1. 1
JOHN P. HARRIS AND VINCENT M. TENTINDO
IMPLICATIONS OF
IMMIGRATION REFORM
ON THE WORKERS
COMPENSATION SYSTEM
T
heoutcomeofthegrowingdebateoverthemillionsofundocumented
workers in the United States will surely have a significant impact
on the administration of workers compensation systems across the
country.1
In Massachusetts, employers have already gotten a sense of what
this impact will be, as the state Department of Industrial Accidents (DIA)
has already resolved that injured workers who are in the country illegally
are entitled to workers compensation benefits.
UsingMassachusettsasanexample,thisarticlewillfocusonthefinancial
and administrative implications of ongoing efforts to extend workers com-
pensation coverage to undocumented workers. The article will also discuss
some initiatives of the DIA, the legislature, and public interest groups to
The Journal
of
Workers Compensation
A quarterly review of risk management and cost containment strategies
VOL. 16 NO. 1 FALL 2006

2. 2
The Journal of Workers Compensation
bring all Massachusetts employers and workers into full compliance with
the public policy of the Commonwealth to ensure safety in the workplace
for all of its workers. Finally, it will suggest several steps that all employers
should take to ensure they are complying with the law.
CURRENT STATE OF LAW
In late 2003, the reviewing board of the DIA squarely addressed the
question of whether injured workers who were in the country illegally were
entitled to state workers compensation benefits. In Medellin v. Cashman
KPA, the insurer argued that Guillermo Medellin, a native of Mexico who
was injured while working for Cashman KPA on the “Big Dig” (a Mas-
sachusetts public works project), should be barred from weekly indemnity
paymentsbecauseofhisstatusasanundocumentedimmigrantworker.2
The
insurer contended that Hoffman Plastic Compounds, Inc. v. National Labor
Relations Board, a U.S. Supreme Court decision that had just been decided
at the time of the case, preempted existing Massachusetts case law on this
topic.3
In Hoffman Plastic Compounds, the Supreme Court concluded that
the National Labor Relations Board’s “award of back pay to undocumented
immigrant workers for [their employers’] violations of the federal labor law
it administers would unduly trench upon explicit statutory prohibitions
critical to federal immigration, as expressed in IRCA [the Immigration
Reform and Control Act of 1986].”4
ThereviewingboarddisagreedwiththeinsurerandruledthatMedellin’s
contract of hire was not rendered a nullity as an illegal contract under
the law of the Commonwealth: “As expansively and eloquently discussed
by the amici, undocumented workers perform essential employer labor,
and the route to dissuading these work relationships is not to eliminate
the responsibility for injuries to such workers.”5
Consequently, Medellin
retained his entitlement to benefits. The decision was appealed to the Mas-
sachusetts Appeals Court, but it was recently withdrawn without prejudice
by the parties.6
On the surface, the financial and administrative scenario in Medellin was
simple and straightforward: Cashman KPA purchased a workers compensa-
tion insurance policy and presumably paid a premium based, in part, on
the wages of Medellin and his coworkers, without consideration of their
immigration status or nationality. Once Medellin was injured, he filed a
claim, which moved through the DIA process in a routine fashion after a
dispute arose concerning the extent of Medellin’s disability. Medellin was
awarded appropriate compensation by an administrative judge at the DIA,
along with payment of medical benefits, which included multiple surgical

