The following is quoted from the “Independent Contractor Guide” by the Washington State Dept. of Labor & Industries. You can download a copy here.
In some cases, someone you consider an “independent contractor” is actually a worker who has legal protections that cannot be waived. If so, you may be an employer with “covered workers” under Washington workers’ compensation law and not realize it.
It is important that you understand your requirements. Otherwise, your business may be vulnerable to unexpected regulatory penalties and even lawsuits.
In Washington, every worker is presumed to be a “covered worker” for purposes of workers’ compensation coverage unless they fall into the few narrow exceptions provided by law.
If the person you hire or contract with is a “covered worker” under Washington State workers’ compensation law, then as an employer, you have certain legal responsibilities, such as to:
- Keep accurate records.
- Pay workers’ compensation premiums.
- Follow state employment laws.
Please be aware that:
- Simply calling a person an independent contractor does not automatically exempt you from your legal obligation to pay workers’ compensation premiums.
- In some cases, a person may be an independent contractor on one contract but not on another. Each contract must be evaluated separately.
- A person can be an independent contractor for federal tax purposes but still be a covered worker for Washington State workers’ compensation purposes.
Other government agencies, such as the Washington Employment Security Department and the Internal Revenue Service, have their own laws and regulations concerning independent contractors. Consult those agencies and your advisors for guidance in meeting their requirements. Additional resources for other agencies are included on the back cover of this publication.
This publication is a general guide to help you understand how and when the Department of Labor & Industries applies workers’ compensation laws to independent contractors.
Click here to download PDF.