Workers’ Compensation is controlled by Kentucky State Law. Specific exemptions to the Kentucky Workers’ Compensation Act are provided in KRS 342.650. The exemptions include farm workers and domestic servants. Also exempted from workers’ compensation coverage are independent contractors. If a person is exempt from the Workers’ Compensation laws then the employee is not responsible for providing insurance for the person if they are injured on the job.
In Holman Enterprise Tobacco Warehouse v. Carter, 536 S.W.2d 461 (Ky. 1976), the court decided that workers’ compensation coverage requires an employer/employee relationship, and that individuals who operate as independent contractors are excluded from coverage. The issue was further addressed in Fields v. Twin City Drive-In, 534 S.W.2d 457 (Ky. 1976), which found that the main difference between an employee and an independent contractor is that an employee is “in the service of an employer under a contract of hire,” while an independent contractor is not.
Determining whether a person is an employee or an independent contract has been debated by the courts at length. The court stated in Brewer v. Millich, 276 S.W.2d 12 (Ky. 1955), that the key factor to determine one from the other is “control.” If a person has control over the details of the work to be accomplished it makes it more likely they are an independent contractor.
The Kentucky Supreme Court addressed this distinction in UEF v. Garland, 805 S.W.2d 116 (Ky. 1991), setting out a four factor test. The factors are:
1. nature of the work as related to the business generally carried on by the alleged employer;
2. extent of control exercised by the alleged employer;
3. professional skill of alleged employee; and
4. the true intent of the parties.
The classification of an individual as either an employee or independent contractor is still a heavily litigated issue. Many employers try to minimize cost by designating a person as an independent contractor to avoid having to purchase workers’ compensation insurance coverage. However, just calling a person an independent contractor does not make them one in the eyes of workers’ compensation law. In the end it comes down to the amount of control the employer has and the specifics of the job.
Determining whether a worker will be classified as an employee or an independent contractor may require the help of an experienced lawyer. If you have been harmed by a work related injury contact an attorney to learn about your rights and options as soon as possible, call at (859) 209-2101.