3. 3
Implications of Immigration Reform on the Workers Compensation System
procedures to his right arm and shoulder, right major hand, and right knee.
At the hearing before the administrative judge, the testimony revealed for
the first time that Medellin had come to the United States on a 10-year
visitor’s visa and was working under a false Social Security number. At this
point, the insurer did not challenge Medellin’s entitlement to benefits on
the basis of his unauthorized working status; it was only afterward thatHoff-
man Plastic Compounds was decided by the U.S. Supreme Court, prompting
the insurer’s appeal to the reviewing board.
WhenthereviewingboardupheldtheawardtoMedellinnotwithstanding
theU.S.SupremeCourt’sdecisioninHoffmanPlasticCompounds,itbecame
settled law in Massachusetts that immigration status cannot be considered
in determining whether an injured worker is entitled to workers compensa-
tion benefits. (The decision also means that even if Medellin had been a
day laborer whose wages had not been included in his employer’s premium
calculation, Medellin would still have been covered by his employer’s
workers compensation policy.)
Other states are similarly addressing this same issue. The Court of Ap-
peals in Maryland has upheld the right of illegal immigrants to receive
benefits for a work-related injury.7
That court stated that denying benefits
would run contrary to the goals and principles of the workers compensa-
tion law and leave injured illegal workers with only two options: receive
no relief for work-related injuries or death (unless they qualify for welfare
benefits) or sue the employer in tort for negligence, with a potential for
unlimited damages, including for pain and suffering. The second course
would allow an end run around the exclusive remedy doctrine in most
workers compensation laws.
TheSupremeCourtofNewJerseyhasruledthatillegalimmigrantsinjured
by uninsured drivers can have their medical expenses covered by a fund
supported by fees assessed on auto insurers doing business in New Jersey.8
The court held that the term “resident” was flexible enough to include “il-
legal immigrants” working in New Jersey, even though they may be there
only transiently. While not explicitly addressing a workers compensation
claim, the language used by the court gives a fair indication that a similar
outcome would be reached for a work-related injury.
Virginia recently debated a legislative proposal to eliminate or limit
benefits available to undocumented workers under the workers compen-
sation statute for purposes of enforcing immigration laws.9
That measure,
however, was defeated when it was realized that such an approach might
actuallyprovidesomeemployerswithanadditionalincentivetohireillegal
workers, further aggravating the problem they were trying to fix.

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The Journal of Workers Compensation
A RISE IN UNINSURED EMPLOYERS AND DAY LABORERS
But what of the thousands of other workers in Massachusetts who do not
have traditional, steady employment with large employers? What about
the so-called “day laborers” who gather in the parking lots of urban home
improvementoutletsorsupermarketswaitingtobepickedupandtransported
for a day of labor by employers without workers compensation insurance
or without adequate coverage for the number of employees they will use
that day? In May 2006, the Boston Herald ran several feature stories about
this growing phenomenon in New England. For years, Southern California
and other states in the Southwest have witnessed a similar growing market
for day laborers.
Day laborers may be either illegal or legal workers, but the majority tend
tobeillegalworkersduetothelimitedoptionsofthisgroup.Asdaylaborers,
these workers are generally part of the underground economy — workers
being paid in cash and thus generating no paper trail.
One might assume that work-related injuries to undocumented workers
would remain unreported and completely left out of the mandatory workers
compensation scheme because of these workers’ fear of repercussions due to
their immigration status. This was once the case, but it is now beginning
to change. As we have witnessed since the May 1, 2006, rallies across the
nation, advocates for undocumented workers are becoming much more
organized and public. Massive demonstrations have attempted to show
the economic impact that this previously invisible workforce has on our
national economy. Undocumented workers themselves are now taking
their complaints and their aspirations to the streets and public airways on
an increasingly frequent basis.
In Massachusetts, these workers are also being assisted by the Coalition
for Occupational Safety and Health, which created the “Immigrant Safe
Work Initiative” to press for closing the gaps in government protections
for immigrant and low-wage workers. The DIA also sponsors television and
radio ads, with Bob Vila as official spokesman, to educate both employ-
ers and employees that workers compensation insurance is mandatory in
Massachusetts.
HOW “UNINSURED” CLAIMS ARE HANDLED
In Massachusetts, an undocumented worker injured while working for
an employer without workers compensation insurance can file a claim for
benefits with the state Workers’ Compensation Trust Fund. The trust fund
has a duty to defend the claim or to pay the appropriate benefits under the
law. It also has authority to join the allegedly uninsured employer to the

