I have two different roleplay characters that I'm looking into creating a fic about that are in that situation. They are Descendents (term coined by Baron) - that is, their parents were Yeerks trapped as humans.
In my version of events the "grubs", or children of former Yeerks, are watched over carefully. They are registered in the government databases and sent to separate schools. The early years after the invasion there was a lot of segregation. The children were kept at boarding schools and fed anti-Yeerk propaganda to prevent an uprising.
Then, after a generation or so there was an civil movement for equal rights. Things got better, but still not great. Reyna, one of my characters, is a fourth generation Descendent and she lives in a world where they are supposedly "equal", but still face prejudice and derision and have their status clearly labeled on all official documents. Most hospitals will not take their insurance and many jobs will not hire them.