Workers’ compensation is insurance coverage which must be carried by most employers in Colorado.  In most instances, if you are injured on the job, you should receive workers’ compensation benefits.  There are, however, some instances when you may not be entitled to workers’ compensation insurance coverage.

The following is a partial list of occupations and/or individuals excluded from providing mandatory workers’ compensation insurance coverage under the Workers’ Compensation Act:

  • Certain casual maintenance or repair work performed for a business for under $2,000 per calendar year;
  • Certain domestic work, maintenance or repair work for a private homeowner that is not done full time;
  • Licensed real estate agents and brokers working on commission;
  • Independent contractors who perform specific for-hire transportation jobs;
  • Drivers under a lease agreement with a common or contract carrier;
  • Any person who volunteers time or services for a ski area operator;
  • Persons who provide host home services as part of residential services and supports;
  • Federal employees (covered under federal laws);
  • Railroad employees (covered under federal laws);
  • Independent contractors (see next paragraph).

The status of independent contractor has been one of the most litigated areas in workers’ compensation since the inception of the Workers’ Compensation Act. In order to establish an independent contractor status, the employer must prove the existence of an employer – employee relationship the employer must then prove:

  • The individual is free from control and directions in performing the services; and
  • The individual is customarily engaged in an independent trade, occupation, profession or business which is related to the performed service.

Most courts generally consider nine (9) factors when determining the independent contractor status of an individual.  Below is a list of the factors considered which are indicative of an independent contractor.

  1. The individual does not work exclusively for the contracting party. The individual, however, can “choose” to work for a specified, finite time.
  2. There are no quality standards for the individual. Plans and specifications can be provided, however.
  3. The individual is paid at a fixed or contract price.
  4. Services can be terminated during the contract only if the individual violates terms of the contract or fails to meet contractual specifications.
  5. Minimal training or less is required.
  6. The contracting party provides nothing more than material and equipment necessary for the job.
  7. The individual determines the time of performance. It is permissible if the document sets forth a complete schedule and a “range” of negotiated and mutually agreeable work hours.
  8. Payment for the contracted services is made to a trade name or business entity.
  9. The business operations of the individual and the contracting party are separate and distinct.

The determination whether an individual is an independent contractor or employee is fact driven.  The courts generally entertain the totality of circumstances surrounding the employment relationship to make a determination.