Workers’ compensation programs provide crucial financial support to workers who suffer injuries on the job. While these benefits are typically available to employees, self-employed individuals and independent contractors often face challenges in accessing workers’ comp coverage. In this article, we will explore the availability of workers’ compensation for self-employed and independent contractors in Colorado. We will also discuss alternative options for obtaining coverage and compensation in case of work-related injuries.
Can Independent Contractors Get Workers’ Comp in Colorado?
Understanding workers’ compensation eligibility is vital for independent contractors and self-employed individuals in Colorado. The state’s workers’ compensation system is designed to cover all employees, regardless of whether they work full-time or part-time and receive an hourly wage or salary. However, the program does not extend its benefits to independent contractors and the self-employed under Colorado law.
Colorado law defines an independent contractor as someone who exercises control over their service performance and engages in a profession, trade, or occupation related to the services provided. As long as independent contractors have not been misclassified, they are exempt from workers’ comp coverage. Additionally, certain other exemptions exist, such as for workers who perform less than $2,000 per year in repair work for a business, commission-based real estate agents and brokers, and railway workers covered under federal law.
It is crucial to confirm your proper classification as an employee or independent contractor to ensure you receive the appropriate benefits. If you believe you have been misclassified, especially if you sustain a work-related injury, it is important to explore your eligibility for workers’ comp benefits. Typically, if you receive a W-2 form from your employer at the end of the year, you should be classified as an employee under state law. Other factors may also contribute to determining your employment status.
If you are unsure of your classification or suspect your employer may have misclassified you as an independent contractor, you can still file a workers’ comp claim and allow the employer to argue your classification excludes coverage. If you are properly classified as an independent contractor, your claim will likely be denied or you can cancel your work comp claim.
Do Self-Employed Individuals Need to Purchase Workers’ Comp Insurance?
Under Colorado law, employers with at least one employee are required to obtain workers’ compensation insurance. If you are self-employed and have one or more employees working for you (excluding yourself), it is mandatory to purchase workers’ comp insurance. However, if you have no employees, the law does not mandate the purchase of workers’ compensation insurance.
Sole proprietors, corporate officers, and members of limited liability companies may also be exempt from purchasing workers’ comp insurance. Nevertheless, it may be prudent to voluntarily opt into the program to comply with contractual requirements or safeguard yourself against personal liability for medical expenses and lost wages resulting from work-related injuries.
Obtaining Coverage for Work Injuries as an Independent Contractor or Sole Proprietor
Securing financial compensation for work-related injuries can be challenging for independent contractors and sole proprietors who lack workers’ compensation insurance. Many health insurance companies do not cover accidents that occur in the workplace, and car insurance policies often exclude coverage for accidents involving vehicles used for commercial or business purposes.
However, there may be an alternative avenue for compensation through third-party insurance claims or personal injury lawsuits. Pursuing a third-party liability claim allows you to seek coverage from the responsible party’s insurance company for medical bills and lost wages resulting from a work-related injury. For example, if you were involved in a car accident while driving for work as an independent contractor, and the other driver was at fault, you could pursue compensation through their auto insurance company. In a personal injury lawsuit, you would need to establish proof of fault or negligence to recover compensation.
If you are self-employed or working as an independent contractor in Denver and sustain an injury or illness, it is advisable to consult with a workers’ comp lawyer. They can evaluate your situation and guide you through potential recovery options, including workers’ compensation coverage or pursuing a personal injury settlement.
While workers’ compensation benefits traditionally apply to employees rather than independent contractors and self-employed individuals, it is essential for those working in Denver to understand their options for coverage and compensation in the event of work-related injuries.
Independent contractors and the self-employed are generally not eligible for workers’ comp in Colorado unless they have been misclassified. Confirming your proper classification and exploring alternative avenues for coverage is crucial. If you believe you have been misclassified or are unsure of your status, consult with a personal injury lawyer to evaluate your eligibility for workers’ compensation benefits.
Self-employed individuals with one or more employees must purchase workers’ compensation insurance to comply with the law. However, if you have no employees, the purchase of workers’ comp insurance is not mandatory. Consider the potential benefits of voluntary coverage to fulfill contractual obligations and protect yourself from personal liability.
If you lack workers’ comp insurance and sustain a work-related injury, options for obtaining compensation may be limited. Explore the possibility of pursuing third-party insurance claims or personal injury lawsuits. These avenues can provide coverage for medical expenses and lost wages if you can establish fault or negligence on the part of another party involved in the incident.
In all cases, seeking guidance from a personal injury lawyer is recommended. They can assess your specific circumstances and help you navigate the complex process of obtaining compensation for work-related injuries.
Remember, understanding your rights and available options as a self-employed individual or independent contractor in Denver is crucial for protecting your financial well-being in case of work-related accidents or illnesses.