Are Independent Contractors Eligible for Workers Compensation?
Independent contractors are not eligible for workers’ compensation in Illinois. However, you can still be found to be an employee under the Illinois Workers’ Compensation Act even if you receive 1099 income and possibly even if you signed an independent contractor agreement.
The factors for determining whether an injured worker is an employee or an independent contractor are different under Illinois Workers’ Compensation law than other standards for making this determination. If you need help figuring out your workers’ compensation eligibility – reach out to our attorneys.
What is an Independent Contractor?
Independent contractors are freelancers or self-employed persons who are hired by a company to perform specific tasks without being taken on as an employee. The IRS provides this definition as a basis:
“The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done.”
Determine if you are an employee or an Independent Contractor receiving a 1099 income
While true independent contractors are not eligible for workers’ compensation in Illinois, there are many situations in which an employee is misclassified as an independent contractor when they in fact meet conditions that qualify them as an employee under Illinois Workers’ Compensation law. Some companies misclassify individuals as independent contractors rather than employees in order to save money, and that’s why your legal representation matters.
Get more information on the basics of workers’ compensation →
Understand How You Have Been Classified By Your Employer
How can I tell If I’m incorrectly classified as an Independent Contractor when seeking workers’ compensation?
The main factor in determining whether an independent contractor has been misclassified and is thus eligible for workers’ compensation benefits is how much control the employer has over the worker and their schedule — the more control an employer has over the contractor, the more likely it is that the contractor has been misclassified, and as such will be eligible for benefits if they’re injured on the job.
Some other factors that may affect an independent contractor’s eligibility for workers’ compensation benefits are:
- Whether the employer took taxes out of their checks.
- Whether the contractor was exclusively bound to the employer or if they could work for whomever they wanted.
- Whether a uniform was provided by the employer.
- Whether tools or other materials were provided by the employer.
- Whether the worker set their own hours or was given a schedule.
- Whether specific instructions on how to do the job were provided or the worker was allowed to decide how to approach the job.
How can I tell if I’m correctly classified as an Independent Contractor and NOT eligible for workers’ compensation?
Working off of the points discussed above, you may correctly be classified as an independent contractor and thus not be eligible for workers’ compensation if:
- You were given the freedom to set your own hours and your approach to completing your job was left fully to your discretion.
- You did not have taxes taken out of your paychecks and you paid self-employment taxes.
- You used all of your own equipment and materials to complete your job.
This list is not exhaustive. NOTE: FAILING TO MEET ALL FACTORS IS NOT DETERMINATIVE BY ITSELF YOU MAY STILL BE CONSIDERED AN EMPLOYEE. IT IS A BALANCING TEST.
If an employer claims that you are an independent contractor but you believe that you may qualify for workers comp benefits based on the factors discussed above, you may be able to collect benefits. Contact us to learn more.
If your employer is claiming you are an Independent Contractor and you were injured while working, our team can help.
Our accomplished Illinois workers’ comp attorneys have a proven record of successful workers’ compensation settlements and verdicts, including an influential and often cited case where a bike messenger was found to be an employee rather than an independent contractor.
The insurance company asserted our client was an independent contractor and the Court disagreed — our client received full compensation.
We will fight hard to help you, too. Don’t delay getting the compensation you deserve: schedule a free consultation with our workers’ compensation attorneys today.