Contractor insurance fraud and why it matters

Thanks to Workers Comp Insider for alerting me to this Insurance Journal article about building contractors who cheat on their workers comp insurance. Why does this matter for immigrant workers? Because employers who cheat on insurance – buying too little, or none at all – are those mostly likely to hire vulnerable immigrant workers and cheat these workers on other labor rights. The news story said nothing about the composition of the workforce, but I bet a lot of the lower skilled work was being performed by immigrant workers. I call this combination of insurance fraud and employer abuses a toxic cocktail that can kill.

Reform proposals to protect workers comp rights of day laborers — Texas

Below is a press release about proposed legislation in Texas. In that state –uniquely — employers can opt out of (elsewhere) mandatory workers comp statutes. This increases the vulnerability of immigrant workers. The law would require employers to cover their day laborers with workers comp.
For day laborers who are illegal immigrants, a guest worker program would probably require that they be employees, rather than independent contractors, and that they be covered by workers comp as well as enjoy all other worker rights.
January 24, 2007
Bill Proposes Workers’ Compensation Coverage for Day Laborers
Recent legislation filed by Rep. Eddie Rodriquez (D-Austin) proposes that day laborers could be entitled to workers’ compensation benefits from a day laborer employer. This legislation tracks the stated goals of the Texas AFL-CIO and other organized labor groups that are once again pushing for mandatory workers’ compensation coverage during the current legislative session. Texas is the only state where some employers are allowed to opt-out of coverage.
As filed, House Bill 456 calls for day labor employers to be regulated under the authority of the Texas Commission of Licensing and Regulation. Within the actual language of this bill, one key provision states that a day labor employer “is responsible for providing a day laborer with workers’ compensation benefits to the extent required by other law.” Additionally, if this legislation passes, day labor employers would be required to provide a day laborer formal notice by the end of the laborer’s first workday. This notice would have to be in both Spanish and English and would provide notification to the laborer that workers’ compensation benefits are available in case of an injury. If applicable, this notice would also provide the name and telephone number of the employer’s workers’ compensation insurance carrier.
Also, this bill proposes that all day laborers would be required to comply with any safety and health requirements required by employers under other applicable law. Finally, in its current form, this legislation expressly forbids an employer from charging a day laborer for any safety equipment, specific clothing or other mandatory job-related accessories that may be required by law, industry custom, or by any particular employer.

NYCOSH online library on immigrant work safety

NYCOSH — the New York Committee for Occupational Safety and Health — has created a library online with many reports, news articles, and other materials about the work safety and health of immigrant workers. Most of the material is from 2002 through 2004. It was last updated in 9/06.
NYCOSH was instrumental in making sure medical assistance and worker rights counseling was made available to the 8,000 odd immigrant workers engaged in the rescue and recovery from the 9/11 attack on the World Trade Center.

Can a work injured illegal immigrant obtain benefits? In Indiana, it depends

Thanks to www.workcompcentral.com (subscription required) I have a case study of the snarl-ups often experienced today when an illegal immigrants suffers a work injury, about which there is no dispute it happened. Her or his payments can still be cut off. A guest worker program will eliminate all of these trap doors, which I have found the large majority of work injury experts are unaware of.
The matter at hand in this Indiana case is whether the injured worker is entitled to benefits after having reached “maximum medical improvement” and is still disabled – that is, simply is not going to get any better. The worker, Benjamin Marrufo, says through his lawyer that he is still not at “MMI.” The problem for him in reaching MMI is that the court may decide (as it appears to in other jurisdictions) that an illegal worker is not eligible for ongoing permanent benefits.
The article says….
Mindel [his lawyer] disputes that his client is at MMI, and said that under Indiana workers’ compensation law his client cannot request an independent medical examination because of his illegal status. To be eligible for an independent medical evaluation, an injured worker must have received total temporary disability — which an undocumented cannot collect under the law, Mindel said, adding that he doesn’t expect his client’s claim to be a test for the state high court.
Marrufo is a 47-year-old Mexican national who admittedly came to the United States eight years ago. He filed a workers’ compensation claim for a May 2006 back injury and received medical benefits.
He did not receive any temporary disability for loss of wages during his recuperation, his attorney said.
Indiana courts have not decided whether undocumented workers are entitled to workers’ compensation benefits. State courts in California, New York, Florida, Maryland, Minnesota and Alabama [and other states – PFR]have all ruled that illegal aliens are entitled to medical benefits. Most of the courts, however, have said no to wage-replacement benefits or vocational rehabilitation because the worker is in the country illegally.
A South Carolina lawmaker this year will push to exclude undocumented workers from his state’s workers’ comp system.
“My bill is a very simple bill,” Sen. Jake Knotts, R-West Columbia, was quoted as saying last month. “It says that if a person applies for workman’s compensation, they must show that they are a legal citizen.”

