The complexities of workers' compensation for independent consultants

If you're injured while working at a client's site, can you file a workers' compensation claim? After discussing this question and other workers' comp issues with a lawyer, Chip Camden says he's more confused than ever. Find out why.

Most people hardly ever think about workers' compensation until after they've been injured on the job and need to make a claim. In that case, regular employees in most developed countries can usually rely on their employer's belonging to some form of workers' compensation insurance program that may reimburse them for medical costs and/or time missed from work. Nations and individual states vary widely on their requirements and available programs, and claims may face legal challenges -- but it's usually pretty clear at least to whom the employee should apply for relief.

Now let's say you're a self-employed, independent consultant. If you're injured while working at your client's site, can you file a workers' comp claim? Should clients do something else to make sure that consultants they hire are covered? Should independent consultants purchase their own workers' comp plan to cover these cases?

I contacted the Walthew Law Firm in Seattle, who specialize in injury, workers' comp, and disability cases. Jonathan Winemiller of that firm answered all of my questions thoroughly and politely, and now I'm more confused than ever. The short answer to each of these questions is "It depends."

For your own business, you should consult a workers' comp lawyer or a consultant who operates in your jurisdiction. Laws vary so much that an expert in one state may not be qualified to help you in another. Some states, including Washington, allow sole proprietors to buy into the state-run plan for their own business if they choose -- other states may not. In some localities, plans are privatized, and the degree to which the government controls their policies may differ. Most importantly, the regulations governing whether a particular plan would cover an injury incurred while working at a client's site vary.

Some clients may require consultants they hire to provide their own workers' comp coverage. Otherwise, you might be covered under your client's plan, if you're considered an "employee" under that plan. Even if you're a contractor, you still might qualify. Just because you receive a 1099-MISC instead of a W-2, and you aren't a statutory employee in the eyes of the IRS, doesn't necessarily dictate your stature with regard to workers' comp.

If your client is located in another state or country, that multiplies the complexity of the situation. If you have your own plan, it may or may not cover you outside of your home jurisdiction. Your client's plan may not cover workers who reside outside of their state or country. The laws governing both jurisdictions will come into play. All these questions need to be asked again if you're performing services on behalf of your client at a third location -- for example, if I, a Washington-based consultant, break my leg by tripping over a wire and falling off the stage while giving a presentation on behalf of my California client at a conference in the United Kingdom. Who pays?

Mr. Winemiller suggested that in cases of uncertain qualification, you should submit a claim to all possibly applicable plans under the assumption that one of them should pay, and the rest will get disqualified. Your client may not appreciate having you file a claim against their workers' comp plan, but they'd probably like being sued for negligence even less.

In my almost 20 years as an independent consultant, I've never devoted a single CPU cycle of my brain to this topic before it was suggested for this column by TechRepublic's own Jody Gilbert. I expect that most consultants play pretty fast and loose with the issue until they get injured on the job. Then they call in the lawyers to sort it out ex post facto.

How about you? Have you taken any precautions?

By Chip Camden

Chip Camden has been programming since 1978, and he's still not done. An independent consultant since 1991, Chip specializes in software development tools, languages, and migration to new technology. Besides writing for TechRepublic's IT Consultant b...