May an ‘Undocumented Alien’ Recover Lost Wages?

An undocumented alien is hired by a company. He climbs up a dangerous and defective ladder fifteen feet above the ground with a heavy sack over his shoulder. The ladder tips and tosses the employee to the ground where he sustains serious injuries. Are there any remedies available for him? The answer is that it depends. Another undocumented alien is hired by the same company and is fired for getting involved in organizing a union in the workplace. Can that employee recover lost wages? Once again, the answer is that it depends.

Should undocumented aliens have the same rights under the employment laws as documented aliens and citizens?

Should employers be obligated to follow applicable laws, rules and regulations regardless of whether the employee is legally entitled to work?
Pursuant to the Immigration Reform and Control Act of 1986, an employer is obligated to take the appropriate steps when hiring workers to ensure that the worker has the right to work in this country.1 The statute requires that every employer, before hiring any person, verify that the person is authorized to work in the United States. The employer has the burden to examine specified documents that confirm the person’s identity and eligibility for employment in the United States. The employer is also responsible to properly complete Form I-9, which is evidence of that examination. Form I-9 must be maintained by the employer for three (3) years after the employee is hired or for one (1) year after the employee leaves the company, whichever period is longer. If the employer fails to verify eligibility, that employer can be subject both civil and criminal penalties.2 An employee who submits false or fraudulent documents is likewise subject to criminal prosecution.3
New York Courts have drawn a sharp distinction between the rights of a person who submits false or fraudulent documents and a person who is merely not required to submit any documentation. As will be seen later, an undocumented alien who submits false documentation in order to get a job will likely be viewed as having committed a criminal act and will likely have less rights and remedies as compared to an undocumented alien who was hired by an employer who did not complete an I-9 Form.
The Balbuena Court4 faced a situation where an undocumented alien was injured while working at a construction site. In its decision, the Court recognized that the power to regulate immigration rests with the federal government, and reviewed the relevant immigration laws, their evolution over time, and the policy considerations underlying those laws, noting the increase in aliens entering United States illegally. The Immigration and Nationality Act (INA) was created in 1952 as a comprehensive federal scheme for the regulation of immigration and naturalization.5 In 1986, Congress enacted the Immigration Reform and Control Act (IRCA).6 According to the Balbuena Court, “[b]oth Congress and the President expressed the view that ‘[t]he principal means of closing the back door, or curtailing future illegal immigration, [wa]s through employer sanctions’… that were intended to ‘remove the incentive for illegal immigration by eliminating the job opportunities which draw illegal aliens into the country…. To attain this goal, the most important component of the IRCA scheme was the creation of a new ‘[e]mployment verification system’ designed to deter the employment of aliens who are not lawfully present in the United States and those who are lawfully present, but not authorized to work.7 Under this system, aliens legally present and approved to work are issued some form of documentation demonstrating their eligibility status.8 The goal was that the individual had to present documentation to the employer before the employer could hire the individual. If the required documentation is not presented, the alien cannot be hired.9
The Balbuena Court noted that “[i]t was against this federal statutory backdrop that the Supreme Court decided Hoffman Plastic Compounds, Inc. v. NLRB (citations omitted).10 In Hoffman, the Supreme Court was faced with an illegal alien who presented an employer with false documents in order to gain employment. The employee was laid off after supporting a union-organizing campaign. The NLRB found that the layoffs violated the National Labor Relations Act and ordered back pay. At a hearing before an Administrative Law Judge the employee testified that he was born in Mexico, that he was never legally admitted to or authorized to work in the United States and that he gained employment only after furnishing a birth certificate that belonged to a friend born in Texas. The ALJ found that the individual was precluded from gaining any form of relief.11 The Board reversed with respect to back pay finding that the most effective way to advance the immigration policies embodied in the IRCA was to provide the NLRA’s protections and remedies to undocumented workers in the same manner as to other employees.12
The Hoffman Court held that to allow “…the Board to award backpay to illegal aliens would unduly trench upon explicit statutory prohibitions critical to federal immigration policy. It would encourage the successful evasion of apprehension by immigration authorities, condone prior violations of the immigration laws, and encourage future violations.”13
In the Balbuena case, the defendant argued that IRCA, as construed by Hoffman, precludes an undocumented alien from recovering lost wages in a state personal injury action. The defendant reasoned that such an award would be a penalty upon an employer that is expressly preempted by IRCA. The defendant also argued that permitting the illegal alien to recover lost wages would contravene the purposes and objectives of IRCA in that it would condone past transgressions of immigration laws and encourage future violations.14