Barriers to occupational health services tolow wage workers in CA

The California Commission on Health and Safety and Workers Compensation, a highly visible state agency, has released its study of “Barriers to occupational health services for low-wage workers in California.” This is the largest scope and best investigated study of its kind. I have previously posted on numerous other more limited studies about garment, hotel and meat processing workers, and day laborers. I have copied below the entire Executive Summary.
This study says several important things either explicitly or by omission. First, work safety and access to workers compensation protections are pervasive problems among low wage workers — in particular, immigrant workers. The authors are effectively confirming other studies, in this broad and deep examination.
Second, the authors say by their silence that the California state agency with the greatest practical influence over correcting these problems is, well, useless. The authors appeared to have never even interviewed executives at the massive state run State Compensation Insurance Fund. SCIF is by far the largest workers comp insurer in the state, in fact the largest in the world, and whose seven person board includes three union representatives.
I queried the Commission last summer about why SCIF is not even mentioned. I did not receive a direct answer. I am left with the feeling that one state agency, CHSWC, decided that SCIF was useless as either a source of information or as a agency of work safety and workers comp system improvements.
Who are these low wage workers? The authors write, “Officially, over 3.7 million Californians are employed in occupations whose median wage is less than $10 an hour, the definition used in this report to classify workers as “low-wage.” Perhaps as many as two million more may be employed in California’s expanding underground economy. The majority of low-wage workers are nonwhite and immigrants. Typical low-wage occupations in California include restaurant and food service employees, health aides, cashiers, janitors, hotel cleaners, assemblers, security guards, farm laborers, retail clerks and sewing machine operators, among others.
“Overall, nearly two-thirds of the 25 leading occupations reporting non-fatal work-related injuries and illnesses are low-wage occupations. Heavy physical exertion, exposure to toxic substances and blood borne pathogens, repetitive motions performed bent over or in awkward postures for hours and slips, falls and other accidents are some of the common risk factors.”
The Executive Summary:

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New article: Illegal immigrants frequently denied compensation

A very well documented story was run on 9/15, by Liz Chandler of McClatchy Newspapers. about problems with access to workers comp protections for immigrant workers — in particular illegal workers. This is the best national scope journalistic report to date on this problem, which I have often addressed. she writes:

In one national study, university researchers surveyed 2,660 day laborers, most of them working illegally. One in five said he’d suffered a work injury. Among those who were hurt in the last year, 54 percent said they didn’t receive the medical care they needed, and only 6 percent got workers’ comp benefits. Employers in at least 20 states, arguing that their employees shouldn’t receive injury benefits because they’re illegal immigrants, have fought and lost in courts and review boards. Among those employees were a California laborer who hurt his back lifting sacks of coffee, an Arizona auto mechanic who was hit in the eye by flying debris, a Maryland carpenter who cut his hand on a saw, and a North Carolina construction worker who suffered a brain injury when he fell 30 feet onto a concrete floor.

the article:

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Serious breakdown in workers comp for Katrina cleanup

I have been talking with the authors of two studies of immigrant workers engaged in the Katrina cleanup. There are an estimated 10,000 immigrant workers of whom half may be undocumented. Both researchers report that very, very few of their work injuries are handled through the workers comp system. Instead, free care is used. This is a very serious problem. I expect to write more on it as more information becomes available. I have already posted on the published study done by Tulane and UC Berkeley researchers.

Study of Hispanic North Carolina Poultry Workers

A September 2005 press release by the Wake Forest University Baptist Medical Center reports that North Carolina poultry workers show a higher than reported rate of work injuries, suggesting a need for uniform enforcement of safety regulations. This study goes along with a study of Oakland garment workers and a study of Las Vegas hotel workers (to be profiled) in describing the working conditions of specific immigrant groups within a specific labor market. All of these studies suffer from a limited understanding of the dynamics of workers compensation. The lead author declined to discusss the methodology problems with this study. Yet it remains a good introduction to immigrant workers in the poultry industry.
http://www.immigrantworkerscomp.com/2006/01/study_report_on_workplace_inju.html
The survey was conducted by researchers at Wake Forest University School of Medicine in collaboration with Centro Latino of Caldwell County, Inc. The survey was based on a representative sample of Latino workers in six counties in western North Carolina: Alexander, Burke, Caldwell, Surry, Wilkes and Yadkin.
Poultry processing is the largest and fastest growing sector of the meat products industry, according to the authors. In 2002, North Carolina and four other states accounted for 70 percent of all broiler production in the United States. Many of the workers are immigrants from Mexico and Guatemala, according to the authors.

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