Your Workers’ Compensation Eligibility if Injured While Working for an Outsourcing Agency

By Margaret Worlidge posted Sun March 14,2021 03:38 PM


When working for an outsourcing agency, you may often not be sure whether you are employed full-time or just operating as an independent contractor. Most importantly, that uncertainty can lead you to start questioning if you are covered by the workers’ compensation should you have an accident at work.

The most obvious sounding answer to those fears might be revising your contract with the agency but unfortunately, what you are on paper could be different from reality. To know if you’re eligible for workers’ compensation, you need to see how the Internal Revenue Service (IRS) taxes you.

How you do your work

When determining whether you’re an independent contractor or not in the outsourcing agency you work for, the IRS looks at how you are managed. If you’re given detailed instructions, tools and don’t work under an evaluation system based on end results, the IRS will tax you as an employee.

If you’re taxed as an employee, you must enjoy all the benefits of being one. If the outsourcing agency refuses you worker’s compensation, even if you’re taxed as an employee, you’ll need Stephen Babcock Attorney services to file a personal injury claim. Stephen Babcock is a master litigator and ranks the best personal injury attorney in Baton Rouge, Louisiana.

Cash flow

Another big determiner that the IRS uses to separate legitimate independent contractors from employees is looking at an individual’s cash flow and scrutinizing the details. If an independent contractor earns a wage that doesn’t vary a lot and is paid at regular intervals such as monthly, biweekly and weekly, things get different.

Independent contractors are usually paid a flat sum for a job done and unlike employees, they stand to make a loss at certain points in their careers. Independent contractors also have to keep offering their services to the open market as they aren’t permanently employed wherever they work.

Working relationship

As we’ve seen, a contract that says “independent contractor” or “employee” isn’t sufficient to determine the nature of your working relationship with your outsourcing agency. So what you have to look out for with how the agency interacts with you is if they offer you benefits businesses normally offer their employees. 

If you get a pension plan, sick pay, or insurance, your agency is not treating you like an independent contractor, so you could be eligible for workers’ compensation. If you really aren’t sure about your employment status, you will need to contact a lawyer to avoid further confusing yourself and possibly the agency.

Pay for yourself

If you’re already injured, you will have to file a personal injury claim if you work on an independent contractor basis at your agency. To ensure that you’re eligible for it should you get injured again, you will have to pay for it separately, as some form of insurance.

In fact, in the future, the agency you work for might get a contract for you that’ll require you to have your own workers’ compensation. This will also put you in a more favorable position compared to other independent contractors as companies will prefer working with someone who is less of a liability.

It’s yours

Once you’ve ensured that you have workers’ compensation either through your outsourcing agency or on your own, you can rest assured that you’re covered. Unlike some insurance policies, your workers’ compensation benefits won’t get released only if you didn’t cause the accident that injured you. 

The only provision that applies in whether you’re eligible to get your workers’ compensation benefits if you have one is workplace-related injury. The benefits you’ll be eligible for upon injury include subsidized medical treatment, weekly compensation, and permanent impairment benefits.

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