The plaintiff in Balbuena argued that he should be able to recover for earning capacity as a result of defendant’s failure to adhere to workplace safety requirements established under the state Labor Law. According to the plaintiff, precluding a lost wage claim would make it more financially attractive to hire illegal aliens, thereby undercutting the central goal of the federal act, and would further provide less of an incentive to comply with state labor law requirements contrary to the purposes of Labor Law §§200, 240(1) and §241(6).15
The Court addressed the Supremacy Clause of the U.S. Constitution and discussed “express preemption,” “field preemption” and “conflict preemption.” With respect to “express preemption,” the Court found that IRCA does not contain an express statement that it intended to preempt state laws regarding the permissible scope of recovery in personal injury actions predicated on state labor law claims.16 Instead, the Court reasoned that Congress only preempted the imposition of civil or criminal sanctions on employers of undocumented aliens, stating that the plain language appears directed at a penalty or coercive measure such as a fine for hiring undocumented aliens.17 The Court then addressed “field preemption” and found that there was nothing in the legislative history of IRCA indicating that Congress intended to affect state regulation of occupational health and safety or to limit labor protections of existing laws.18
Finally, the Balbuena Court addressed “conflict preemption” and whether the award for lost wages to an injured undocumented alien would conflict with or otherwise erode the objectives of IRCA in a manner sufficient to surmount the strong presumption against preemption.19 The Balbuena Court was concerned that employers would have less incentive to comply with the Labor Law if the rights of undocumented aliens were to be limited,20 and that the “… absolute bar to recovery of lost wages by an undocumented worker would lessen the unscrupulous employer’s potential liability to its alien workers and make it more financially attractive to hire undocumented aliens…”21 In addition, the court was concerned that, because undocumented aliens are willing to work in more dangerous, undesirable jobs and for less money that they would increase employment levels of undocumented aliens.22 The Supreme Court has recognized the broad authority that states possess to regulate the employment relationship to protect workers in their states.23 Immigration laws do not intrude into the area of what protections a State may afford these aliens.24
A sharp distinction noted by the Court was the fact that the Balbuena plaintiff, unlike the undocumented alien in Hoffman, did not commit a criminal act under IRCA. IRCA does not make it a crime to work without documentation. “We see no reason to equate the criminal misconduct of the employee in Hoffman to the conduct of the plaintiffs here since, in the context of defendants’ motions for partial summary judgment, we must presume that it was the employers who violated IRCA by failing to inquire into plaintiffs’ immigration status or employment eligibility.”25
Accordingly, the Court held that New York Labor Laws apply to all workers, whether documented or undocumented. There has been a spirited debate over the reach of Hoffman.26 It will be interesting to monitor cases in New York involving undocumented aliens, such as where an undocumented alien provides an employer with false documents. For example, what will be the exposure for an employer who knew or should have known that the documentation provided by the new employee was false? What is very clear is that it is critical for employers to remain current about the requirement to be vigilant in verifying that all employees have provided them with proper documentation prior to working.
David G. Gabor Mediator and partner at the Law Firm of Gabor & Gabor in Garden City concentrates in the areas of Labor & Em­ployment Law and is a member of the NCBA Membership Committee and the BOLD Task Force.
1. The Immigration Reform and Control Act of 1986 (8 USC §1324a).
2. 8 USC §1324a[a][1][B][1]; §1324A[E], [F]; Coque v. Wildflower Estates Developers, Inc., 58 A.D.3d 44, 49, 867 N.Y.S.2d 158, 163 (2d Dept. 2008).
3. Id.; 8 USC §1324c[a]; 18 USC § 1546[b].
4. Balbuena v. IDR Realty LLC, 6 N.Y.3d 338, 845 N.E.2d 1246, 812 N.Y.S.2s 416 (2006).
5. Id., at 351; U.S. Constitution, Article 1, §8[4].
6. Balbuena, at 352; Pub. L. 99-603, 100 U.S. Stat. 3359, as amended, 8 U.S.C. §1324a, et seq.
7. Balbuena, at 353.
8. Id., 8 USC §1324a[b][1][B], [C].
9. 8 USC §1324a[a][1].
10. Hoffman Plastic Compounds v. NLRB, 535 US 137 (2002).
11. Id., citing Sure-Tan, Inc. v. NLRB, 467 U.S. 883 (1984)
12. Id.
13. Id. at 138.
14. Balbuena, at 355.
15. Id.
16. Id. at 357.
17. Id.; 8 USC §1324a[h][2].
18. Balbuena at 357.
19. Id. at 358.
20. Balbuena at 359.
21. Balbuena at 359.
22. Id. at 360, citing Sure-Tan, Inc. v. NLRB, 467 U.S. 883, 893-894 (1986).
23. Id., De Canas v. Bica, 424 U.S. 351, 356 (1976).
24. Continental PET Tech., Inc. v. Palacias, 269 Ga.App. 561, 562-563, 604 S.E.2d 627, 630 (2004), Cert Denied, 546 U.S. 825 (2005)
25. Id.
26. Id., at 358, citing Rosa v. Partners in Progress Inc., 152 N.H.6, 868 A.2d 994 (2005); Correa v. Waymouth Farms Inc., 664 N.W.2d 324 (Minn.2003); Farmers Bros. Coffee v. Workers’ Compensation Appeals Bd., 133 Cal.App.4th 533, 35 Cal.Rptr.3d 23 (Ct.App.2005); Crespo v. Evergo Corp., 366 N.J.Super. 391, 841 A.2d 471 (App.Div.2004), certification denied 180 N.J. 151, 849 A.2d 184 (2004); Tyson Foods, Inc. v. Guzman, 116 S.W.3d 233 (Tx.Ct.App. 2003); Cherokee Indus., Inc. v. Alvarez, 84 P.3d 798 (Okla.Ct.Civ.App.2003); Madeira v. Affordable Hous. Found., Inc., 315 F.Supp.2d 504 (S.D.N.Y.2004); Veliz v. Rental Serv. Corp. USA, Inc., 313 F.Supp.2d 1317 (M.D.Fla2003); Hernandez-Cortez v. Hernandez, 2003 WL 22519678, 2003 U.S. Dist LEXIS 19780 (U.S. Dist. Ct. D.Kan., Marten, J., 01 Civ 1241).