We were recently asked by a client who owns a small business whether she is required to maintain workers compensation insurance for independent contractors. The answer is no as long as the job they are performing is truly in the capacity as an independent contractor.
A worker is considered an independent contractor if the following criteria are met: (1) is the worker outside of the control of the employer, i.e. they decide how to do the job and perform it the way they choose; (2) is the work done by the independent contractor perform work outside of the business or tasks that are no ordinary to the business’s; and (3) does the worker have other employment or their own business.
This is a general test, but a more fact specific review must be done to determine whether the worker is an independent contractor. It will also vary based on the state where the worker is employed. You should request an opinion letter from an employment lawyer or from the Department of Labor.