Workers` compensation insurance (also known as industrial insurance) provides wage replacement and medical benefits to workers who have been injured on the job. Workers` compensation is no-fault insurance, which means that in most cases, your business cannot be sued in the event of a work-related injury or illness. Type of remuneration: The company must carefully choose a payment method that is different from the payment of the company`s employees. For example, if employees are paid by the hour or monthly, the independent contractor may be paid based on the completion of the service. The agreement should stipulate that the contractor is not entitled to overtime pay. If the worker passes the personal work test in the previous tab, you do not need to continue. If the worker does not pass the personal work test, you must use the 6- or 7-part test to determine if it is an insured worker. If you use the 6- or 7-part test, remember that your employee must pass all 6 pieces to be freed from the cover (7 pieces for construction). If your employee does not pass all parts of these tests, you will have to pay workers` compensation. If you have suffered a workplace injury or occupational disease (p.B a repetitive stress injury), even if you work as an “independent contractor” from 1099, it is likely that the Industrial Insurance Act will ultimately provide you with coverage. That`s why our experienced workers` compensation lawyers at Washington Law Center unanimously recommend that you file an L&I claim through your doctor and apply for benefits. A common problem that many companies face is whether workers are properly classified as independent contractors rather than employees.

These issues arise from the various standards applied by government agencies and courts to determine whether an employee should be considered an independent contractor or an employee. According to the Internal Revenue Service, a company typically has to withhold income taxes, withhold and pay taxes on Social Security and Medicare, and pay unemployment tax on wages paid to an employee. However, these requirements generally do not apply to independent contractors. In addition, courts and government agencies such as the Internal Revenue Service, the Washington Department of Labor and Industry, and the Equal Employment Opportunity Commission apply different tests to determine whether an employee is an independent contractor or an employee. According to the U.S. Department of Labor, “the plethora of tests that define the status of an independent contractor applied in federal and state laws allows an employee to be classified as an independent contractor under one law but an employee under another.” The following describes various tests that are used to determine whether an employee is an independent contractor or an employee. The ultimate goal of our workers` compensation system in Washington is to provide “prompt and safe assistance” to injured workers and their families. 1 After decades of trial and error in enforcing our workers` compensation laws, it has become a matter of fairness and efficiency to include many “independent contractors” in the legal definition of “employee” for the purposes of workers` compensation claims. However, given the freedoms of the contracting parties (as opposed to the obvious bargaining disadvantages an employee has over their master employer), the coverage parameters are not unlimited. The final decision on coverage is not based on an employee`s name, but on the legal status the employee actually has under the law at the time of the injury.

For the required analysis, we consider two statutes, as explained in previous court decisions, to indicate when industrial insurance coverage applies to injured workers who are considered an “independent contractor.” All workers in Washington are entitled to workers` compensation unless they meet strict exemption definitions. Make sure your business understands your company`s requirements for employee coverage, including independent contractors. If it is determined that your company has employees who should have been reported for employee compensation, your company will be held liable for unpaid bonuses with penalties and interest. There are a lot of them, and each agency has its own tests. Agencies include the federal Department of Labor, the IRS, Employment Securities, and the Washington State Department of Labor and Industry. This page is written for injured workers in the Washington Labor and Industries System. If you are an employer or interested in another system, contact them or a lawyer who will do this work. The rule is clear: if the self-employed contract is essentially limited to personal work, whether manual or otherwise, then the “independent contractor” is considered a worker within the meaning of the law. In other words, coverage is then likely.

As a result, we must then understand when the essence of an independent contract went beyond personal work. The company in white v. The Ministry of Labour and Industry, 48 Wn.2d 470, describes three conditions under which no work allowance is granted to an “independent contractor”: (a) whether the independent contractor must necessarily possess or deliver to the site special machinery or equipment to fulfil the order; (b) where the independent contractor is manifestly unable to perform the contract without assistance; or (c) if the independent contractor, who necessarily or voluntarily engages others to perform all or part of the work it commissions.3 The members advise and act as a sounding board for the Director of L&I and the Deputy Director of Insurance Services in matters relating to the Crown Compensation Plan. Yes, they do. Coverage is mandatory. Almost all employees must be insured. RCW 51.08.180 indicates who is a worker. Non-compete obligation: Unlike an employee, independent contractors typically work for many businesses. Accordingly, the agreement should, as far as possible, provide that the entrepreneur is free to work for other undertakings and should not contain a non-compete obligation. Although it may be possible to include a narrowly tailored non-compete obligation, such a clause is generally avoided as it prevents the entrepreneur from working for other companies, which could imply employee status. Alternatively, confidentiality, non-disclosure and non-disclosure agreements should be in place to protect the company.

Employers provide quarterly reports and premium payments based on their industry and their employees` hours of work. Just like other types of insurance, claims are paid through collected premiums. Learn how to get a workers` compensation account. It is not uncommon for 1099 workers to suffer injuries in the workplace. Not surprisingly, it is common for employers and insurance defence interests to then rely on document 1099 or tax return status to falsely claim that the injured employee is not eligible for coverage under the Industrial Insurance Act. Because the employer error rate in this claim is so high, even if you work as a so-called “independent contractor,” you should ask your doctor to make an L&I claim on your behalf. This will trigger a more in-depth and thoughtful analysis, which you can then compare with the information provided here or with a free, non-binding consultation with one of our dedicated L&I lawyers at the Washington Law Center. The Ministry of Labour and Industry has an independent contractor test that allows businesses to determine whether they need to cover workers` compensation.

Your independent contractor must pass the Ministry of Labour and Industry tests to be exempt from workers` compensation. .