The Witness Box

Commenting on expert evidence, economic damages, and interesting developments in injury, wrongful death, business torts, discrimination, and wage and hour lawsuits

Sunday, August 19, 2007

Calculating lost earnings for undocumented Mexican workers

How do you do it?

Clearly undocumented workers are entitled economic damages when they become injured or killed while working in the U.S. No court or attorney denies this. The question is on which country's wages (home or U.S.) should the damages be calculated on. Generally this is a legal question, with an answer that is not clear to many.

Well in any event, here are some data sources for finding information on Mexican wages.

http://www.inegi.gob.mx/

The data stored at The National Institute of Statistic, Geography and Informática (INEGI) is very useful and covers information regarding wages and employment by occupation and industry. INEGI's basic objective is to coordinate the National Systems Statistical and of Geographic Information and to offer the public service of statistical and geographic information on the territory, the population and the economy of Mexico

http://www.inegi.gob.mx/est/contenidos/espanol/rutinas/ept.asp?t=man08&c=481

Has the average hourly wage for Mexican workers. It is about $2.60 an hour.

clickk here

Has information on the minimum wage in Mexico. The min. wage varies by region in Mexico tends to be around 0.60 an hour. The min. wage is useful for determining the value of some types of household services.

Some background on calculating economic damages in cases involving undocumented workers>>>> ( See : "How Long do Mexican Migrants Work in the U.S.?" (November 28, 2006). Available at SSRN: http://ssrn.com/abstract=949632 , for more information on how to calculate economic damages in cases involving undocumented Mexican workers.)

Undocumented Mexican workers have been and continue to be parties in a number of different types of legal cases such as those involving products liability, medical malpractice, labor disputes involving allegations of FLSA violations and employment discrimination. In some instances, the plaintiffs and/or their families have been awarded some relatively sizable economic damages for both past and future pay losses. In both the initial court proceedings and the appeals associated with a number of these cases, two main types of questions arise in the calculation of economic damages of undocumented Mexican migrant workers.

The first question involves the legality of awarding back pay or past damages to undocumented workers. It is frequently argued that the landmark U.S. Supreme Court ruling in Hoffman Plastics Compounds[1], voids undocumented workers claims to past or back pay losses. In the Hoffman case, the National Labor Relation Board (NLRB) found that four undocumented workers were wrongfully terminated because they engaged in union related activities and the NLRB subsequently awarded back pay to all the workers. In this case, the Board awarded back pay to one of the workers, Mr. Jose Castro from the date of his termination to the date that Hoffman Plastic Compounds first learned of his immigration status.

The Court’s majority found that the Immigration Reform and Control Act (1986) limited the Board’s ability to award back pay to undocumented workers because awarding “back pay to illegal aliens would unduly trench upon explicit statutory prohibitions critical to federal immigration policy, as expressed in IRCA”.

According to some legal observers, this Court ruling has had a significant chilling effect on cases, such as FLSA violation and employment cases, where a significant amount of the potential economic loss allegations involves lost back pay. Prior to Hoffman the EEOC explicitly included the protection of the rights of undocumented workers as one of their stated missions and offered guidance on the appropriateness of back pay to undocumented workers.

The EEOC stated that “…unauthorized workers who are subjected to unlawful employment discrimination are entitled to the same relief as other victims of discrimination…”[2] Accordingly there were some notable cases brought on behalf of undocumented workers such as the Title VII class suit EEOC v. Phase 2 Co.[3]

According to the suit, 10 Mexican workers, all of whom had an unknown immigration status, and a class of similarly situated individuals were called derogatory names and subjected to discriminatory working conditions on a daily basis. In the settlement of the case, the defendant agreed to pay a total of $750,000: $600,000 to the 10 charging parties and $150,000 to other workers perceived to be of Mexican national origin that worked on projects for the defendant and experienced national origin harassment or retaliation. After the Hoffman ruling the EEOC rescinded the agencies previous guidance concerning the appropriateness of back pay to undocumented workers.[4]

In other cases that concern the award of back pay to undocumented workers it has been argued, successfully in some instances, that Hoffman is not appropriate and therefore back pay should be awarded. For instance, in the New York state court case, Celi v. 42nd Street Development Project, Inc[5], it was argued Hoffman did not apply to a state court action and in addition the facts in the case were distinguishable from the Hoffman case. In this case, the Plaintiff fell through an opening in the basement floor while performing demolition work and filed a suit against the building’s owner and Management Company alleging negligence and violations of labor law.