5. 5
Implications of Immigration Reform on the Workers Compensation System
proceedings.Thetrustfundcanalsosuetheemployerforanybenefitsitpays
to the worker. Funding for the trust fund comes from annual assessments
levied by the DIA on all employers insured for workers compensation in
the Commonwealth. In fiscal year 2005, the amount paid out for uninsured
injuries was $6,052,205 on 201 such claims.
Procedurally, the injured worker’s burden vis-à-vis the trust fund is the
same as it would be vis-à-vis the employer: The claimant must prove an
employer-employee relationship, an injury that arose out of and in the
course of employment, average weekly wage, and extent of disability. This
burden is typically hard to overcome. Because of the clandestine nature of
the employers in question — their typical aversion to maintaining written
records of their activities, their cash payment of wages with no withholding
of taxes — it is difficult for the injured worker to meet the burden of proof
on each and every element of the claim.10
Recently, however, the burden of one of these elements was lightened.
Specifically, the state legislature changed the independent contractor law
in 2004 so that there is now a “presumption of employment relationship”
for any individual performing any service for another except as specifically
excluded under the law.11
As explained in an advisory opinion by the Mas-
sachusetts Attorney General’s Office in January 2005:
The Independent Contractor Law creates a presumption that
a work arrangement is an employer-employee relationship un-
less the party receiving the services can overcome the legal
presumption of employment by establishing that three factors
are present. First, the worker must be free from the presumed
employer’s control and direction in performing the service,
both under a contract and in fact. Second, the service provided
by the worker must be outside the employer’s usual course of
business. And, third, the worker must be customarily engaged
in an independent trade, occupation, profession, or business of
the same type.12
Significantly, the change in the independent contractor law shifted not
only the presumption (that the worker was not an employee), but also who
carriedtheburdenofproof.Nowitistheputativeemployerthatmustprove
that no employment relationship existed.
This change in who carries the burden of proof means that it will now
be the trust fund that has to prove that no employment relationship existed
(in cases when it believes this to be the case). This will require that the

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The Journal of Workers Compensation
trust fund assign a staff attorney to defend the claim and that the DIA as-
sign investigators to contact the alleged employer and obtain any business
records that exist. All of this will be a significant cost to the trust fund
and the DIA, with funding for these tasks coming from assessments on the
legitimate employers who have purchased the required insurance.
In fiscal year 2005, 198 stop work orders arising from work-related ac-
cidents were issued as a result of 19,086 investigations by the DIA; 98
percent of these orders were issued against small companies with less than
10 employees. Only $284,460 in fines were collected from those uninsured
employers — less than 5 percent of the benefits actually paid out because
of uninsured injuries.
Mostclaimswillnotbepaidvoluntarilybythetrustfund,andthedispute
will need to go to a conference and a full hearing before an administrative
judge. (Approximately 95 percent of the reported injuries in Massachusetts
arevoluntarilypaidbyinsurersandonlythemorequestionableclaimsenter
the dispute resolution process.) When claims need to be fully litigated,
this slows down the “simple and summary” process of the DIA in resolv-
ing disputed claims. An increase in the number of judges, investigators,
attorneys, and trust fund staff to handle this potential influx of disputed
cases will probably be needed.
HOW MASSACHUSETTS IS ADDRESSING THE PROBLEM
In the last few years, there has been a dramatic surge in deaths due to
workplace illnesses and injuries in Massachusetts. The number of such
deaths in 2003 reached 81, up from 49 in 2002, and represented the highest
number of fatalities since 1999, according to a report by the Massachusetts
AFL-CIO and the Massachusetts Coalition for Occupational Health and
Safety. One particular industry that stood out was the hardwood floor
refinishing industry, an occupation that is overwhelmingly dominated by
Vietnamese immigrants.
There are about 500 floor refinishing contractors in Massachusetts, with
3,000 to 5,000 workers involved.13
While 85 percent of the hardwood
floor refinishers in Greater Boston are of Vietnamese descent, in other
cities across the Commonwealth, the predominantly Vietnamese business-
owners of floor refinishing companies regularly hire day laborers of other
nationalities, based on the ethnic makeup of the communities in which
the businessowners are located. In the areas around Framingham and
Natick, for example, Brazilian immigrants represent the largest group, one
that has a higher percentage of illegal immigrants than the Vietnamese.
However, regardless of their national origin or immigration status, most

