Independent contractors cannot get workers’ comp in SC like employees can. However, whether someone is classified as an independent contractor for workers’ comp depends on the nature of the work. It’s not necessarily determined by the title or classification given to them by the employer.
Experienced Greenville workers’ compensation lawyer Bobby Jones explains workers’ comp for independent contractors and what you need to know.
The Legal Definition of an Independent Contractor in South Carolina
An independent contractor in South Carolina is paid to complete work, but not as an employee of the entity they are working for. They are responsible for only the result of the work, without the employer controlling or directing the way the work is done.
Who is an independent contractor?
The Upjohn Institute reports that up to 15% of U.S. workers are independent contractors in their main employment. Independent contractors can do many things. Uber drivers, photographers and videographers, consultants, doctors, accountants, and other professionals are just a few examples of independent contractors.
S.C. workers’ comp law defines an employing unit as any service performed for wages under a contract of hire. Employment agreements may be written or oral, express or implied.
Example of an independent contractor vs. employee
For example, you have a plumbing issue at your house. You call a plumber. You hire the plumber to fix the leak. The plumber is not your employee. They’re responsible for the result, which is fixing the leak at your house. In this case, the plumber is an independent contractor.
On the other hand, say you own a plumbing business. You hire four employees to respond to calls for service. You provide them with company vehicles, work uniforms, tools, and equipment.
You invoice work they perform and collect payment. The workers must follow company policies, with set working hours, quality control checks, and other requirements. You have the right to fire these workers. The workers are your employees.
Does SC workers’ comp cover independent contractors?
In South Carolina, workers’ compensation covers employees. If a person is an independent contractor, they generally cannot claim workers’ compensation benefits for an on-the-job injury.
How does SC decide who is an independent contractor for workers’ comp?
When determining who is an independent contractor for workers’ comp, South Carolina looks beyond the title given to the person. It is a fact-specific inquiry that looks at how the business relationship operates. Factors that may be crucial include:
- The degree of control that the employer exercises over the person’s work
- Furnishing equipment for work
- Method of payment
- Right to fire
An independent contractor works under their own methods and is responsible only for the product. South Carolina law evaluates the authority of the employer to direct and control the person’s undertaking.
Why Independent Contractors Are Typically Excluded from Workers’ Comp
Independent contractors are typically excluded from workers’ compensation because if the employer cannot control the method of work, they should not be held responsible for the worker’s safety. Independent contractors are typically excluded from many benefits of employment, like health insurance, tax withholdings, and retirement plans.
When a Contractor Might Be Eligible for Benefits
A contractor might be eligible for benefits if they are genuinely an employee and they are misclassified as an independent contractor. They may also have workers’ compensation as part of their work contract, or if they separately elected it, but this is rare.
In addition, if the entity they contract with is responsible for negligence or breach of contract, the person may have a claim for damages.
Misclassification and How It Affects Your Rights
Employers often fight workers’ compensation claims on the basis that the worker is an independent contractor rather than an employee. But the employer may misclassify the employee. If the employer has misclassified the employee, the worker may claim benefits if they are hurt on the job and otherwise qualify for workers’ compensation.
Workers who may be misclassified as independent contractors include:
- Workers for wages
- Salaried employees
- Commissioned employees
- Contract of hire or no contract of hire
- Officers and corporate leaders
- Nurses and other healthcare professionals
- Agents, those who perform services for remuneration
- People working for a contractor or subcontractor
- Consultants, freelance workers
- On-call workers, temporary workers
- Those who see themselves as gig workers, performing a “side hustle,” or see their work as “odd jobs”
The Bureau of Labor Statistics reports that some industries have especially high rates of independent contractors, including media, entertainment and sports, construction, maintenance, and service occupations.
Note: S.C. law specifies that employment does not include an individual or entity that owns or leases a truck or other vehicle with a valid independent contractor agreement to provide driving services to a motor carrier.
What To Do If You’re an Injured Contractor Denied Coverage
If you’re an injured contractor and denied workers’ compensation, there may be several avenues to receive compensation. If you are improperly classified, you may challenge the denial and take your case to a hearing. The South Carolina Workers’ Compensation Commission will decide. If the result of the proceedings is that you are an employee, you may claim benefits available under South Carolina workers’ compensation laws.
If you should receive benefits, but the employer doesn’t have the insurance they’re supposed to have, you may seek compensation from the Uninsured Employers’ Fund. State investigators may recoup the cost of benefits directly from the employer.
Employer penalties
An employer who improperly classifies workers as independent contractors may face tax penalties, violations of wage and hour limitations, unemployment law violations, increased scrutiny from regulators, and reputation damage.
Filing a Lawsuit When Workers’ Comp Is Not an Option
You may file a personal injury lawsuit against an employer if you are ineligible for workers’ compensation benefits. A third party may have liability if their negligence or more serious misconduct is the cause of an injury.
Contact an Experienced Greenville Workers’ Compensation Lawyer
We invite you to contact Bobby Jones Law to review your case. See if you may claim benefits as an employee or independent contractor and what may be involved in making your case. Talk to an experienced workplace injury lawyer today.