The plaintiff was seeking approximately $26,000 in past lost earning and $900,000 in future lost earnings. In this particular case the state court judge agreed with the argument that Hoffman was not applicable to the state court action and allowed both back and front pay to be awarded to the injured undocumented worker.

The second question revolves around the base earnings by which to calculate the value of the undocumented workers alleged future lost earnings. In particular, across the country the case law is not completely clear on whether future earnings loss should be based on the wages that the undocumented worker could have earned in the U.S. or in the wages that they could have earned in their home country.

In some cases, courts have ruled that under certain conditions, such as when the deportation of the undocumented worker is imminent, economic damages should be based on the wages that the illegal worker would have been earned in their home country and not those that would have been earned in the U.S.

For instance, in tort claims California Rodriguez v. Kline (1986)[6] requires a hearing on the plaintiff’s immigration status in lost wage damage claims of illegal aliens. In this hearing if the plaintiff can not show that they have taken steps to correct their immigration status then Rodriguez requires that the plaintiff’s future earnings should be based on the wages that could have been earned in his or hers native country. For a more detailed discussion of the legal environment concerning the economic damages of illegal immigrants across the country see Bowles (2004).

In other instances, courts have ruled economic damages should be based on the wages the worker would have been able to earn in the U.S. in situations where the workers deportation was not imminent or where the employer knew that the worker was in the country illegally. For instance in a New Hampshire state court case, Mr. Wudson Rosa claimed he was injured while working at a Wal-Mart construction site when an aerial lift tipped over and fell on him.[7] Mr. Rosa sued the project's general contractor and two of its subcontractors.

In this case, The New Hampshire Supreme Court ultimately ruled that in general the lost earnings should be limited to the wages that could have been earned in the home country but there are some circumstances in which an illegal alien’s lost earning capacity can be measured by what he could have earned in the United States. These circumstances include instances where an “illegal alien can prove that his employer was aware or should have been aware of his illegal status but hired him -- or continued to employ him – nonetheless”.

In Texas, recent case law suggest that undocumented workers can pursue lost wage claims in state court since “…Texas law does not require citizenship or possession of immigration work authorization permits as a prerequisite to recovering damages for lost earnings capacity.”[8]
So in sum, courts have generally ruled that undocumented workers are entitled to sue for lost wages in U.S. courts but have been split on the legality of back pay and the base for front pay and future damage awards.

To date, while some courts have ruled that the wages of the home country are relevant to the calculations of future damages, the courts are generally silent on this issue. Consequently, the estimation of the U.S. work life expectancy is crucial in lawsuits involving the injury or death of undocumented workers.

[1] Hoffman Plastic v. NLRB, 535 US 137
[2] See EEOC Notice No. 915.002, Enforcement Guidance on Remedies Available to Undocumented Workers Under Federal Employment Discrimination Laws.
[3] EEOC v. Phase 2 Co., Civil Action No. 03-N-1911 (D. Colo. 2003)
[4] See EEOC Directives Transmittal - Notice of Rescission of No. 915.002, Enforcement Guidance on Remedies Available to Undocumented Workers Under Federal Employment Discrimination Laws, June 27, 2007.
[5] Celi v. 42nd Street Development Project, Inc. 5 Misc. 3d 1023 (A) (N.Y. Sup. Ct. 2004)
[6] Rodriguez v. Kline, 186 Cal. App. 3d 1145 (CA 1986)
[7] Rosa v. Partners in Progress, 868 A 2d 994 (NH, 2005)
[8] Tyson Foods, Inc. v. Guzman, 116 S.W. 3d 233 (TX, 2003)

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