7. 7
Implications of Immigration Reform on the Workers Compensation System
floor refinishers in Massachusetts work “under the table” for employers who
pay in cash and provide no insurance, no benefits, and no withholding of
payroll taxes. Those employers are not registered with the Commonwealth
and consequently are not assessed to fund the uninsured-employer claims
against the trust fund.
In order to describe the process by which undocumented workers actu-
ally enter the U.S. economy and the corrective measures that need to be
undertaken to fully legitimize those sectors of the economy, we will use this
one small industry as a case study. By looking carefully into this occupation,
we can begin to see how complex the problems are and how many differ-
ent corrective actions will be needed to fully integrate all workers into the
framework of how Massachusetts expects its workers to be treated.
Despite low wages and lack of benefits, many Vietnamese workers accept
floor refinishing jobs as a necessary first rung on the U.S. economic ladder.
All that is required to get started in this occupation is a pickup truck or
van, a few sanding machines, and inexpensive brushes and rollers for ap-
plying the finishes. Among the relatively few consumable supplies used in
this process is a highly flammable lacquer sealer, which is applied to newly
sanded hardwood floors. A number of fires and explosions have taken place
inresidentialdwellingswherefloorrefinishersweredoingtheirwork,result-
ing in at least several worker deaths and the destruction of homes.
After a highly publicized fire in September 2004 destroyed a three-fam-
ily house and killed two workers in Somerville, Massachusetts, the Floor
Finishing Safety Task Force was created by all stakeholders in the floor
refinishing industry to promote safety. This organization includes repre-
sentatives of organized labor, floor refinishing suppliers, public health and
environmental organizations, and workplace safety groups. The results of a
survey conducted by the task force found that 127 out of 144 floor refinish-
ing contractors identified in Boston had Vietnamese surnames. It was also
learned that there are basically only three floor refinishing suppliers in the
Greater Boston area that serve this industry and that more than 25 fires
in Massachusetts have been attributed to hardwood floor refinishing since
1995. The task force has been working with several state representatives
to propose licensing and other measures to promote the safety and health
of workers. Those measures would include training and certification for the
workers and provision of a floor refinishing safety fact sheet to consumers
informing them about the hazards associated with this process.
According to a May 17, 2006, article in the Boston Globe, “Nearly 85%
of local floor sanders are Vietnamese, who are attracted to well-paying jobs
that require little formal training. Michael Le, manager and co-owner of

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The Journal of Workers Compensation
Capital Wood Floor Supply, Inc., based in Roxbury, which removed its
lacquer sealers months ago, said sanders don’t need a license to work and
can make $100 a day, about twice what they would earn in minimum-wage
jobs.”
We spoke to Le recently about this industry and he informed us that
members of this particular immigrant community, having left their country
in the aftermath of a long war, reeducation camps, and widespread poverty,
were eager to take advantage of the opportunities they found in the United
States.Unfortunately,theseworkersaregenerallyunawareofthehealthrisks
in this occupation and have an understandable reluctance to register with
governmentagencies.TheimmigrantworkersalsoexpressedconcernstoLe
that workers compensation insurance and other mandatory benefits would
drive their costs up and cause them to lose the only business they know.
Le, a Vietnamese immigrant who is now a U.S. citizen and businessman,
became an active member of the task force after hearing about several of
his customers being killed: “I suddenly realized that my customers — and
their customers — were being exposed to safety hazards. I understand their
language and the need to earn a living, so I decided to help.”
Leexplainedthatusingthesafer,water-basedsealerscandoublethelabor
costs for each job because of the longer drying time between coats and the
greaternumberofsurfaceimperfectionsthatneedtobecorrectedbeforethe
job is completed: “That is why it is so important that workers and contrac-
tors be educated about the health hazards and safety risks associated with
lacquer thinners so that the resulting higher costs are uniformly factored
into job quotes by every contractor. I don’t want to see them continue to
gamble their lives in trying not [to] be underbid by rival contractors.” As a
step in this direction, Le and his two competitors have voluntarily agreed
to stop selling lacquer sealer while the legislature studies other appropriate
safety measures. In the meantime, workers in this industry are still exposed
to airborne dust and fumes from polyurethane, usually without protection
from respirators.
Floor refinishing workers continue in a risky occupation that, by and
large, fails to provide wage replacement and appropriate medical treat-
ment should they become injured on the job. What does happen, how-
ever, is that they and their families are forced to become public charges
when they do become disabled. They must then rely on state-supported
health insurance for the financially needy (MassHealth), which is funded
by taxpayers in general, rather than on insurance financed directly by
employers and indirectly by the customers for whom the floor refinishing
services are performed.

