By Caelan Brady (Kovacich Snipes Johnson) & Matthew Murphy (Murphy Law Firm)
Many of us have received a call from an undocumented worker who was injured at work. An “undocumented worker” is someone who either illegally entered the United States or who legally entered but whose visa expired. These workers often do not speak English, have not filed a workers’ compensation (WC) claim, have no understanding of the workers’ compensation system, are concerned about deportation, and are completely unaware of their options. They are also often misguided and/or obstructed by their time-of-injury employer. Many practitioners are hesitant to help undocumented workers, but these claims deserve thorough investigation.
The Immigrant Legacy in Montana
Today, many think of California, Washington, and Oregon as states with large immigrant populations. In the early twentieth century, however, Montana had more immigrants than any other state west of the Mississippi except North Dakota. In 1890, a year after Montana became a state, 32% of Montanans were foreign-born. Montana’s history is deeply intertwined with the contributions of immigrant workers, particularly involving the state’s railroads and mining activities.[i]
Immigrant labor was crucial in the construction of Montana’s railroads, which played a vital role in the state’s development. For example, the Northern Pacific Railway, completed in 1883, relied heavily on Chinese, Irish, and Scandinavian laborers.[ii] The construction of railroads had a significant impact on Montana’s landscape and economy. It facilitated the growth of industries such as mining and timber, led to the establishment of new towns, and brought thousands of newcomers to the state.[iii]
Immigrants have also played a major role in the development of Montana’s natural resources. For example, in the late 19th and early 20th centuries, Butte emerged as a major copper mining center, attracting thousands of immigrants seeking employment and a better life. The city became known for its diverse ethnic neighborhoods, with immigrants from all over the world.[iv]
Montana’s Statutory Authority Regarding Undocumented Workers
Montana law expressly extends coverage to undocumented workers: “aliens . . . whether lawfully or unlawfully employed.” For this reason, Montana law is notably inclusive. In relevant part, the statute reads:
Employee, worker, volunteer, volunteer firefighter, and volunteer emergency care provider defined — election of coverage.
(1) As used in this chapter, the term “employee” or “worker” means:
(a) each person in this state, including a contractor other than an independent contractor, who is in the service of an employer, as defined by 39-71-117, under any appointment or contract of hire, expressed or implied, oral or written. The terms include aliens and minors, whether lawfully or unlawfully employed …
Mont. Code Ann. § 39-71-118(a) (emphasis added).
Section 118 was originally enacted in 1915, likely in response to the growing number of immigrant workers during that period. In 1925, Section 118 was amended to add the term “alien.” Unfortunately, Legislative records from 1915 and 1925 are not available to further elaborate on the drafters’ intent. Nonetheless, it has been the law in Montana for over 100 years that undocumented workers are entitled to workers’ compensation coverage.
Since then, there have been legislative attempts to limit coverage for undocumented workers. In 2011, House Bill 71 proposed to exclude certain immigrants from benefits. While HB 71 failed, there is ongoing debate regarding undocumented workers’ rights in Montana.
Comparison with Other States
Montana’s inclusive approach to workers’ compensation for undocumented workers is neither unique nor universal. Many states have similar inclusive statutes.[v] Currently, Wyoming is the only state that completely excludes undocumented workers from workers’ compensation coverage by statute.[vi] In many states, case law provides coverage to undocumented workers, at least to some degree, absent an explicit statute. In others, the issue is undecided.
Undocumented Workers in Montana Post-COVID
While Montana has shown strong labor market growth for the past two decades, workers’ compensation attorneys should expect a significant increase in undocumented worker claims since COVID. From January 2020 to July 2024, Montana experienced an 88% surge in foreign-born employment, significantly outpacing the national average.[vii] Montana’s labor-intensive and fastest-growing industries[viii] likely necessitate that Montana employers will continue to rely on undocumented workers to meet labor demands.
The Immigration Reform and Control Act (IRCA) and Workers’ Compensation
The Immigration Reform and Control Act of 1986 (IRCA) is a comprehensive federal law aimed at curbing illegal immigration. IRCA made it unlawful to hire or continue to employ undocumented workers and introduced penalties for employers who knowingly hire undocumented workers.[ix] However, IRCA does not explicitly address workers’ compensation for undocumented workers.
Some employers and workers’ compensation insurers have attempted to argue that IRCA preempts state workers’ compensation laws with respect to undocumented workers, potentially precluding them from recovering benefits. However, this argument has typically been unsuccessful in court.[x]
Most courts have rejected the preemption argument, relying on the following points:[xi]
- Congress did not intend to preempt state labor laws when it passed the IRCA.
