Is your workers' comp carrier also verifying your employees' eligibility to work?

Some insurance companies may be denying payment of benefits on the basis that unauthorized workers should not have been employed in the first place and thus are not eligible to be returned to work (or receive payments for the difference in wages for light duty work versus the employee's regular position). How does the company know that the worker is unauthorized? Well, some may be running the Social Security Numbers of your employees through either E-Verify or the Social Security Number Verification Service. [An aside:  neither program authorizes its use for that purpose, and the SSNVS handbook specifically prohibits third parties, i.e., someone other than the employer, from using it to take action that might be deemed adverse to the employee.]

This can create several issues for employers. First, an employer could have some liability to the employee if the employer knows that the SSN is being used for an improper purpose. Second, if the carrier makes the employer aware that the SSN was returned as mismatched or that the carrier has reason to believe the employee is not authorized to work, the employer must determine what steps it wishes to take to further verify employment eligibility. If it doesn't take any steps, it runs the risk of being considered "on notice" that a potentially unauthorized worker is in its employ.

Employers should consider periodically informing the carriers that any information provided is to be used for its authorized and intended purpose only. Taking it a step further, employers could also provide a statement to the carrier that the SSN is not to be used for any unauthorized purpose, including specifically any attempts to determine the work eligibility status of the employee.

In the FYI category--Tennessee's workers' compensation statutes provide that unauthorized workers are still eligible to receive certain benefits. The law places a limit on the amount of those benefits that can be awarded versus what would be available to an authorized employee. [See T.C.A. 50-6-241(e)(1)]

You thought an arm and a leg were expensive? You were right!

From our very own Michael L. Forrester:

Employers are occasionally faced with the issue in workers’ compensation cases of what body part is affected in a work injury, and what difference it makes when it’s time to determine the amount of any permanent disability award. And the Employer and the injured Employee may be on opposite sides of the proverbial fence when confronting the extent of any medical impairment. A recent Tennessee Supreme Court Workers’ Compensation Panel decision emphasizes the point.

In Schering Plough v Plumley, the employee’s foot was run over by a forktruck at work, and after months of treatment, he was returned to his regular job without restrictions but he did have a permanent medical impairment as a result of the injury. The issue for the Court was, which body part sustained the disability? Remember, when an employee is able to return to work for the same employer, at the same or greater pay, Tennessee law may “cap” the employee’s permanent disability award. The law now provides that the “cap” applies not only to “whole body” injury cases, but also to arm and leg injury cases. The employee and his attorney in Plumley contended that his injury should be confined to his foot because the employee’s permanent disability award could not be capped by the Court. Not surprisingly, the employer contended the injury affected the range of motion in the ankle and thus should be capped as a leg claim.


The Court determined that since the injury affected the ankle, and the employee had consistent pain in his lower leg and he sometimes limped from the injury, the injury went beyond the foot and the permanent disability award should be to the leg; thus the employee’s permanent disability award was “capped” since he had returned to his job. The Supreme Court has also determined that this same analysis applies in the event of a work-related hand injury.

So, we encourage employers to prompt the treating doctor to be specific in their medical assessments and their “body parts” analysis. It matters.