9. 9
Implications of Immigration Reform on the Workers Compensation System
WHAT ALL EMPLOYERS SHOULD DO RIGHT NOW
No one can predict exactly what new laws will emerge from the present
national debate on immigration reform. However, there are several state
and federal laws that all employers should already be complying with. Al-
though, to some extent, these laws are not rigorously enforced now, this
may soon change given the political climate.
The last time Congress attempted to address immigration reform, it
produced the Immigration Reform and Control Act (IRCA) of 1986.
That law requires all employees to complete and sign a U.S. Citizen and
Immigration Services Form I-9 (Employment Eligibility Verification) on
their first day on the job. That form notifies workers that they are obligated
to submit documentation to their employer to establish that they are au-
thorized to work in the United States. No later than the close of business
on the third day, the employer is required to review the documentation
provided by a given employee, record it on that same form, and sign the
form. All employers are required to keep the completed forms and the
attached documentation for three years after the date of hire or one year
after the date of dismissal, whichever is later.
IRCA makes it a violation for employers to knowingly employ an
illegal worker and establishes criminal penalties for doing so, albeit ones
that have not been rigorously enforced. The lack of enforcement will no
doubt change soon.
Every employer should immediately begin a systematic review of its
personnel records to ensure that this required document has been com-
pleted by all of its current workers. (In a union environment, special efforts
should be made to work with union officials if it is discovered that any
documentation is missing and if workers need to be contacted to comply
with the requirements of the IRCA so that “grievances” do not arise that
would complicate the effort. Legal counsel should be consulted early in
the planning process.)
A similar review process should be performed regarding U.S. Internal
Revenue Form W-2 (Wage and Tax Statement) or Form 1099 (Miscella-
neous Income) for tax withholding (or lack thereof), as well as for proof of
insurance coverage in those states where workers compensation insurance
is mandatory. This review should not be limited to just those individuals
who are formally identified as employees of the company. If a company
contracts with temporary-help agencies, employee-leasing companies, or
subcontractors to perform essential portions of a company’s business, the
prudent executive has a duty to ensure that those entities are in compliance
with applicable laws to the same extent that the company must comply.

10. 10
The Journal of Workers Compensation
Simply obtaining essential manpower from other entities to avoid treating
those workers as employees is no longer a viable business option.
Again citing Massachusetts as an example, the legislature is also con-
sidering a revision to the Workers’ Compensation Act that would grant
employees for whom no workers compensation coverage exists the right
to sue the putative employer for the value of the insurance premium cost
avoided. Ten or more such employees can be certified to file a class-action
suit on behalf of all the workers of an employer. Savvy business leaders need
to keep in mind that the American public is also taking a hard look at the
“corporate culture of greed” and other questionable corporate governance
practices at the same time they are watching the immigration question.
CONCLUSION
Fully integrating immigrant workers into our economic system would
involve providing them a reasonable expectation that income-tax with-
holding, Social Security taxes, insurance benefits mandated by law, and the
minimum wages established by the legislature are paid. This full integra-
tion hasn’t happened yet. Until then, immigrant workers will continue to
struggle to receive the basic benefits that most states require be provided
to all its workers. If our elected leaders fail to address this many-faceted
problem or undertake only half-hearted and incomplete corrective actions
similar to what occurred in 1986 (most of the currently proposed remedies
are identical to those enacted in 1986 except the size and scope of the
problem has greatly increased), such a course will continue to drive up
costs paid by the legitimate employers across the country. It will also drive
immigrants — both legal and illegal — further apart from the rest of us
within our economic and political system, breeding resentment and unrest,
as is currently unfolding in several European countries.
Regardless of the reader’s private view on how the federal government
should resolve this important issue of immigration control, it must be ad-
dressed in some fashion. Out-of-control workers compensation costs in
the late 1980s were one of the major factors that drove many reputable
employers away from the Commonwealth of Massachusetts and thereby
set the stage for the Commonwealth’s Workers’ Compensation Reform Act
of 1991. Today’s challenge involves more than just workers compensation
and is significantly more far-reaching. Every aspect of our social structure
and our economy is affected by this growing problem.
Members of the workers compensation insurance profession understand
how all of the components of our complex employment process interact in
our national economy. We understand the public policy that has evolved

