Lost Wages Claims for Undocumented Workers in NY

The court concluded that limiting a claim for lost wages by an injured undocumented worker would only diminish an employer's incentive to provide the safe workplace mandated by the New York Labor Law. It would also improvidently reward employers who knowingly disregarded the employment verification system, thereby defying the primary purposes of the federal immigration laws. The court noted the potential for abuse by employers if lost wage claims were denied based on immigration status:

An 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.

The claims of the Balbuena plaintiffs for lost earnings were allowed. The court stated that in the absence of proof that an undocumented worker tendered false work authorization documents to obtain employment, the IRCA did not bar maintenance of a claim for lost wages. The court of appeals did not fully address what the impact would be on a lost wage claim if an injured worker actually possessed fraudulent work authorization documents at the time of injury. The issue was not directly before the court as neither of the plaintiffs had such documents.

Thus, an unanswered question that remained after Balbuena was the viability of a claim for lost earnings where an undocumented worker had false work authorization documents. This issue is now being addressed by the trial and appellate courts. The general conclusion has been that the mere fact that an invalid Social Security card or other work authorization document is in the worker's file is not alone a basis for denial of a lost wage claim. The relevant issue is whether the employer was induced to hire the worker in reliance upon these documents, not merely that the documents were in the employer's possession.

Coque v. Wildflower Estate Developers

In Coque v. Wildflower Estate Developers, 58 A.D.3d. 44, 867 N.Y.S.2d 158 (2d Dept. 2008), the plaintiff fell from an elevation, sustaining injuries that rendered him paraplegic. He admitted that he was an undocumented worker with an invalid Social Security card. However, the court rejected the defendants' contention that because the plaintiff was an undocumented worker who submitted false documentation, he was not entitled to lost wages. The court noted that this issue was not fully considered by the Court of Appeals in Balbuena because there was no evidence that those plaintiffs had fraudulent documents.

The Second Department held in Coque that possession of a false document alone was insufficient to result in the denial of a lost earnings claim. Rather, the false documents must actually have been used to induce the employer to hire the worker. The court held that if the employer hires the worker either with knowledge of the employee's undocumented status, or without verifying the employee's eligibility for employment, the employer has not been induced by the false document to hire him. Thus, the employee has not obtained employment by submitting the false document. The court stated:

We do not believe that the Balbuena decision should be read so broadly as to stand for the proposition that a worker forfeits his or her right to recover lost earnings merely by virtue of submitting a false document at the time he or she is hired. Rather, the false document must actually induce the employer to offer employment to the plaintiff.

In addressing Balbuena, the court in Coque further noted:

Thus, the Court of Appeals did not hold that the mere submission of any false document would preclude a plaintiff from recovering damages for lost wages, but rather, that such damages would be unavailable if the plaintiff submitted such documents to obtain employment. If the employer was, or should have been, aware of the plaintiff's immigration status, and nonetheless hired the plaintiff “with a wink and a nod” ' the false document was not necessary “to obtain employment.”

The court held that barring recovery for lost earnings only where the plaintiff's submission of fraudulent documents truly induced an employer to hire the plaintiff is consistent with the objectives of both federal immigration policy and New York's Labor Law. The court reasoned that an employer should not be rewarded for its failure to comply with federal immigration law by being relieved of liability for its failure to provide a safe workplace. It expressed the concern that preventing the injured worker from recovering damages for lost wages where an employer was complicit in an illegal hiring might actually encourage violations by an employer of the federal immigration law, stating:

Although, pursuant to our holding, an employee may be entitled to recover damages for lost wages despite his or her participation in an illegal hire, such a recovery is not a reward for wrongdoing, but merely constitutes the relief to which an injured worker is normally entitled, and thus represents the status quo. Indeed, there is no reason to believe that any undocumented alien has an incentive to submit fraudulent documents in order to obtain employment with the hope of someday receiving a large award of damages for lost wages as a result of a workplace accident.

