Are Contractors Covered by Workers' Compensation?

Workers' compensation is an important part of any workplace. It is designed to protect employees who obtain work-related injuries. This state program will cover medical care and lost wages. However, this is only designed for employees of companies that have workers' compensation insurance. With a contractor, things get a little more complicated.

In the state of Ohio, the extent to which a contractor is covered by workers' compensation depends on a number of factors, including the classification, the contract, and the nature of the work. Our team can help answer questions like What does workers' compensation cover?

Understanding How Workers' Compensation Works in Ohio

Before one can understand if contractors are covered by workers' comp insurance, they must understand how workers' compensation coverage works in Ohio. Per state laws, Ohio is called a monopolisic state. This means that there is a state fund system for workers' comp. Every business must have coverage through the Ohio Bureau of Workers' Compensation. Ohio's system ensures that there is uniform administration of workers' comp benefits and claims.

With this type of system in place, employees who receive work-related injuries or illnesses are protected. Ohio's workers comp covers medical costs, missed wages, rehab costs, and in the most severe cases, long-term disability benefits. However, in Ohio, what workers compensation benefits cover depends on employment classification. This is where independent contractors may not be covered under a workers' compensation policy. For more information, a Columbus workers compensation attorney may be able to help.

Are Independent Contractors Employees?

In Ohio, the law distinguishes the difference between employees and independent contractors based on specific criteria. The main criteria that is used is the degree of control that is exerted by the employer. If the worker in question performs under the supervision of the employer, if they use tools that are provided by the employer, and if they follow specific work hours, they are more likely to be considered an employee. This would make that person eligible for workers' compensation benefits.

Contractors, however, tend to work in a different way. They generally have full control about how often and when they work. Additionally, they use their own tools and take on their own business expenses. Since they are not considered an employee under Ohio law, they are typically not covered by workers' compensation, even if they are injured while performing work for someone else.

Exceptions and Special Cases for Contractors

Generally, contractors are not included in workers' compensation coverage. However, there are some exceptions:

Misclassification of an Employee as a Contractor

In Ohio, one of the most common exceptions is when an employer misclassifies a worker as a contractor. Typically, they do this in order to avoid paying workers' comp premiums. If an actual employee is incorrectly designated as a contractor, but they meet the legal definition of an employee, they may still get workers' compensation benefits. In this case, the Ohio BWC or a lawyer can work to reclassify these people, which will entitle them to coverage.

The Construction Industry and Subcontractors

There are also a lot of exceptions in certain industries. In construction, for instance, there are many workers who operate as subcontractors. A general contractor, for instance, will often assume that a subcontractor is an independent contractor. Thus, they would not be covered under workers' compensation. However, if a subcontractor doesn't have their own workers' comp coverage, the general contractor might be held liable for providing coverage for the subcontractor.

Self-Employed Workers and Sole Proprietors

Self-employed workers and sole proprietors are not required in the state of Ohio to carry workers' compensation coverage. However, they do have the option to purchase it through the Ohio BWC. Many contractors in Ohio voluntarily purchase coverage to protect themselves and cover medical expenses in case of a work related injury. This is most common among small business owners who work as self-employed roofers, electricians, plumbers, or other type of service professional.

Work Performed on a Public Project

Finally, if independent contractors work on a public project in Ohio, they may be required to carry their own coverage. Oftentimes, government contracts require that all workers, including a contractor, are covered.

What Happens if a Contractor is Injured While on the Job?

If an independent contractor obtains an injury or illness while on the job, they typically don't have a lot of protection when compared to someone who is covered by workers' compensation insurance.

However, they still have some options:

Filing a Claim if Misclassification Has Occurred

If a contractor believes that they have been misclassified and should legally be covered by workers comp insurance, they can file a claim with the BWC. The bureau will then review the claim and determine if the person is eligible for coverage.

Filing a Personal Injury Lawsuit

Another option injured workers not covered by a workers comp policy have is to file a personal injury lawsuit against the hiring company. To do this, the contractor and their attorney must prove that negligence played a role in the injury or illness. For example, if a workplace injury occurred due to an unsafe work condition on a job site, the contractor can seek compensation.

Using Private Insurance

Since contractors aren't automatically covered by workers compensation insurance, many do have private insurance. These policies may provide financial protection that is similar to workers comp insurance. Larrimer & Larrimer is also able to answer questions such as How much does workers’ comp insurance cost?

Getting Assistance Through a Third-Party Liability Claim

Finally, if a contractor is injured by a third party, such as another contracting business, an equipment manufacturer, or a supplier, they may be able to file a claim against that party. This is common on construction sites where multiple entities are operating on the same worksite.

Reach Out to Larrimer & Larrimer for Workers' Compensation Cases

For those who have been injured on the job, the workers comp lawyers from Larrimer & Larrimer may be able to help. Since 1929, the team at Larrimer & Larrimer has been helping Ohio contractors and workers get the best possible results from their workers compensation claims. For those who want to see if they have a case, call today.