Are Independent Contractors Covered Under an Employer’s Worker Compensation Policy?

Alex is a new employee working on an active construction site under a general contractor. He got the job through a staffing agency and was asked to bring his tools. He is injured on the job while utilizing a pallet jack lift provided by the employer. His foreman informed him he is not covered under workers’ compensation insurance because he is an independent subcontractor. Is this true?

If you have been injured at work and are unsure whether you qualify for workers’ compensation, a Utah workers’ compensation lawyer can help.  

Understanding Who is Covered 

All direct hires and employees are covered under an employer’s workers’ compensation policy, regardless of whether the employee works part-time or full-time, or a hybrid, in-person, or remote schedule. In addition, employees who are hired “under the table” may also be covered if they are injured in a workplace incident. However, if that employee is to file with the workers’ compensation commission of their state, it would trigger an investigation into the employer’s hiring practices, and the employer would most likely be subject to fines and penalties for failing to legally hire an employee and pay employer payroll taxes and workers’ compensation premiums. 

In Utah, independent contractors are not covered under traditional workers’ compensation policies. Many directly hired employees might be led to believe that they are independent contractors for the employer to avoid paying workers’ compensation premiums or other benefits for which a direct-hire is eligible. Workers’ compensation insurance covers accidental injuries that occur at work, during work hours. Insurance also covers occupational diseases that may occur such as exposure to silica, particulate dust, or asbestos.  

Determining an Employee’s Work Status 

Determining what an employee’s status is at a workplace is crucial. This controls whether an employee is eligible for insurance coverage or not. What distinguishes an employee from an independent contractor is based on several factors. This includes whether the worker supplies their own tools and equipment, whether the worker makes their own hours and schedule, how the worker is paid, and how often. For example, an independent contractor is often paid per job completed, not on an hourly rate. This is similar to a gig worker who might be paid per assignment, per concert or per event instead of steady, weekly hours. An independent contractor will make their own schedule, supply their own equipment, and often needs little to no guidance from the employer to complete the job.

For example, a subcontractor plumber on a construction site would not take direction from a general contractor. The subcontractor is hired to complete the plumbing work with his own tools using his own expertise. This distinction is muddled when an employee is hired via a staffing agency, has no ownership or authority over how a job is completed or maintains a regular weekly schedule similar to other directly hired employees. Because this distinction is linked to obtaining benefits in a workplace accident, it is crucial you hire a workers’ compensation attorney in Utah to evaluate your claim

Call Our Logan Workers’ Comp Attorneys 

Workers’ compensation statutes are unlike any other discipline of the law. It also varies greatly from state to state, and navigating a claim is complicated. Unfortunately, in Utah, independent contractors are not covered under an employer’s workers’ compensation insurance policy. But whether or not someone is an independent worker is not always evident, meaning benefits an employee is eligible for is hanging in the balance. If you were injured on the job, it is crucial that you speak to a seasoned workers’ compensation attorney as soon as possible. Our attorneys at Harris, Preston & Chambers specialize in workers’ rights and can help you file a claim and get your life back. Call today to schedule a free consultation.