11. 11
Implications of Immigration Reform on the Workers Compensation System
over the last century to provide a safer workplace for everyone. We work
everydaytoensurethaton-the-jobinjuriesareproperlytreatedasanintegral
cost of doing business to be borne by employers, not by general taxation.
We also understand how all of the separate strands of the United States’
social safety net must be coordinated and seamlessly meshed together for
the common good of our society. Those of us who earn our own wages
within the workers compensation industry have an obligation to provide
knowledgeable input to this important national debate. We must ensure
that a well-reasoned, thoughtful, and thorough reform is accomplished by
sharing our unique expertise with lawmakers. We owe it to our children
and ourselves. And we also we owe it to the memory of our own immigrant
ancestors who came before and struggled to create the system that has
worked so well for us.
ENDNOTES
1. In this article, “undocumented” means without the necessary documents to live and
work in the United States. In this context, it is interchangeable with “illegal.”
2. Medellin v. Cashman KPA, 17 Mass. Workers’ Comp. Rep. 592 (2003).
3. Hoffman Plastic Compounds, Inc. v. National Labor Relations Board, 535 U.S. 137
(2002).
4. Id. at 151.
5. To indicate the high degree of public interest in this case, 13 separate amicus curie
briefs were filed by various parties, in addition to the briefs of the employee and the
insurer. The 11 briefs on behalf of the employee came from the Massachusetts Attorney
General; National Employment Law Project; Greater Boston Legal Services; Harvard
Legal Aid Bureau; Karl Klare, Esq.; Western Massachusetts Legal Services; Brazilian
Immigrant Center; Massachusetts Law Reform Institute; the American Federation of
Labor and Congress of Industrial Organizations (AFL-CIO); the Massachusetts AFL-
CIO; and the New England Painting & Glazing Industries District Council 35 Joint
Trade Board. The two briefs on behalf of the insurer were received from the Workers’
Compensation Trust Fund and Zurich North America Insurance. It is very unusual
for amicus curie briefs to be filed on matters pending before the reviewing board; this
is the largest number of amici that anyone can remember.
6. A source close to the case suggested that the case was being settled by lump-sum agree-
ment, meaning that the immigration-status issue will not be subject to appellate review
and the reviewing board’s decision will remain a legal precedent in Massachusetts.
7. 882 A.2d 817 (Md. 2005).
8. 897 A.2d 1026 (N.J. 2006).
9. See Jenkins, C.L., Washington Post (March 29, 2006), at B5.
10. Even if a claimant is unable to prove what his or her average weekly wage was, this
would preclude only indemnity payments (and sometimes an estimated low average

12. 12
The Journal of Workers Compensation
weekly wage will likely be awarded by an administrative judge anyway). However, this
would have no effect on the claimant’s right to medical coverage (assuming all other
burdens of the claim are met). This category of worker is highly unlikely to have any
other health insurance or resource to pay for necessary medical care. This medical
benefit may be even more important than the wage-replacement component of the
Workers’ Compensation Act.
11. See Mass. Gen. Laws ch. 149, § 148B (2004).
12. An Advisory from the Attorney General, Chapter 193 of the Acts of 2004, Amend-
ments to Massachusetts Independent Contractor Law, Mass. Gen. Laws ch. 149, § 148
2004/2 (January 2005).
13. The majority of these Vietnamese workers have been here legally since the 1980s
with the necessary documentation to work or with full citizenship. However, about 5
percent to 10 percent came to the United States on a student or a visitor’s visa and
subsequently dropped out of school or overstayed their visa, thus now qualifying them
as illegal immigrants.
John P. Harris is the second injury fund manager atTentindo, Kendall, Canniff & Keefe,
LLP, in Boston. Prior to joining the firm, he served as an administrative judge at the
Massachusetts Department of Industrial Accidents for 10 years.Vincent M.Tentindo is
managing partner atTentindo, Kendall, Canniff & Keefe, LLP, and an adjunct professor
at New England School of Law, where he teaches a course in workers compensation.
BothHarrisandTentindofrequentlyconductseminarsonworkerscompensationtopics
for the Council on Education in Management. They can be contacted at jph@tkcklaw.
com and vmt@tkcklaw.com.
Reprinted with permission from The Journal of Workers Compensation,
Volume 16, Number 1; Fall 2006.
Copyright 2006, Standard Publishing Corp., Boston, MA.
All rights reserved.
www.spcpub.com