benefits entitlement of illegal aliens:


1. Entitlement Codified in Statute: In states such as South Carolina and Texas, the state workers’ compensation act specifically entitles persons who entered the United States illegal the ability to obtain benefits if they suffer a compensable workplace injury.


2. Entitlement via Case Law. An example of this category is the state of Minnesota.  In Correa v. Waymouth Farms, Inc., 664 N.W.2d 324 (Minn. 2003), the Minnesota Supreme Court held that the workers’ compensation statute only refers to an “employee” and the entitlement to benefits is not dependent on “legal” status.  Other states falling into this category have similar thought processes.  No challenge to this interpretation has reached the Supreme Court of the United States.  Most legal experts are of the option that such rationale would ultimately be upheld.


3. Entitlement Granted to only “Employees” of Legal Status. The number of states falling into this category is limited.  One example is the state of Wyoming, where the definition of an “employee” entitled to benefits is limited to the “legally employed…”  The Wyoming Supreme Court upheld this law following a legal challenge.


4. Entitlement Undefined. These are jurisdictions that have not addressed the issue in either statute or case law.  It is assumed that barring any statutory changes similar to those found in Category III, courts in these states would follow the rationale of the Correa case.



Practice Pointers: Essentials for Claim Management Teams


Claims involving persons working in the United States illegally can significantly increase exposure in workers’ compensation matters.  This is mainly due to the ability, or lack thereof, of an injured work to obtain gainful employment based on their disclosed employment status.


  • Treat ALL injured workers with respect and dignity. The “face” of the American worker is rapidly changing.  With this change, it is important to treat all claimants how you would want to be treated.  Do not assume that someone is in the United States illegally based on their name, primary language or other ethnic background.


  • Know the Law (and interpreting case law). Statutes and case law interpretation change.  If you are not aware of the law’s current status, be sure to consult an attorney.  It is also important to consult an attorney if you are handling a claim in Category I, II or IV jurisdictions.  Once you become aware of someone’s immigration status, it may be difficult or even illegal to have him or her engage in certain return-to-work activities.  These include aspects of job search or engaging the employer to offer that person a light-duty position.


  • Be creative. A high percentage of people in the United States illegally have limited English proficiency.  While there is no official language in this country, chances of success depend on literacy and the ability to communicate effectively.  When handing a claim involving an illegal alien, some rehabilitation services you might want to consider include courses in “English as a Second Language,” (ESL) reading courses (even in their native language) and other opportunities that increase this person’s chances of success.


  • Engage specialized vocational rehabilitation experts. The diversity of American culture has resulted in a growing number of vocational experts of differing cultural backgrounds.  This includes a greater pool of people who are multilingual and have the ability to communicate with non-English speaking persons.   Engaging companies with a wide variety of professionals will only increase your chances of closing your file and mitigating exposure.



Author Michael Stack, Principal of Amaxx Risk Solutions, Inc. He is an expert in employer communication systems and helps employers reduce their workers comp costs by 20% to 50%. He resides in the Boston area and works as a Qualified Loss Management Program provider working with high experience modification factor companies in the Massachusetts State Risk Pool.  As the senior editor of Amaxx’s publishing division, Michael is on the cutting edge of innovation and thought leadership in workers compensation cost containment.  Contact:


©2015 Amaxx LLC. All rights reserved under International Copyright Law.





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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.


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