In Macedo v. J.D. Posillico Inc., 68 A.D.3d 508, 891 N.Y.S.2d 46 (1st Dept. 2009), the court concluded that the plaintiff did not forfeit his right to recover lost wages, as the evidence did not show that his employer was induced to hire him because he provided false documentation. Although the plaintiff had an invalid Social Security number, his employer failed to comply with its employment verification obligations in good faith. Similarly, in Janda v. Michael Rienzi Trust, 78 A.D.3d 899, 912 N.Y.S.2d 237(2d Dept. 2010), the court allowed a claim for past and future earnings. The court held that the evidence did not establish that the plaintiff's employer was induced to hire the worker based on his submission of false documentation. See also Wilson v. City of New York, 65 A.D.3d 906, 885 N.Y.S.2d 279 (1st Dept. 2009).

Questioning Worker's Status

Further issues addressed by the courts post-Balbuena have included whether a worker may be questioned during discovery and trial on his immigration status. In Balbuena, the court stated that under certain circumstances, it might be proper for a jury to take the plaintiff's immigration status into consideration as a mitigating factor in determining the amount of damages for future lost wages. Such circumstances might arise where the plaintiff was not totally disabled, and recovery for future lost earnings would be subject to reduction by the amount of compensation he or she could have earned in the future despite the injuries sustained.

Immigration status might be relevant as to whether a plaintiff could or could not obtain work in the future in the United States because of his legal status. The court observed that an undocumented plaintiff could, for example, introduce proof that he had or would obtain work authorization to obtain future work in the United States. Conversely, a defendant might offer evidence that a future wage award at U.S. pay scales was not appropriate because work authorization could not be obtained.

However, the Court of Appeals in Balbuena recognized that mitigation of damages was not an issue when a worker's injuries were so serious that the worker was physically unable to work. Under those circumstances, a worker would not be compelled to produce the same false documents to obtain future employment so as to mitigate his damages. As such, his immigration status was not relevant to a future lost earnings claim.

In Gomez v. F&T Int'l (Flushing, N.Y.) LLC, 16 Misc.3d 867,842 N.Y.S.2d 298 (Sup. Ct. N.Y. County, 2007), the trial court addressed the extent to which the defendants could probe an injured worker's immigration status during discovery. The plaintiffs each testified that they did not have to fill out applications or show any type of documentation. They were always paid in cash, and were never given W-2 forms. The court, criticizing not only the employers' failure to comply with hiring regulations, but also its abject failure to provide a safe workplace, opined that the onus was on the employer to ensure that it was hiring a person authorized to work. The court concluded that there was no evidence in the record that the plaintiffs used false documents to obtain employment, or that the employer required any documentation. The plaintiffs were therefore entitled to pursue a lost wage claim.

Furthermore, one of the plaintiffs sustained injuries which would prevent him from working in the future. Consequently, because he would not require work authorization in the future, his undocumented status was irrelevant, and the defendants were precluded from questioning him on that issue. With respect to the second worker, the court recognized that, although he might seek future wages based upon U.S. wage rates, he lacked work authorization. However, it would not permit defendants to question him on his immigration status. The judge rejected defendants' mitigation argument, stating:

[M]itigation encompasses an employer proving that the injured employee cannot obtain employment in New York or the USA, but only in his country of origin. The fallacy of this mitigation argument, however, is that the construction industry, especially that sector that does demolition, would re-employ Livicura without hesitation because of the very fact that he is undocumented and the employer may feel that it can pay less and not accord him the protection of the Labor Laws.

In Angamarca v. New York City Partnership Housing Development Fund Inc., 2011 WL 2448131 (1st Dept. 2011), the plaintiff, an undocumented worker from Ecuador, was hired by a third-party defendant to work at a construction site, despite its knowledge of his immigration status. This employer never requested a Social Security number and paid him in cash or by check. Payroll taxes were never withheld from his wages. The plaintiff had sustained severe injuries, including traumatic brain injury and multiple vertebral fractures, when he fell through an improperly covered opening in the roof. He was granted summary judgment on the issue of liability under Labor Law ' 240(1) and the case was tried on damages.

The defendant sought a new trial, contending that the trial court improperly precluded it from cross-examining the plaintiff and other witnesses about the plaintiff's immigration status and his alleged desire, expressed prior to the accident, of returning to Ecuador after he had earned enough money in the United States. The defendant contended that the jury should have been allowed to consider such evidence in determining its award of future lost earnings and medical costs.

