Can Subcontractors Receive Workers’ Compensation Benefits in Illinois?
Whether a subcontractor is eligible for workers’ compensation benefits in Illinois depends on their legal employment classification. While legitimate independent contractors are typically not covered by workers’ compensation, many workers classified as subcontractors may actually be misclassified employees under Illinois law.
The Illinois Employee Classification Act (ECA 820 ILCS 185) was created to address improper worker classification in the construction industry and applies to both public and private construction projects. The Illinois Department of Labor has also issued guidance to assist in the proper classification of workers. However, neither of these is the final word as to whether someone is an independent contractor or an employee under the Illinois Workers’ Compensation Act. In fact, it is not uncommon to be considered an independent contractor under one law but still be considered an employee for purposes of workers’ compensation benefits.
How Does Illinois Determine if a Worker is an Employee or a Subcontractor?
The Illinois Workers’ Compensation Commission evaluates the working relationship between a company and the worker. One of the most important factors is the level of control the employer has over the worker’s job duties. If the company directs how, when and where the work is completed, the worker may be considered an employee rather than an independent contractor.
Under Illinois law, the Commission often finds workers are independent contractors where the following conditions are present:
- A worker controls the manner of and time of the work performed;
- A worker provides the tools and materials to perform the work;
- Work falls outside the employer’s usual business;
- A worker operates an independently established business or trade;
- A worker is paid by 1099;
- A worker is not exclusively working for the employer, but free to work for other businesses.
If these standards are not met, a worker may be entitled to employee protections, including workers’ compensation benefits.
Why Are Workers Misclassified in the Construction Industry?
Misclassification—whether intentional or accidental—is common in the construction industry and can leave injured workers without access to workers’ compensation coverage and other employment benefits. Some of the reasons construction companies may classify workers as subcontractors are to reduce payroll taxes, insurance premiums and benefit costs.
What Should a Subcontractor Do if They Believe They Have Been Misclassified?
Subcontractors who are injured on the job should not assume they are automatically excluded from workers’ compensation benefits simply because they have been referred to as an independent contractor. How one is paid or titled as a contractor is not the sole determining factor.
A trusted workers’ compensation attorney who understands the ins and outs of Illinois law can help navigate this complex process. Understanding your classification status can be critical to protecting your rights and recovering the benefits you deserve.
At Black & Jones, we’ve spent decades helping injured workers throughout Winnebago County and surrounding counties secure workers’ compensation benefits. If you’ve been injured at work, contact the experienced team at Black & Jones today at (815) 967-9000 or fill out our online form to schedule a free consultation.