Do Independent Contractors Qualify for Worker’s Compensation in Wisconsin?

Wisconsin’s worker’s compensation law covers many workers who are classified as “independent contractors” by their employer. For someone to be considered a truly independent contractor - and therefore not covered by their employer’s worker’s compensation insurance - a worker needs to meet 9 factors specified in Wis. Stat. 102.07(8). The bottom line is that few workers who are categorized or thought of as “independent contractors” by their employer fall under this standard. Instead, many of them are considered employees under Wisconsin worker’s compensation law and are entitled to worker’s compensation benefits.

This includes workers in the “gig” economy, including drivers for ride sharing or food delivery companies such as Uber, Lyft, Doordash, Grubhub, and the like. Even if a person is indeed an independent contractor for purposes of tax and employment laws, they may still be considered an employee and not an independent contractor under Wisconsin’s worker’s compensation law. If you suffered a serious work injury that resulted in permanent disability, permanent wage loss, or significant amounts of lost time from work, and your workers' compensation benefits were wrongfully denied because you were categorized as an independent contractor, contact Kingree Law today. Attorney Luke Kingree can evaluate your situation and help you recover the benefits you deserve.

Who Qualifies As an Employee in a Claim for Wisconsin Worker’s Compensation Benefits?

Under the Wisconsin Worker’s Compensation Act, Wisconsin employers must provide no-fault worker’s compensation coverage for employees. They are not required to provide workers’ compensation coverage for independent contractors.

The Wisconsin Department of Workforce Development uses a precise definition of “independent contractor.” To qualify as an independent contractor, a worker must satisfy a nine-factor test specified in Wis. Stat. 102.07(8). If even one of these factors is not met, the injured worker should be categorized as an employee and is eligible for worker’s compensation benefits.

To correctly categorize a worker as an independent contractor, the worker must satisfy all of the following nine elements:

1. Maintain a separate business.
2. Obtain a Federal Employer Identification Number (FEIN) from the IRS or file business or self-employment taxes (a social security number cannot be substituted for a FEIN and does not meet the burden under the statute).
3. Operate under a specific contract.
4. Be responsible for operating expenses under the contract.
5. Be responsible for satisfactory performance of the work under contract.
6. Be paid per contract, per job, or by commission by competitive bid.
7. Be subject to profits or loss in performing the work under contract.
8. Have recurring business liabilities and obligations.
9. Be in a position to succeed or fail depending on the business’s expenses and income.

When evaluating an injured worker’s eligibility for worker’s compensation benefits, the only definition that matters is the one used in Chapter 102 of the Wisconsin statutes. Any other definition of independent contractor, such as for tax purposes, general employment law, the federal definition of independent contractor, or another state’s definition, is irrelevant.

In practice, almost all Wisconsin workers should be classified as employees and covered under the Wisconsin Worker’s Compensation Act. Anyone paid an hourly rate is an employee. Anyone working on a basis other than a specific contract is an employee. If the employer retains control over the worker’s performance, the worker is likely an employee under Wisconsin worker’s compensation law.

Worker Misclassification Is a Serious Problem in Wisconsin

Unfortunately, too many Wisconsin businesses misclassify workers as independent contractors and use this misclassification as a basis to deny worker’s compensation benefits.

Wisconsin’s nine-part test to categorize a worker as an independent contractor is comprehensive. Employers must satisfy strict requirements when classifying a worker as an independent contractor instead of an employee for worker’s compensation purposes.

If you were seriously injured on the job and suffered permanent disability, permanent wage loss, or significant lost time from work, do not assume you are not entitled to worker’s compensation benefits just because you were classified as an independent contractor. Kingree Law Firm can analyze your situation and fight for the benefits you deserve.

What If My Employer Does Not Have Worker’s Compensation Coverage?

Some Wisconsin businesses try to classify all their workers as independent contractors and claim they have no employees. In these situations, the injured worker can recover benefits through the Wisconsin Uninsured Employer’s Fund. The Fund steps in to provide injured workers with worker’s compensation benefits as if their employer had been insured, then aggressively pursues penalties and the full cost of the injured worker’s benefits from the employer.

Contact Kingree Law Firm for Serious Work Injuries

If you were seriously injured at work and experienced significant wage loss or permanent disability and your worker’s compensation benefits were wrongfully denied, Kingree Law Firm can help. Luke Kingree has been recognized as a Wisconsin SuperLawyer and is known as a powerful advocate for injured workers who regularly achieves exceptional results for his clients. Contact Kingree Law today to schedule an appointment to discuss your situation.