Can Independent Contractors Get Workers’ Comp Benefits in North Carolina?
Workers’ compensation laws ensure that workers who are hurt on the job can receive appropriate financial benefits, which pay for medical treatment while partially replacing the injury victim’s wages. However, the term “worker” can cause confusion. Employees and independent contractors both perform work – but the way they are treated under North Carolina’s workers’ compensation laws are very different. If you are an employee or contractor who was recently injured at work in North Carolina, contact the Charlotte workers’ compensation attorneys of the Ramsay Law Firm for a free consultation about whether you could qualify to receive benefits.
Independent Contractors vs. Employees: What is the Difference?
Independent contractors, subcontractors, and employees are all paid to perform work, but there are important legal differences in how these terms are defined. Generally speaking, an employee must follow specific rules that are determined by his or her employer, such as how to dress, what procedures to follow, and what programs or materials to use. By comparison, an independent contractor can use his or her discretion when determining how best to complete a job or assignment, provided the finished product meets the time and budget specifications that the contractor and employer agreed upon at the outset of the project.
Unfortunately, there is no cut-and-dried law that clearly delineates independent contractors from employees. To quote the Internal Revenue Service (IRS) on this matter, “People such as doctors, dentists, veterinarians, lawyers, [and] accountants… in an independent trade, business, or profession… are generally independent contractors. However, whether these people are independent contractors or employees depends on the facts in each case.”
Due to this ambiguity, there is no way to know in advance how the judicial system, nor the North Carolina Industrial Commission (which manages the state’s workers’ comp program), will rule as to an individual worker’s employment status should a claim or dispute arise. These matters must be decided on a case-by-case basis by examining the nature of the labor, and the relationship between the worker and the employer. Being represented by a skilled workers’ comp attorney increases the likelihood that the courts or Commission will make an appropriate determination as to whether the worker was properly classified and should – or should not – be awarded benefits for a work-related accident.
Do Independent Contractors Qualify for Workers’ Comp Benefits in NC?
Unfortunately, it is fairly common for employers to intentionally misclassify employees as “independent contractors” – particularly when the economy is struggling – because it relieves the employer from needing to meet costly legal, financial, and tax requirements. For instance, the Internal Revenue Code (IRC) generally requires employers to withhold and match FICA taxes (Social Security and Medicare taxes), whereas this requirement is absent for independent contractors, who receive a Form 1099 instead of a Form W-2. Likewise, classifying workers as independent contractors can potentially relieve employers from providing workers’ compensation insurance coverage, which is a requirement for most employees in North Carolina. However, workers must be classified properly without abusing the law.
While there are some cases where independent contractors are entitled to receive benefits, in many instances the laws do not apply to contractors in North Carolina. However, there is a notable exception that pertains to certain trucking owners/operators. To quote the Industrial Commission on this subject, “North Carolina law requires that workers’ compensation coverage be in place to cover certain trucking owner/operators, even if the operator is deemed to be an independent contractor.” However, as the Commission then points out, this requirement does not exist if the following statements apply to the independent contractor who was injured:
- The independent contractor personally drives the vehicle him- or herself.
- The independent contractor has been personally licensed by the U.S. Department of Transportation (USDOT).
These provisions stem from state law, G.S. § 97-19.1(b), which provides that a contractor “shall not be liable as an employer… for the payment of compensation on account of the injury or death… if the [contractor] (i) contracts with an independent contractor who is… licensed by [USDOT] and (ii) the independent contractor… is operating the vehicle [using] that license.”
Charlotte Workers’ Compensation Lawyers Can Help if You Were Injured in a Job-Related Accident
While state laws provide robust protection for employees who sustain job-related injuries, they, unfortunately, offer less protection for contractors. If an independent contractor wishes to be protected in the event of accidental workplace injury, he or she would be wise to consider purchasing their own workers’ compensation coverage, disability insurance, or liability insurance.
That being said, there are situations where independent contractors can prevail in court. However, because the law is typically tipped against contractors, it is crucial for contractors to have aggressive, highly experienced legal representation – particularly in cases where it is suspected that the employer has intentionally misclassified an employee in order to cut costs. The bottom line is that you should always speak with an attorney if you are injured at work, especially if you have sustained permanent or catastrophic injuries, such as spinal injuries or head injuries. For a free consultation with an experienced Charlotte workers’ compensation lawyer for truck drivers, contact our Charlotte injury law firm online, or call us today at (704) 376-1616 to discuss how we can help.