Many people who are injured at work are told by their employers that they are not employees but are independent contractors. This distinction is important because, under California law, employees are entitled to workers’ compensation benefits; independent contractors are not. Thus, if you are an independent contractor who is hurt on the job, you cannot sue your employer for workers compensation benefits. Fortunately for injured workers, whether or not you are considered an employee or an independent contractor is decided by a workers’ compensation judge and not the employer.
What factors will a Workers’ Compensation Judge look at to decide if you’re an employee or an independent contractor
Currently, the 1989 case of S. G. Borello & Sons, Inc. v Dept. of Industrial Relations (48 Cal.3d 341 1989) provides several factors that workers’ compensation judges will examine to decide an employee verses independent contractor dispute. In determining whether a worker is an employee or an independent contractor, the most important factor a judge will look at is the right to control, whether or not the employer exercises that right. To think about it another way, in an employer-employee relationship, the employer is interested in and controls the means, manner and mode by which the work is performed. On the other hand, the principal who contracts an independent contractor is only concerned with the results of the work and not the manner in which the results were obtained.
Judges will also look whether an employment relationship can be terminated or if the relationship can only be terminated upon completion of a contract. Judges will look at whether or not the injured worker is performing services which he performs in his own trade or business, the degree of skill involved in that service, the kind of occupation, who supplies the tools, who supplies the location where the work is completed, the length of time for the work to be completed, the method of payment for the services and whether or not the parties believe they are creating an employer-employee relationship.
Putting it all together
If you’re still confused how all those factors apply to you, you’re in good company. The law presumes there is an employer-employee relationship where a person provides a service for another. It is the responsibility of the employer to prove that you are an independent contractor and judges are going to look beyond a simple label of independent contractor. Here, I like to think of it as the tie goes to the runner and in workers compensation, the employee is the runner. If you are hurt and your boss is telling you that you are not eligible for workers’ compensation benefits because you are an independent contractor and not an employee you should consult an experienced workers’ compensation attorney even if you are paid with IRS Form 1099 and not a W-2.
While the above is the current state of the law regarding employee vs independent contractor in workers’ compensation law, a recent wage order case in 2018 may completely change the playing field if its reasoning is extended to workers’ compensation.