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Workers’ Compensation: When is an Employee not an “Employee,” even if they work for you?

We are frequently asked whether or not an individual is considered an “employee” for workers’ compensation purposes, and, in fact, were specifically asked to address this in an article.  Unfortunately, the answer is generally neither simple nor short, and almost always fact specific.

Though Workers’ Compensation statutes vary slightly from state to state, Virginia’s body of law is indicative.  Va. Code § 65.2-101 defines “employee” expansively, including more than 20 subparts, ranging from Americorps members and certain food stamp recipients to first responders (and volunteer firefighters specifically), some volunteers, and apprentices.  Just to make things more complicated, the definition also excludes a number of things from the term “employee”, with over 15 subparts there as well. Caselaw is slightly less opaque – but not much.

“Pay” is not dispositive.  In the context of “volunteers,” the Virginia Supreme Court has found that even purely “gratuitous” work may render someone an “employee”: “If the voluntary act of an employee which causes an injury is sufficiently related to what the employee is required to do in fulfilling his contract of service, or is one in which someone in a like capacity may or must do in the interest of his employer’s business, the fact that the employee was not actually required to perform the act will not impair his right to recover compensation.” Lucas v. Lucas, 212 Va. 561, 564, 186 S.E.2d 63, 65 (1972) (citations omitted).

The Virginia Court of Appeals has, however, found that a claim involving death resulting from a “side job” that otherwise was within an employee’s ordinary sort of work was not compensable: “Moreover, while [claimant] was an ongoing employee of P&C, according to the testimony of Boothe, [claimant] was not engaged in P&C’s employ at the time of the accident. The commission found as a fact that he was engaged in a “side job” essentially as an independent contractor.”   Keene v. Boothe, Record No. 2641-00-3, 2001 Va. App. LEXIS 270, * 12-13 (Ct. App. May 22, 2001) (citations omitted).

Independent contractors can be especially complicated.  ‘An independent contractor [] prosecutes and directs the work himself, using his own methods to accomplish it.’ [] ‘The ordinary test is this: [] Who has the power to control and direct the servants in the performance of their work?[]'”  Creative Designs Tattooing Assocs. v. Estate of Parrish, 56 Va. App. 299, 308, 693 S.E.2d 303, 308 (Ct. App. 2010) (citations omitted)).  However, the same Court has ruled that “‘the mere fact that [an employer] may have intended to hire the claimant as an independent contractor is not determinative.’  Rather, the facts of each case must be examined to determine the status of a claimant at the time of his or her injury.”  North Star Home Improvement, Inc. v. Heddings, Record No. 2350-03-4, 2004 Va. App. LEXIS 81, *7 (Ct. App. Unpub., Feb. 17, 2004) (citations omitted).

The bottom line is this – if you have any serious doubts about whether a potential claimant is or is not an “employee” entitled to benefits under the Virginia (or any other) Workers’ Compensation Act, you need to have a discussion with an attorney to allow them to consider the facts and the current law.  If they are clearly an independent contractor, or fall into another clearly excluded category, maybe not, but it would still be best to get a formal legal opinion on that question. If you’d like to discuss this topic, please contact Dov Szego at dszego@setlifflaw.com or 804.377.1263 or Steve Setliff at ssetliff@setlifflaw.com or 804.377.1261.