Duff: Are State's Undocumented Workers Covered by WC? It's Complicated

Thursday, April 4, 2019 | 0

In a remarkable case just decided by the Tennessee Supreme Court, Sandoval v. Williamson, the court concluded that a provision in the Tennessee Workers’ Compensation Act, “which does not allow for additional [partial] benefits ... for any employee who is not eligible or authorized to work in the United States,” is not pre-empted by federal immigration law.

Michael C. Duff

The facts are straightforward. An acknowledged undocumented worker, Sandoval, suffered an injury while working for his employer, and the parties settled a permanent partial disability claim under Tenn. Code. § 50-6-207(3)(A) (although the details of the settlement are not reported, the scope of indemnity liability is 2/3 of the employee’s pre-injury average weekly wage for the period of compensation [impairment rating times 450 weeks]).

However, Sandoval “failed to return to work” at the end of the initial compensation period, and under § 50-6-207(3)(B) filed for additional benefits to which he was arguably entitled (under an all-too-familiar but bewildering extended partial benefit formula — a complaint for another time).

But, as mentioned above, the benefit “extension” does not apply “to injuries sustained by an employee who is not eligible or authorized to work in the United States under federal immigration laws.”

There are a couple of odd features to this case/statute. First, it appears that under the statute, an undocumented worker is eligible for a partial benefit the statute calls an “original award,” (and maybe for a total benefit, too), but an undocumented worker — even the same worker — is not eligible for “increased benefits.”

Now it may be the drafters had in mind a structure in which the original injury (being the product of already unlawfully performed work that is in effect a fait accompli) should be recognized. But that subsequent benefit eligibility tacitly condones ongoing unlawful presence.

The problem from a policy standpoint is that the chosen structure over the long term simply creates cheaper workers’ compensation claims and a corresponding incentive for employers to hire undocumented workers. (Breyer’s dissent in Hoffman Plastic rings just as true to me now as it did when I first read it).

I also think the statutory structure sets up an interesting equal protection problem. Imagine two similarly situated injured workers (same injuries, etc.) — one lawfully present and one not. The lawfully present worker receives an original award and increased benefits. The undocumented worker receives only the original award.

As a state, if you want to exclude all undocumented workers from receipt any benefits, that may or may not be constitutionally permissible (even if demonstrably bad policy — the costs will simply shift somewhere else), but can you really constitutionally provide part of a benefit to one classification of worker without some explanation other than “we’re trying to comply with federal immigration policy”?

Which I imagine is why the claimant was placed in the unusual position of having to argue “offensively” with respect to pre-emption. Usually, it is insurance carriers and employers arguing that a state’s policy of permitting compensation of undocumented workers is pre-empted by federal immigration policy. The claimant in such cases is defending the state’s allowance of compensation.

Here, the claimant argued that a state’s decision not permitting compensation of undocumented workers was pre-empted by federal immigration policy. I think Tennessee’s exclusionary policy is — I’ll be nice — ill-advised. And it may even provide some creative plaintiff/claimant with an interesting equal protection argument (personally, I’d file a negligence suit in connection with an employee hurt in the workplace by arguable employer negligence, yet denied the “increased benefit”).

But I’m ultimately pleased to see the Tennessee Supreme Court join the overwhelming weight of national authority in holding that federal immigration policy does not pre-empt state workers’ compensation law. In the long run, that view will be (I am convinced and delighted to say) more protective of injured undocumented workers (in the name of simple justice) and of state workers’ compensation autonomy, an autonomy I continue to support in light of the overall reality of federal policy vacuums that I doubt I’ll outlive.

Michael C. Duff is associate dean for student programs and external relations, and is professor of law, at the University of Wyoming College of Law. This entry is republished from the Workers' Compensation Law Professors blog, with permission.