WILSON, J.
In this appeal, the employee presents an issue of first impression: whether an illegal alien, who has misrepresented that status in order to be hired, is barred from receiving compensation benefits when he then suffers a work-related injury. An administrative judge answered the question in the affirmative and dismissed the claim of this employee, a Mexican national who had presented an invalid green card in order to be hired by the employer. We conclude that being an illegal alien is not an absolute bar to status as an employee under the Act, and that the employee's misrepresentation in inducing the contract of employment does not invalidate that contract ab initio. As such, the employee is entitled to workers' compensation benefits for his work-related injury. We reverse the judge's dismissal of the case on that basis, and recommit the case for further proceedings on the extent of incapacity.
At hearing, the parties stipulated to the following facts material to the issue on appeal:
1. When Feliciano Brambila was hired by Chase Walton Elastomers, on or about September 11, 1991, he submitted as proof of his eligibility of employment an Alien Identification Card bearing the number "A97856742."
2. This Alien Identification Card was not valid.
3. At the time of his hire by Chase Walton Elastomers, on or about September 11, 1991, Feliciano Brambila was a Mexican national without legal right to work in the United States of America.
4. At the time of his industrial accident, on or about December 18, 1992, Feliciano Brambila was a Mexican national without legal right to work in the United States. (July 11, 1996 "Response and Answer to Insurer's Motion to Dismiss Claim" 1-2.)
We will refer to this document as the judge's July 11, 1996 Findings and Order.
Based on this stipulation of facts, the insurer argued that the employee's claim for workers' compensation benefits must be dismissed. The factual basis for the underlying claim for benefits is not germane to the issue of Mr. Brambila's status as an illegal alien and its effect on his status as an employee under the Act. We do note, however, the following facts found in the judge's July 12, 1996 decision on the merits: The December 18, 1992 industrial injury, a contusion to Mr. Brambila's right hand resulting from a slip and fall, was accepted by the insurer. Mr. Brambila returned to work three days later in a light duty capacity, and worked until he was terminated for non-medical reasons in June 1994. The employer obeyed the statutory requirements for production of a Social Security Card and an Alien Registration Card at the time of Mr. Brambila's hire. The employer did not discover that Mr. Brambila's immigration status was illegal, and had been illegal throughout his period of employment, until January 1996. (July 12, 1996 Dec. 2, 3, 5, 7.)
In deciding that Mr. Brambila's claim should be dismissed due to his status as an unauthorized or illegal alien, the judge adopted each of the insurer's theories as to why compensation benefits should be barred in this case:
1. There was no employer-employee contract for hire between Chase Walton Elastomers and Mr. Brambila, as the contract was void
ab initio, due to Mr. Brambila's fraudulent misrepresentation of his immigration status inducing the employer to hire him. Since Mr. Brambila was not an employee, he was not within the Act, which under § 1(4) covers only employees under a contract of hire with an employer. (July 11, 1996 Findings and Order 2-3.) An alternative argument pressed by the insurer is that Mr. Brambila's illegal status made the employment contract an agreement for the performance of an illegal act.
2. General Laws c. 152 does not specifically provide for coverage of illegal aliens. (July 11, 1996 Findings and Order 5-6.)
3. In the event Mr. Brambila were found to be an employee, the employer would be deprived of specific defenses to his claim, such as a light duty job offer and labor market surveys, because he has no legal right to work in the United States. (July 11, 1996 Findings and Order 6-7.)
4. Any order of payment for wage-replacement benefits would effectively be an order for the insurer to violate the federal immigration law,
8 U.S.C.A. § 1324a(a), which, at all times relevant to this proceeding, prohibited employers from knowingly hiring and employing illegal aliens. (July 11, 1996 Findings and Order 7-8.)
The employee contends on appeal that the decision should be reversed as being contrary to law — that there is no prohibition within the Act to an illegal alien being classified as an employee, regardless of the manner in which he procured his job. The insurer counters that the decision should be affirmed for substantially the same reasons argued to and adopted by the judge:
1. Because the employment agreement between Mr. Brambila and Chase-Walton was predicated on Mr. Brambila's fraudulent misrepresentation of his immigration status, it is not a valid contract of hire.
2. Because the employment of Mr. Brambila in the United States is in contravention of federal immigration and state employment laws, any employment contract between Chase-Walton and him is void.
3. Because the employment of Mr. Brambila in the United States violates public policy against the employment of illegal aliens, any employment contract between Chase-Walton and him is void.
4. Since the Act does not specify that illegal aliens are covered by its provisions, Mr. Brambila's claim for benefits thereunder must fail.
