Workers’ Compensation for Independent Contractors
In the Carolinas, employers must purchase workers’ comp insurance as part of their business insurance that provides their employees with coverage for work-related injuries and illnesses. But does workers’ comp coverage also extend to independent contractors?
Employers typically do not have to provide workers’ compensation to independent contractors since contractors generally work as self-employed individuals or separate businesses. However, independent contractors still have options to seek financial recovery after getting hurt in the course of work.
After sustaining a work-related injury as an independent contractor, you may have the right to seek financial compensation for your medical costs, lost wages, and other losses through a workers’ compensation policy or personal injury claim. Contact Stewart Law Offices for a free initial case evaluation with a workers’ compensation benefits attorney to discuss your legal rights and options.
What Is an Independent Contractor?
An independent contractor refers to a worker who provides services to companies or clients without taking on the role of an employee. As a result, independent contractors qualify as self-employed individuals, which means they bear responsibility for payroll and income taxes, general liability insurance, and business expenses. Independent contractors usually work for a company or client under a written or oral contract. Independent contractors can control the means and methods by which they perform their work, so long as they provide the goods or services the client has contracted for.
State laws have legal tests to determine whether a worker qualifies as an employee or an independent contractor. Labor laws presume that workers qualify as employees, requiring the worker and employer to prove that the worker meets the test to qualify as an independent contractor. According to the North Carolina Department of Labor, the test for classifying a worker examines various factors, such as:
- Whether the worker has engaged in an independent business or occupation
- Whether the worker can independently use their skill, training, knowledge, and judgment to perform their work
- Whether the worker performs a specified piece of work at a fixed price, for a lump sum, or on an hourly fee basis
- Whether the employer cannot fire the worker for their method of work
- Whether the worker can hire and control assistants or other workers
- Whether the worker can select the time to work on the contracted job
- The permanence of the relationship between the worker and employer
South Carolina law uses a “right to control” test to determine whether a worker qualifies as an independent contractor or employee. This test examines whether an employer has the authority to direct the specific details of a worker’s performance, considering factors such as direct evidence of the right to exercise control, furnishing equipment or uniforms to the worker, the right to fire the worker, and the employer’s method of payment.
Are Independent Contractors Covered Under North or South Carolina Law?
Under North and South Carolina law, independent contractors cannot seek workers’ compensation from the companies or clients who hire them, even when they get hurt performing work for those clients. In other words, employers have no obligation to provide workers’ compensation coverage to independent contractors. However, independent contractors may receive workers’ compensation coverage through other avenues, or they can purchase their own workers’ compensation insurance.
Independent Contractor Misclassification
Unfortunately, many employers classify workers as independent contractors to reduce overhead, including payroll taxes and the premiums for purchasing workers comp insurance since independent contractors traditionally bear those costs. However, state and federal labor regulators have caught employers misclassifying workers as independent contractors when the circumstances of the parties’ relationship resemble a traditional employer-employee relationship, including:
- The worker solely depends on the employer for their income.
- The worker does not hold themselves out as an independent business or available to perform similar work for other clients.
- The employer controls the worker’s hours, work location, and the details of their work duties.
- The parties do not have a written or oral contract for the work.
- The parties have an undefined, open-ended scope of work.
- The worker receives compensation resembling hourly wages rather than contract fees.
If you suffered an injury on the job, an experienced lawyer from our law firm can help you seek medical care and discuss options to cover medical bills, lost income, and other damages you suffered due to the work injury.
When Independent Contractors May Be Covered Under the Law
Independent contractors may have the right to pursue a workers’ compensation claim under certain circumstances. First, although a client may have contracted you to do a project as an independent contractor, you may work through another company that employs you. That company is legally obligated to provide workers’ compensation since it has an employer-employee relationship with you.
In the Carolinas, an independent contractor may have the right to request workers’ compensation from a contractor or subcontractor whose negligence injures the worker on a construction site or other job site.
Finally, an independent contractor may request workers’ comp for a workplace injury from the company that hired them to perform work if the contractor can show that the company misclassified them as an independent contractor.
Other Legal Options for Pursuing Compensation After a Workplace Accident
After suffering an on-the-job injury as an independent contractor, you may have other avenues you might pursue for compensation or financial benefits after a work accident. For example, after injuries sustained due to a dangerous condition on a client’s property, you may have a premises liability claim against the client. You could file a claim against the client’s property insurance or errors and omissions insurance.
If you get hurt due to a design or manufacturing defect in tools or equipment you use for work, you can pursue a product liability claim against the manufacturer. You might also have personal injury claims against third parties whose negligence or recklessness injures you in the course of your work, such as a motorist who hits you while you travel for work. You could file a claim against their personal or commercial auto insurance policy. You can also turn to your health insurance to help cover medical bills stemming from a work injury.
Contact Stewart Law Offices for a Free Consultation to Discuss Your Situation
If you’ve been hurt on the job while working as an independent contractor, you need experienced legal counsel to evaluate your legal rights and options. At Stewart Law Offices, our results speak for themselves – we have secured multiple seven-figure-plus awards for accident victims across the Carolinas.* We return calls and messages promptly and can send a qualified attorney to meet you at home or in the hospital. Our firm charges no legal fee unless we obtain compensation for you.*
We can help you pursue compensation for your medical expenses, lost income, and other financial or personal losses. Contact us today for a free, no-obligation consultation with a lawyer to discuss workers’ compensation for independent contractors.