California law requires all employers to carry workers' compensation insurance except for the cases of sole ownership of business (no employees). Even if an employer has one employee, they must carry this type of insurance. The only exception, according to the State of California Department of Industrial Relations, is roofers. Even if a roofer has no employees, they must still possess workers' compensation insurance. If all employers are generally requires to provide workers' comp insurance, who are they required to provide it to? This is often the question when it comes to contracted workers.
Independent contractors, by definition, provide goods or services to other businesses, corporations, etc. These individuals provide services agreed upon in a contract. The employer then is not necessarily hiring this person as an employee, but rather entering into a contract with them. Another common classification for contracted or independent contract workers is that of a "freelance" worker. Because there is no employer/employee relationship established between the two, any question about the relationship between the contractor and worker must be found in the contract.
It is actually fairly simple to misclassify an employee as an independent contractor and vice versa. Unfortunately, in many instances this is not simply a mistake. Since it serves as a tax benefit to have fewer employees, employers may purposefully classify their employees and independent contractors in order to avoid paying taxes and providing additional benefits. The entire point of workers' compensation insurance is a mutual benefit for employer and employee. By filing this type of claim, a worker is provided the benefits they need to cover lost wages, medical expenses etc. while it benefits the employer in that their employee can no longer file a lawsuit against them for the incident.
California Labor Code § 2750.5 states that "For the purposes of workers' compensation law, this presumption is a supplement to the existing statutory definitions of employee and independent contractor, and is not intended to lessen the coverage of employees under Division 4 and Division 5." If you are wondering about workers' compensation as it pertains to your contracted work, then consider the variables listed by the California Department of Industrial Relations:
These are just some of the factors to consider when evaluating your true status as either an employee or an independent contractor. It is of the utmost importance to understand that employers do not have to cover independent contractors under workers' compensation insurance. However, due to the high potential for lawsuits coming from independent contractors, many employers may agree to provide workers' compensation in order to avoid these lawsuits in the event of an injury.
If you still have questions about your coverage status and whether or not you are being accurately labeled as an independent contractor, please do not hesitate to contact our firm. The Law Offices of Gerald L. Marcus has many skilled injury attorneys on staff that are familiar with workers' comp issues such as this. If you were injured on the job, you can rest assured that our firm will fight for your compensation, whether that compensation is coming by way of a workers' comp insurance claim or a lawsuit against your employer. To learn more, call us today!