5. The insurer is unduly prejudiced in its defense of this claim, because Mr. Brambila's inability to work legally preludes the insurer from making a good faith job offer or presenting labor market surveys in support of its earning capacity contentions.
Although at first blush the insurer's assertions hold some appeal, after closer scrutiny we disagree with each of them. We conclude that Mr. Brambila was working as an employee for Chase-Walton under a valid contract of employment at the time of his industrial accident and, therefore, his injury was compensable.
Workers' compensation coverage extends to "employees," defined under the Act as "every person in the service of another under any contract of hire, express or implied, oral or written. . . ." G.L.c. 152, § 1(4). While it is undisputed that Mr. Brambila was indeed working in the service of the employer when he was injured, the judge determined that the contract of hire was void ab initio — entirely invalid due to the misrepresentations with which the employee induced its execution. (July 11, 1996 Findings and Order 2.)
The common law in Massachusetts does not support the proposition that a contract induced by misrepresentation is void ab initio. "A contract induced by fraudulent misrepresentations is voidable, not void. [Citations omitted.] The rule applies in the employment context as well." Shaw's Supermarkets Inc. v. Delgiacco, 410 Mass. 840, 842 (1991). "[U]nless rescinded, `a voidable contract imposes on the parties the same obligations as if it were not voidable.'" Berenson v. French, 262 Mass. 247, 260-261 (1928), quoting Williston, Contracts, § 15. "`Voidable' imports a valid act which may be avoided, rather than an invalid act which may be confirmed. . . ." Rothberg v. Schmiedeskamp, 334 Mass. 172, 176 (1956). As of the occurrence of the industrial accident, the employer had not rescinded the contract of hire. The rights incident to Mr. Brambila's status under the contract of hire were intact. Hence, that unrescinded contract was still enforceable at the time of the injury. One of the rights incident to the employment status was coverage under the Act. See Pierce's Case, 267 Mass. 208, 211-212 (1929) (illegal employment contract of minor at fireworks factory not void ab initio and still enforceable as of death of minor occurring at work; death therefore compensable); Garnhum's Case, 348 Mass. 87, 89-90 (1964) (minor's misrepresentation of his age to obtain job was no bar to recovery for work-related injury under the Act). On this basis, we disagree with the judge's conclusion and the insurer's assertion that no contract of employment ever existed between the employee and the employer in this case.
The employee asserts that the judge's reasoning as to his "fraudulent misrepresentation" is flawed in an even more fundamental respect. While acknowledging the misrepresentation, Mr. Brambila asks, "Where was the fraud?" We note the common law elements of fraud: "[A] false statement of a material fact made to induce the [employer] to act, together with reliance on the false statement . . . to the [employer's] detriment." Zimmerman v. Kent, 31 Mass. App. Ct. 72, 77 (1991). While it is easy to see the false statement of a material fact relied on by the employer — that Mr. Brambila was authorized to work in the United States — we are not persuaded that the employer suffered any detriment thereby. Mr. Brambila performed work for over two years, and the employer paid him. The employer was insured for the work injury, which could have happened to anyone, legal status or not, by its workers' compensation insurance. It would appear that there was no detriment caused by the misrepresentation as to immigration status; the employer was in the same position as it would have been if Mr. Brambila had possessed a valid green card.
Shaw's Supermarkets, supra, is instructive as to when an employee's misrepresentation in obtaining employment can legitimately bar coverage under the Act. In that case, the court applied the Larson "common sense rule":
In order for such a misrepresentation to bar benefits, the following factors must be found: "(1) The employee must have knowingly and wilfully made a false representation as to his physical condition. (2) The employer must have relied upon the false representation and this reliance must have been a substantial factor in the hiring. (3) There must have been a causal connection between the false representation and the injury." 1C A. Larson, Workmen's Compensation Law § 47.53 (1986).
Shaw's Supermarkets, supra at 843. The court applied this test and held that § 27 bars compensation when the elements are met, stating, "[W]e believe that the Legislature intended to preclude workers' compensation in cases in which an employee's deliberate misrepresentation
leads to injury." Id. at 845 (emphasis added). See also § 27A. There is no evidence before us that Mr. Brambila's misrepresentation caused his injury. (July 11, 1996 Findings and Order.) The injury "might have happened in the same way whatever the [employee's status] had been. His bodily presence was an essential condition of his injury; but it does not follow that it must have been a cause thereof."
Moran v. Dickenson, 204 Mass. 559, 562 (1910).