The majority decision recognized that a worker's immigration status might be a factor in litigating a lost wage claim. However, it found that in this case, the trial court properly exercised its discretion in precluding the defendant from inquiring about it at trial. The court held:

In addressing mitigation concerns, the Balbuena court explicitly held that where a plaintiff has suffered serious injuries which prevent him from working ' mitigation of damages is not implicated, and therefore, his immigration status is irrelevant '

The court further addressed the somewhat unique issue raised with respect to mitigation of medical expenses. The defendant asserted that testimony as to the plaintiff's immigration status and previously expressed desire to return to Ecuador was relevant to damages because a return to his native county would result in lower medical expenses. The Appellate Division rejected this contention, stating that the defendant proffered no evidence that deportation was anything other than a speculative possibility. As such, the issue of citizenship lacked probative value in calculating damages.

In addition, the defendant admitted that it lacked relevant evidence to introduce at trial to show that if the plaintiff returned to Ecuador, his future medical expenses would have been lower than those awarded by the jury. As such, the claim was speculative on these evidentiary grounds as well. The dissenting opinion argued that the plaintiff's lack of permanent resident status was relevant to future medical expenses and should have been permitted.

Conclusion

It is clear that undocumented workers injured at construction sites have the right under New York law to present claims for their damages, which include lost earnings. The courts are attempting to resolve any conflicts between federal immigration law and state law in a manner that safeguards all workers and deprives employers of incentives to violate the safe workplace mandates of the Labor Law.

Robert S. Kelner is the senior partner at Kelner & Kelner. He is co-chair of the New York County Lawyers Civil Trial Practice Course. Gail S. Kelner is an attorney with the firm, This article also appeared in the New York Law Journal, a sister publication of this newsletter.

The law with respect to the recovery of lost wages by undocumented workers injured in accidents at construction sites in New York is gradually evolving. In the landmark decision Balbuena v. IDR Realty LLC , 6 N.Y.3d 338, 812 N.Y.S.2d 416 (2006), New York's highest court, the Court of Appeals, held that such wage claims are generally permissible. However, there were issues raised in Balbuena that are now being addressed in more detail by the courts.

The Case

In Balbuena, the Court of Appeals established that undocumented workers, who are not legally authorized to work in the United States at the time of injury, are not precluded from recovering lost wages in personal injury litigation. The Immigration Reform and Control Act (IRCA) does not preempt state laws regarding the permissible scope of recovery in personal injury actions based upon state labor laws. The court determined that the New York Labor Law applies to all workers, regardless of immigration status.

The court concluded that limiting a claim for lost wages by an injured undocumented worker would only diminish an employer's incentive to provide the safe workplace mandated by the New York Labor Law. It would also improvidently reward employers who knowingly disregarded the employment verification system, thereby defying the primary purposes of the federal immigration laws. The court noted the potential for abuse by employers if lost wage claims were denied based on immigration status:

An 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.

The claims of the Balbuena plaintiffs for lost earnings were allowed. The court stated that in the absence of proof that an undocumented worker tendered false work authorization documents to obtain employment, the IRCA did not bar maintenance of a claim for lost wages. The court of appeals did not fully address what the impact would be on a lost wage claim if an injured worker actually possessed fraudulent work authorization documents at the time of injury. The issue was not directly before the court as neither of the plaintiffs had such documents.

Thus, an unanswered question that remained after Balbuena was the viability of a claim for lost earnings where an undocumented worker had false work authorization documents. This issue is now being addressed by the trial and appellate courts. The general conclusion has been that the mere fact that an invalid Social Security card or other work authorization document is in the worker's file is not alone a basis for denial of a lost wage claim. The relevant issue is whether the employer was induced to hire the worker in reliance upon these documents, not merely that the documents were in the employer's possession.

Coque v. Wildflower Estate Developers

In Coque v. Wildflower Estate Developers , 58 A.D.3d. 44, 867 N.Y.S.2d 158 (2d Dept. 2008), the plaintiff fell from an elevation, sustaining injuries that rendered him paraplegic. He admitted that he was an undocumented worker with an invalid Social Security card. However, the court rejected the defendants' contention that because the plaintiff was an undocumented worker who submitted false documentation, he was not entitled to lost wages. The court noted that this issue was not fully considered by the Court of Appeals in Balbuena because there was no evidence that those plaintiffs had fraudulent documents.

