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Undocumented aliens who have no right to work in this country but are nonetheless injured on the job can sue for lost wages under New York Labor Law, a divided Court of Appeals held Tuesday in resolving a split between the two downstate appellate divisions. The majority found that New York laws entitling workers to lost wages are not in direct conflict with federal law, and are therefore not pre-empted. Two dissenters, however, argued for pre-emption, and also maintained that New York common law bars recovery. Balbuena v. IDR Realty LLC, 19, involved Gorgonio Balbuena, an undocumented alien from Mexico who was hired in September 1999 as a construction worker for Taman Management Corp. Majlinger v Cassino Construction Corp., 49, which was decided on submission, involved an undocumented Polish citizen who came to the United States on a travel visa, but stayed to work after the visa expired. In both cases, the workers were injured on the job and sought benefits under state law. Balbuena filed a personal injury suit against IDR Realty and Dora Wechler, owners of the Manhattan construction site. IRD and Wechler then brought a third-party action against Taman. Taman sought partial summary judgment, citing the U.S. Supreme Court ruling in Hoffman Plastic Compounds v. National Labor Relations Board, 535 US 137 (2002). That decision held that the Immigration Reform and Control Act of 1986 articulated a policy that would preclude undocumented immigrants from collecting back pay under the National Labor Relations Act. State Supreme Court denied the motion but the Appellate Division, 1st Department, modified, restricting Balbuena’s lost earnings claim “to the wages he would have been able to earn in his home country, since an award based on a prevailing foreign wage would not offend any federal policy.” A dissent, however, said IRCA was not meant to pre-empt New York Labor Law. More recently, the 2nd Department in Majlinger unanimously rejected the 1st Department’s interpretation of Hoffman as “unduly broad” and held that undocumented aliens can sue for lost wages. The Court of Appeals resolved the issue Tuesday in a 38-page, 5-2 decision. Judge Victoria A. Graffeo, writing for the majority, drew a sharp distinction between Hoffman and the cases decided Tuesday. “Whereas the undocumented alien in Hoffman criminally provided his employer with fraudulent papers purporting to be proper federal work documentation, there is no allegation in these cases that plaintiffs produced false work documents in violation of IRCA or were even asked by the employers to present the work authorization documents as required by IRCA,” she wrote. Further, Graffeo and the majority agreed that state labor law is consistent with federal law. “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,” Graffeo wrote. “This,” she added, “coupled with the fact that illegal aliens are willing to work in jobs that are more dangerous and undesirable — and for less money — than their legal immigrant and citizen counterparts, would actually increase employment levels of undocumented aliens, not decrease it as Congress sought by its passage of IRCA.” PAY FOR ILLEGAL WORK Also in the majority were Chief Judge Judith S. Kaye and Judges George Bundy Smith, Carmen Beauchamp Ciparick and Albert M. Rosenblatt. Judge Robert S. Smith dissented in an opinion joined by Judge Susan Phillips Read. “The Court holds today that New York courts may award damages to compensate a plaintiff for the loss of an opportunity to work illegally,” Judge Robert Smith wrote in dissent. He argued that such a recovery is barred “by the rule of New York law that the courts will not aid in achieving the purpose of an illegal transaction.” And even if New York law did permit recovery, federal immigration law would pre-empt it, Smith said. “Courts show insufficient respect for themselves and for the law when they help a party to benefit from illegal activity,” he wrote. Balbueno was argued by Michael T. Altman of Trolman, Glaser & Lichtman in Manhattan for Balbuena. Solicitor General Caitlin J. Halligan appeared as intervenor in defense of the Labor Law. Reed M. Podell of Smith & Laquercia in Manhattan represented Taman Realty. Francesca E. Connolly of Malapero & Prisco in Manhattan argued for IDR Realty and Wechler.

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