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Can illegal employment risk workers’ compensation?

When it comes to your company’s workers; compensation policy, non-traditional contracts and loopholes can create significant stress, both for you as well as your employee. Injuries that occur to employees who are working illegally in California may disqualify the worker from receiving any compensation. In order to understand how this works, it is important to clarify the multiple meanings of the word “illegal” in this statement.


The International Risk Management Institute states that an employee’s contract may be illegal in two different ways. First, if the worker is required to complete tasks that violate the law, their employment is considered illegal. Most contracts do not fall under this definition, as it is generally small details concerning the hiring eligibility that determine the employee’s legality.


One example includes student employees. Some employers have found that students who are injured during summer work programs may be ineligible for worker’s compensation if they are not already registered for fall classes. The fact that they are technically not students disqualifies them from being actual employees in these programs.


In contrast, several employers in California and other areas deal with the issue of undocumented immigrants as employees. In one case where the employee lied about his U.S. citizenship status, the employer believed that worker’s compensation benefits could not be paid due to ineligibility. The state’s Supreme Court disagreed and decided that the undocumented immigrant should still be given benefits.


Since the decisions of legality and eligibility are determined on an individual case basis, this information is meant to educate and should not be taken as legal advice. 

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