The Second Department held in Coque that possession of a false document alone was insufficient to result in the denial of a lost earnings claim. Rather, the false documents must actually have been used to induce the employer to hire the worker. The court held that if the employer hires the worker either with knowledge of the employee's undocumented status, or without verifying the employee's eligibility for employment, the employer has not been induced by the false document to hire him. Thus, the employee has not obtained employment by submitting the false document. The court stated:

We do not believe that the Balbuena decision should be read so broadly as to stand for the proposition that a worker forfeits his or her right to recover lost earnings merely by virtue of submitting a false document at the time he or she is hired. Rather, the false document must actually induce the employer to offer employment to the plaintiff.

In addressing Balbuena, the court in Coque further noted:

Thus, the Court of Appeals did not hold that the mere submission of any false document would preclude a plaintiff from recovering damages for lost wages, but rather, that such damages would be unavailable if the plaintiff submitted such documents to obtain employment. If the employer was, or should have been, aware of the plaintiff's immigration status, and nonetheless hired the plaintiff “with a wink and a nod” ' the false document was not necessary “to obtain employment.”

The court held that barring recovery for lost earnings only where the plaintiff's submission of fraudulent documents truly induced an employer to hire the plaintiff is consistent with the objectives of both federal immigration policy and New York's Labor Law. The court reasoned that an employer should not be rewarded for its failure to comply with federal immigration law by being relieved of liability for its failure to provide a safe workplace. It expressed the concern that preventing the injured worker from recovering damages for lost wages where an employer was complicit in an illegal hiring might actually encourage violations by an employer of the federal immigration law, stating:

Although, pursuant to our holding, an employee may be entitled to recover damages for lost wages despite his or her participation in an illegal hire, such a recovery is not a reward for wrongdoing, but merely constitutes the relief to which an injured worker is normally entitled, and thus represents the status quo. Indeed, there is no reason to believe that any undocumented alien has an incentive to submit fraudulent documents in order to obtain employment with the hope of someday receiving a large award of damages for lost wages as a result of a workplace accident.

In Macedo v. J.D. Posillico Inc. , 68 A.D.3d 508, 891 N.Y.S.2d 46 (1st Dept. 2009), the court concluded that the plaintiff did not forfeit his right to recover lost wages, as the evidence did not show that his employer was induced to hire him because he provided false documentation. Although the plaintiff had an invalid Social Security number, his employer failed to comply with its employment verification obligations in good faith. Similarly, in Janda v. Michael Rienzi Trust , 78 A.D.3d 899, 912 N.Y.S.2d 237(2d Dept. 2010), the court allowed a claim for past and future earnings. The court held that the evidence did not establish that the plaintiff's employer was induced to hire the worker based on his submission of false documentation. See also Wilson v. City of New York , 65 A.D.3d 906, 885 N.Y.S.2d 279 (1st Dept. 2009).

Questioning Worker's Status

Further issues addressed by the courts post-Balbuena have included whether a worker may be questioned during discovery and trial on his immigration status. In Balbuena, the court stated that under certain circumstances, it might be proper for a jury to take the plaintiff's immigration status into consideration as a mitigating factor in determining the amount of damages for future lost wages. Such circumstances might arise where the plaintiff was not totally disabled, and recovery for future lost earnings would be subject to reduction by the amount of compensation he or she could have earned in the future despite the injuries sustained.

Immigration status might be relevant as to whether a plaintiff could or could not obtain work in the future in the United States because of his legal status. The court observed that an undocumented plaintiff could, for example, introduce proof that he had or would obtain work authorization to obtain future work in the United States. Conversely, a defendant might offer evidence that a future wage award at U.S. pay scales was not appropriate because work authorization could not be obtained.

However, the Court of Appeals in Balbuena recognized that mitigation of damages was not an issue when a worker's injuries were so serious that the worker was physically unable to work. Under those circumstances, a worker would not be compelled to produce the same false documents to obtain future employment so as to mitigate his damages. As such, his immigration status was not relevant to a future lost earnings claim.