The insurer argues that the subject contract of hire was void, as well, because it constituted a contract for the performance of an illegal act: the employment of an alien which the employer knows to be unauthorized to hold such employment. See 8 U.S.C.A. § 1324a (a); G.L.c. 149, § 19C. The facts of this case simply do not describe such an illegal act. Here the employer was diligent in requiring that Mr. Brambila provide the necessary documentation regarding his authorization to work. The employer did not hire Mr. Brambila with knowledge that he was an illegal worker. By the time the employer discovered that Mr. Brambila was not authorized to work, his employment already had been terminated. There was no illegality regarding the employer's employment of Mr. Brambila so long as this employer was unaware of his unauthorized status. Sure-Tan, Inc. v. N.L.R.B., 467 U.S. 883, 893, 104 S.Ct. 2803, 2809 (1984); Del Rey Tortilleria v. N.L.R.B., 976 F.2d 1115, 1124 (7th Cir. 1992) (Cudahy, J., dissenting). There is no evidence of an "illegal contract" in this case.
Likewise, there is no valid public policy argument that, by providing workers' compensation benefits to illegal aliens, our construction of c. 152 would run afoul of the federal mandate to discourage unauthorized immigration. Again, the federal law in effect at the time of this industrial injury made it illegal only for employers to knowingly hire unauthorized aliens. Without the component of the employer's knowledge, the only policy consideration left to discuss is whether the lack of availability of workers' compensation benefits would be a deterrent to unauthorized immigration. We think that such a hypothesis is largely conjectural, and certainly does not meet the countervailing equitable consideration: We are dealing here with an injured worker who happened to be an illegal alien. The presence of this unauthorized worker at the workplace was reported to the insurer; premiums were paid, and coverage was afforded. Did Mr. Brambila's unauthorized status cause his injury? Of course not. See Moran v. Dickenson, supra. Are any reasonable expectations of the employer or insurer thwarted by our construction? We think not. To the contrary, what would be the rationale for a windfall to the insurer for receiving premiums on an employee whom it then does not have to cover; or for the employer to receive the services of an employee, whose undisputed industrial injury does not then have to be assessed against its experience modification rating? In our view, the policy arguments more persuasively favor Mr. Brambila.
The judge interprets the legislative omission of expressly including illegal aliens within coverage of the Act, as do a number of other states' workers' compensation laws, as meaning that the legislature intended to leave them out. We are not so persuaded. The insurer's analysis skirts two important words in the § 1(4) definition of employee: "every person." If the legislature intended to exclude a category of persons called "illegal aliens" from the scope of the phrase, "every person," we cannot presume to know that. Certainly, the legislature knows well how to exclude persons from coverage under the Act. See, e.g., § 8(2)(j) (forfeiture of any right to compensation during any period of incarceration pursuant to a conviction for felony or misdemeanor).
As a final matter, the judge concluded that, since the employee's illegal status bars him from working, the insurer is left with no way to prove that he has an earning capacity. We acknowledge that the employer could not now offer a light duty job to the employee without being in violation of federal law, given its knowledge of the employee's illegal status. See 8 U.S.C.A. § 1324a(a). We also realize that, in the event the insurer proffers expert vocational labor market testimony, the jobs put forward as suitable in such testimony could not actually be held by the employee for the same reason. Nonetheless, this does not mean that the insurer is foreclosed from presenting a case on earning capacity. Many present incapacity assessments are performed without either admission of expert vocational evidence or actual job offers. Such assessments are, of course, based on the medical evidence adopted by the judge, together with the consideration of the employee's age, education, experience and training. See Frennier's Case, 318 Mass. 635, 639 (1945). An earning capacity arrived at by that general approach is an estimate, which the judge applies using his or her own practical knowledge. See Mulcahy's Case, 26 Mass. App. Ct. 1 (1988). We see no impediment to this method of earning capacity calculation due to the employee's illegal status. Furthermore, there is no reason why the insurer could not put forward hypothetical job offers or expert vocational testimony that used labor market information for the purposes of showing the employee's ability to earn wages apart from his alien status, jobs availability and wage ranges. After all, the vocational issue before the administrative judge is the effect of the work injury on earning capacity, rather than the effect of the employee's alien status on work capacity.
Accordingly, we conclude that the employee's misrepresentation of his immigration status and the fact that he was not authorized to work in the United States, along with all other related matters argued by the insurer, do not bar him from receiving workers' compensation benefits otherwise due. We reverse the judge's dismissal of the case, and recommit the case for further proceedings on the extent of incapacity.
The administrative judge no longer serves in the department. We transfer the case to the senior judge for reassignment and a hearing de novo on the issue of employee's present incapacity.
So ordered.
______________________________ Sara Holmes Wilson Administrative Law Judge
______________________________ Carolynn N. Fischel Administrative Law Judge
______________________________ Frederick E. Levine Administrative Law Judge
Filed: August 22, 1997