EMPLOYEE VERSUS INDEPENDENT CONTRACTOR UNDER IOWA WORKERS’ COMPENSATION LAW

 

Under Iowa law, employees are entitled to receive workers compensation benefits and independent contractors are not entitled to receive workers compensation benefits.  Corbin v. Pro-Platinum Construction & Remodeling, LLC. and Le Mars Insurance Company is an April 6, 2020 Appeal Decision from the Iowa Workers Compensation Commissioner analyzing a dispute on whether an injured worker was an employee or an independent contractor.  The Commissioner affirmed the decision of the Deputy Commissioner who noted that there are many legitimate independent contract relationships in the workforce, but that in the Corbin case the employer had been trying to evade his responsibilities to provide workers compensation insurance by using false independent contractor agreements.

Under Iowa workers compensation law there are 8 main factors that are examined to determine whether an injured Claimant is a worker or an independent contractor.  I am going to review the 8 factors and discuss the applicable underlying facts in the Corbin case.

1. The existence of a contract for the performance by a person of a certain piece or kind of work at a fixed price.  There was an allegedly independent contractor agreement contract, but it provided that the Claimant would be paid at the rate of $12.00 per hour. The Claimant was not bidding on the work or doing the work in an independent manner.  This factor supports the Claimant being an employee and not an independent contractor.

2. The independent nature of the worker’s business or of his distinct calling.  The owner of Pro-Platinum described the Claimant as performing “grunt” work.  The work primarily involved setting up new mobile homes or demolishing old mobile homes.  The Claimant had no prior skills or training in this area.  This factor support the Claimant being an employee and not an independent contractor.

3.  The Claimant’s employment of assistants and the Claimant’s right to supervisor activities.  The Claimant was only paid $12.00 an hour and he did not have the ability to hire any assistants.  This factor supports the Claimant being an employee and not an independent contractor.

4.  The Claimant’s obligation to furnish necessary tools, supplies and materials.  The Claimant did provide his own toolbelt and a hammer and pliers.  Pro-Platinum provided trucks, skid loaders and a TRANS Lift which is used to move mobile homes.  Claimant was provided with a credit card in the name of Pro-Platinum to buy supplies for jobs.  This factor supports the Claimant being an employee and not an independent contractor.

5.  The Claimant’s right to control the progress of the work, except as to final results.  The Claimant had no such control over the progress of any work.  The Claimant was given detailed instructions every morning on what he was supposed to accomplish every day.  This factor supports the Claimant being an employee and not an independent contractor

6.  The time for which the Claimant was employed.  The Claimant was employed by Pro-Platinum from July 18, 2016 until his date of injury of May 31, 2017.  The Claimant did not work for anyone else during this time.  This factor supports the Claimant being an employee and not an independent contractor.

7.  Whether the Claimant was paid by time or by job.  A worker who was paid a flat amount for a specific job has a better chance of being found to be an independent contractor.  However, the Claimant was paid by the hour.  This factor supports Claimant being an employee and not an independent contractor.

8.  Whether the work performed by the Claimant is part of the regular business of the alleged employer.  Pro-Platinum’s business was installing new mobile homes and demolishing old mobile homes.  If the Claimant had been hired to clean the offices of Pro-Platinum, there would be a better chance of a finding that he was an independent contractor. However, the Claimant was involved in the regular mobile home business of Pro-Platinum.  This factor supports the Claimant being an employee and not an independent contractor.

The Commissioner accordingly ruled that the Claimant was an employee and was entitled to workers compensation benefits.

The Claimant had suffered a broken leg that fortunately healed well.  The Defendants were ordered to pay the Claimant 30 weeks of healing period benefits and 26.4 weeks of permanent partial disability benefits.  The Defendants were also ordered to pay all of the Claimant’s medical bills related to the leg injury.