In Gomez v. F&T Int'l (Flushing, N.Y.) LLC, 16 Misc.3d 867,842 N.Y.S.2d 298 (Sup. Ct. N.Y. County, 2007), the trial court addressed the extent to which the defendants could probe an injured worker's immigration status during discovery. The plaintiffs each testified that they did not have to fill out applications or show any type of documentation. They were always paid in cash, and were never given W-2 forms. The court, criticizing not only the employers' failure to comply with hiring regulations, but also its abject failure to provide a safe workplace, opined that the onus was on the employer to ensure that it was hiring a person authorized to work. The court concluded that there was no evidence in the record that the plaintiffs used false documents to obtain employment, or that the employer required any documentation. The plaintiffs were therefore entitled to pursue a lost wage claim.

Furthermore, one of the plaintiffs sustained injuries which would prevent him from working in the future. Consequently, because he would not require work authorization in the future, his undocumented status was irrelevant, and the defendants were precluded from questioning him on that issue. With respect to the second worker, the court recognized that, although he might seek future wages based upon U.S. wage rates, he lacked work authorization. However, it would not permit defendants to question him on his immigration status. The judge rejected defendants' mitigation argument, stating:

[M]itigation encompasses an employer proving that the injured employee cannot obtain employment in New York or the USA, but only in his country of origin. The fallacy of this mitigation argument, however, is that the construction industry, especially that sector that does demolition, would re-employ Livicura without hesitation because of the very fact that he is undocumented and the employer may feel that it can pay less and not accord him the protection of the Labor Laws.

In Angamarca v. New York City Partnership Housing Development Fund Inc., 2011 WL 2448131 (1st Dept. 2011), the plaintiff, an undocumented worker from Ecuador, was hired by a third-party defendant to work at a construction site, despite its knowledge of his immigration status. This employer never requested a Social Security number and paid him in cash or by check. Payroll taxes were never withheld from his wages. The plaintiff had sustained severe injuries, including traumatic brain injury and multiple vertebral fractures, when he fell through an improperly covered opening in the roof. He was granted summary judgment on the issue of liability under Labor Law ' 240(1) and the case was tried on damages.

The defendant sought a new trial, contending that the trial court improperly precluded it from cross-examining the plaintiff and other witnesses about the plaintiff's immigration status and his alleged desire, expressed prior to the accident, of returning to Ecuador after he had earned enough money in the United States. The defendant contended that the jury should have been allowed to consider such evidence in determining its award of future lost earnings and medical costs.

The majority decision recognized that a worker's immigration status might be a factor in litigating a lost wage claim. However, it found that in this case, the trial court properly exercised its discretion in precluding the defendant from inquiring about it at trial. The court held:

In addressing mitigation concerns, the Balbuena court explicitly held that where a plaintiff has suffered serious injuries which prevent him from working ' mitigation of damages is not implicated, and therefore, his immigration status is irrelevant '

The court further addressed the somewhat unique issue raised with respect to mitigation of medical expenses. The defendant asserted that testimony as to the plaintiff's immigration status and previously expressed desire to return to Ecuador was relevant to damages because a return to his native county would result in lower medical expenses. The Appellate Division rejected this contention, stating that the defendant proffered no evidence that deportation was anything other than a speculative possibility. As such, the issue of citizenship lacked probative value in calculating damages.

In addition, the defendant admitted that it lacked relevant evidence to introduce at trial to show that if the plaintiff returned to Ecuador, his future medical expenses would have been lower than those awarded by the jury. As such, the claim was speculative on these evidentiary grounds as well. The dissenting opinion argued that the plaintiff's lack of permanent resident status was relevant to future medical expenses and should have been permitted.

Conclusion

It is clear that undocumented workers injured at construction sites have the right under New York law to present claims for their damages, which include lost earnings. The courts are attempting to resolve any conflicts between federal immigration law and state law in a manner that safeguards all workers and deprives employers of incentives to violate the safe workplace mandates of the Labor Law.

Robert S. Kelner is the senior partner at Kelner & Kelner. He is co-chair of the New York County Lawyers Civil Trial Practice Course. Gail S. Kelner is an attorney with the firm, This article also appeared in the New York Law Journal, a sister publication of this newsletter.