- The IRCA’s focus is on employment of undocumented workers, not on their eligibility for workers’ compensation.
- Denying workers’ compensation to undocumented workers could incentivize employers to hire them, contrary to the IRCA’s intent.
In 2011, the U.S. Supreme Court declined to weigh in on this question when it denied certiorari review of the Court of Appeal of Louisiana’s decision in Rodriguez.[xii]
While many courts have held that IRCA does not preempt state workers’ compensation laws, the fact that undocumented workers are unable to obtain lawful employment in the United States—because of IRCA—has nonetheless led to disparate outcomes on the availability of certain types of workers’ compensation benefits in some states. For example, a Michigan court ruled that undocumented workers are entitled to medical benefits but are not entitled to disability benefits because they committed a crime in violating IRCA.[xiii] Similarly, in Nebraska, vocational rehabilitation benefits are unavailable to undocumented workers because they are unable to return to some form of employment in the United States, contrary to the apparent purpose of such services.[xiv] Conversely, in Nevada, vocational rehabilitation benefits are covered due to the fact that a worker could obtain employment outside the United States.[xv]
Representing Undocumented Workers in Montana
When a Montana workers’ compensation attorney encounters an injured undocumented worker seeking representation, several unique considerations come into play:
1. Inclusive Definition of “Employee” or “Worker” and Availability of Benefits:
While many undocumented workers may be intimidated by unscrupulous employers into not filing claims, it is crucial to remember that Montana’s definition of “employee” or “worker” is highly inclusive. Although the specific issue of the availability of workers’ compensation to undocumented workers has not yet been addressed by the Workers’ Compensation or Montana Supreme Courts, Section 118’s broad definition provides a strong legal basis for undocumented workers to pursue claims for the full range of benefits available under Montana’s Workers’ Compensation Act.
Under Montana law, all types of compensation benefits, including wage loss (Mont. Code Ann. §§ 39-71-701 through 703) and vocational rehabilitation (Mont. Code Ann. § 39-71-1006) are available to “workers.”[xvi] Given the inclusive definition in Section 118, there is a strong argument that all benefits available to other injured workers also extend to undocumented workers. Please note that vocational rehabilitation benefits can include language acquisition classes, GED courses, “job placement” benefits, etc.
2. The Independent Contractor Argument:
In our experience, virtually every employer argues the injured undocumented worker is an independent contractor and therefore not entitled to workers’ compensation benefits. These arguments are almost always without merit. In Montana, a worker must obtain a valid independent contractor exemption certificate (ICEC) before they can operate as an independent contractor.[xvii] To obtain an ICEC, the individual must be legally working in Montana. Therefore, it is almost certain that no undocumented worker has a valid ICEC.
3. “Statutory Employer” claims pursuant to Mont. Code Ann. § 39-71-405:
Employers who hire undocumented workers may be less likely to comply with workers’ compensation insurance requirements and may lack sufficient assets to pursue as uninsured employers. In such cases, and depending on the employment situation of the worker, attorneys should consider Mont. Code Ann. § 39-71-405, which attributes coverage and liability to a general contractor if the worker’s direct employer is a subcontractor who fails to provide proper coverage.
In relevant part, § 39-71-405 reads:
Liability of employer who contracts work out.
(1) An employer who contracts with an independent contractor to have work performed of a kind which is a regular or a recurrent part of the work of the trade, business, occupation, or profession of such employer is liable for the payment of benefits under this chapter to the employees of the contractor if the contractor has not properly complied with the coverage requirements of the Worker’s Compensation Act …
(2) Where an employer contracts to have any work to be done by a contractor other than an independent contractor, and the work so contracted to be done is a part or process in the trade or business of the employer, then the employer is liable to pay all benefits under this chapter to the same extent as if the work were done without the intervention of the contractor, and the work so contracted to be done shall not be construed to be casual employment. Where an employer contracts work to be done as specified in this subsection, the contractor and the contractor’s employees shall come under that plan of compensation adopted by the employer.
4. Language Barriers:
Some undocumented workers may not be able to read or speak English. Because of this, attorney-client communication may prove difficult. There are local and online translation services with dial-in options that allow immediate conversations. These companies also allow scheduled conference calls as well as in-person interpreters for depositions, etc. For example, in Montana, Montana Language Services is a great resource.[xviii]
Please note that insurers should cover the cost of translation services for all medical appointments pursuant to Mont. Code Ann. § 39-71-704, as understanding and informed consent are essential components of “reasonable” medical treatment.
