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Independent Contractors and Workers’ Compensation

March 8, 2017

Are you considered an “Independent Contractor” rather than an employee to the company you work for? Many workers assumingly falling under this job title continually ask the same, unclear question: Am I protected under North Carolina’s Workers’ Compensation, despite the association with my company? Here’s what you need to know about your rights to wages and benefits as an employee.

What is an independent contractor?

According to the NC Justice Center’s Workers’ Right Project, an independent contractor is “a worker who provides goods or services to another individual or business through an agreement.” The terms of the agreement, which can be legally written out or verbally agreed upon, determine the relationship between the worker and employee. Independent contractors are to treat a company as a customer or client, not an employee, because they might be working multiple clients at one time. Many workers question whether they are an independent contractor or employee, but it varies by situation. If you’re completely unsure, consider the following circumstances:

You may actually be an employee if an employer:

  • Controls the way you handle your job (how, when, and where you work)
  • Determines your hours
  • Provides the supplies needed to complete your job
  • Trains you on how to do your job
  • Uses constant supervision over you

Another important factor to look at is how taxes are paid. If an employer provides you with a 1099 tax form instead of a W-2, then they identify you as an independent contractor. This also holds true if you’re paid by cash and no taxes are taken out.

So what does this mean for workplace accidents?

It’s extremely important to recognize that an employer is not off the hook of providing workers’ compensation by classifying someone as a contractor instead of an employee. If you’re injured on the job, courts look past whatever terms of agreement were established and review actual facts to decide if you’re an employee or not. The North Carolina Industrial Commission looks into several factors to determine a worker’s title, including if the worker:

  • “Is engaged in an independent business, calling, or occupation”
  • “Uses special skill, knowledge, or training in the execution of the work”
  • “Is doing a specified piece of work at a fixed price or for a lump sum or upon a quantitative basis”
  • “Is not subject to discharge because he adopts one method of doing the work rather than another”
  • “Is not in the regular employ of the other contracting party”
  • “Is free to use such assistants as he may think proper”
  • “Has full control over such assistants”
  • “Selects his own time”

If the courts agree that a worker is an employee, then the employer is responsible for providing benefits by the law of the North Carolina Workers’ Compensation Act. But if they believe that a worker is an independent contractor, then the employer is not liable for the contractor’s workers’ compensation claim and the Industrial Commission has no jurisdiction on the matter.

The conversation about independent contractors and workers’ compensation is never ending, not to mention a stressful situation to be involved in. If you’re an independent contractor that’s been injured on the job, and have been fighting for workers’ compensation benefits because you believe you’re a legal employee, contact the Workers’ Compensation Law Firm immediately. Our lawyers are ready to help pursue the aid you need, and prove to the courts where you stand with your employer.