Since so many people get hurt on the job due to accidents, companies are required to purchase workers’ compensation insurance for their employees. This means that if you’re injured in the course of your normal work duties, you’re typically entitled to benefit payments to help you make ends meet while you recover.
The amount and length of the payments depend on various factors, including the severity of the injury. In some cases, injured workers can collect benefits for life or settle for a lump sum payout.
Unfortunately, independent contractors are not covered by workers’ compensation. This can be frustrating for some considering that more companies are hiring contract workers instead of full-time employees.
Amid the rise in labor contracting, some companies are performing hiring gymnastics. They bring you in as a contractor but assign you duties as a regular employee. This is called worker misclassification.
Some companies misclassify their workers as independent contractors in an attempt to cut costs. For instance, they may do this to bypass minimum wage requirements or avoid paying workers’ compensation premiums and payroll taxes.
However, just because you’re labeled a contractor in your hiring papers doesn’t necessarily mean you truly are one under the law. If a company misclassified your employment status, you may still be eligible for workers’ compensation.
What’s the Difference Between an Independent Contractor and a Regular Employee?
Those working in transport, construction, home healthcare, restaurant, and tech industries are among the most often misclassified workers.
Passing off workers as contractors rather than regular employees may help a company avoid some labor-related costs. There are several considerations when determining whether a worker is an independent contractor or a regular employee.
One of the things the judge considers is the degree of control the company maintains over you. The more they direct and supervise your work, the more likely you are to be considered an employee, and thus eligible for workers’ compensation.
Here are some of the tests for determining whether or not a worker is an independent contractor:
- Who Directs Your Work?
Independent contractors normally work without the direction and control of the hiring company and have the discretion to turn down jobs. In contrast, regular employees cannot decline duties or work whenever they want.
Therefore, if the company has power over you to set a work schedule and you cannot decline work, you might be considered an employee for workers’ comp.
- Who Provides the Equipment?
Contractors often use their own tools and materials and can hire subcontractors to help with a project. If the company requires you to use specific equipment and controls the work process, you might be an employee.
- How Do You Get Paid?
Contractors are normally paid by the project and submit invoices. This means that if you’re earning a regular pay, such as an hourly wage or salary, you might be considered an employee.
- Do You Work for Other Companies?
Contractors often have multiple clients and may handle projects for different customers at the same time. If you’re working long-term for only one company, you might be an employee.
If you’re genuinely an independent contractor, you won’t be eligible for workers’ comp benefits. Instead, you should consider purchasing your own insurance for work-related injuries
What Does Workers’ Compensation for Contractors Include?
If the judge finds that you have been designated as an independent contractor but are treated like a full-time employee, you could qualify for workers’ comp benefits, which may include:
- Medical Benefits
This covers expenses related to your healthcare. These include doctor visits, hospital stays, prescription drugs, and medical travel expenses. Medical benefits under workers’ comp can continue as long as necessary, even for life.
- Wage Loss Benefits
If you can’t work due to your injury, you can receive about 66% of your average weekly wage. In certain cases, especially for low-wage workers, the wage replacement can go up to 90%.
While payments only begin after you have missed work for at least seven days, the benefits are retroactive. This means that once the payments start, you’ll be compensated for those initial days.
- Specific Loss Benefits
If you lose a specific body function or part, like hearing, vision, or leg, you may be compensated for it. This type of benefits payment is usually made in a lump sum.
- Death Benefits
If a worker dies from a work-related injury, their family may receive benefits to cover funeral expenses and lost income to ease their financial burden.
To qualify for workers’ compensation, you must report the injury to your boss, provide medical proof of injury and treatment, and file a claim with your employer or their insurance company. It’s advisable to report any injury, no matter how small it seems. You never know the problems you could develop later as a result of the injury.
When it comes to reporting a work-related injury, the waiting period is usually short, and missing the deadline can deny you the benefits. Therefore, be sure to report your injury as soon as possible.
Some workers are reluctant to report their injuries for fear of losing their jobs. The company isn’t allowed to fire you simply for filing a workers’ compensation claim. They can face legal action if they dismiss you unfairly. In most cases, you should also continue to collect the benefits even if your job has been terminated.
What to Do if You’re Denied Workers’ Compensation
Companies have good reasons to hire contract workers, and many people love the freedom of working how and when they want. However, contract work excludes you from many employment benefits. Therefore, being misclassified as a contractor can put you at a high risk of financial hardship if you get injured at work.
If you have been hurt at work and denied workers’ comp because you’re designated a contractor, speak to an experienced workers’ comp attorney as soon as possible. An attorney can help you determine if you have been misclassified, guide you through the claim process, and represent you at hearings if necessary.
Even if you don’t qualify for workers’ compensation, you may still be able to file a personal injury claim against the company or a third-party responsible for your injury.