5. Fear of Repercussion including Deportation:
While undocumented workers are likely entitled to the full range of workers’ compensation benefits in Montana, they may fear repercussions from filing a claim. These concerns may include possible deportation or difficulties finding future employment. Attorneys should be prepared to address these fears and provide appropriate guidance and resources to their clients.
If necessary, practitioners may refer insurers and/or opposing counsel to case law regarding inappropriate retaliation. For instance, in Arias v. Raimondo,[xix] an undocumented worker brought an action against the employer’s attorney, alleging retaliation under the Fair Labor Standards Act (FLSA) arising from attorney’s plan to have employee taken into custody by U.S. Immigration and Customs Enforcement (ICE) to derail his state court claims against employer. The Arias Court ruled that the claims could proceed against the employer and the employer’s attorney in his personal capacity.
Conclusion
In summary, workers’ compensation attorneys in Montana should not be dissuaded from representing undocumented workers, particularly given Montana’s existing statutory authority providing coverage to these workers.
[i] Mont. Hist. Soc’y, Coming to Montana: Immigrants from Around the World—Historical Narrative for Educators (rev. ed. 2024)
[ii] Building the Railroads, Immigrant Montana, http://exhibits.lib.umt.edu/omeka/exhibits/show/immigrant-montana/railroad-intro/building-the-railroads (last visited Jan. 15, 2025)
[iii] Mont. Hist. Soc’y, Coming to Montana: Immigrants from Around the World—Historical Narrative for Educators (rev. ed. 2024)
[iv] Brian Shovers, Remaking the Wide-Open Town: Butte at the End of the Twentieth Century, 48 Mont.: Mag. W. Hist. 40 (1998)
[v] Non-exhaustive list: Colorado (Colo. Rev. Stat. § 8-40-202(b)), California (Cal. Lab. Code § 3351), Florida (Fla. Stat. § 440.02(15)(a)), Kentucky (Ky. Rev. Stat. Ann. § 342.640-1), Nevada (Nev. Rev. Stat. Ann. § 616A.105), New Mexico (N.M. Stat. Ann. § 52-3-3), North Carolina (N.C. Gen. Stat. § 97-2-2), South Carolina (S.C. Code Ann. § 42-1-130), Tennessee (Tenn. Code Ann. § 50-6-102(10)(A)), Texas (Tex. Lab. Code Ann. §§ 401.011, 406.092), and Utah (Utah Code Ann. § 34A-2-104(1)(b)
[vi] WY Stat § 27-14-102
[vii] Erick Garcia Luna, How Has Immigrant Employment Changed Since the Pandemic?, Fed. Rsrv. Bank of Minneapolis (Jan. 15, 2024) (https://www.minneapolisfed.org/article/2024/how-has-immigrant-employment-changed-since-the-pandemic)
[viii] [list fastest
[ix] 8 U.S.C. §§ 1324a(a)(1)-(2); 1324a(e)(4)-(5), (f)(1)[x]See, e.g., Farmer Brothers Coffee v. Workers’ Comp. Appeals Bd., 133 Cal.App.4th 533, 542 (Cal. Ct. App. 2005).; Econ. Packing Co. v. Ill. Workers’ Comp. Comm’n, 901 N.E.2d 915, 921-23 (Ill. App. Ct. 2008); Rodriguez v. Integrity Contracting, 38 So. 3d 511, 519 (La. Ct. App. 2010).
[xi] Econ. Packing, 901 N.E.2d at 921-23
[xii] See Vaughan Roofing & Sheet Metal, LLC v. Rodriguez, 562 U.S. 1256 (2011)
[xiii] Sanchez v. Eagle Alloy, 254 Mich. App. 651 (Mich. Ct. App. 2003)
[xiv] Ortiz v. Cement Prod., Inc., 708 N.W.2d 610 (Neb. 2005)
[xv] Tarango v. State Industrial Ins. Sys., 25 P.3d 175 (Nev. 2001)
[xvi] See, respectively, Mont. Code Ann. §§ 39-71-701 through 703 and Mont. Code Ann. § 39-71-1006)
[xvii] See, Mont. Code Ann. § 39-71-401(2)(x)
[xviii] 1 (406) 920-0068; https://www.mtlanguageservices.com/.
[xix] 860 F.3d 1185, United States Court of Appeals, 9th Circuit, (March 14, 2017)
