As an appellate court stated: “The fundamental policy underlying the workers’ compensation laws is that those hiring others to perform services should bear the risk of injuries incurred in the undertakings. When the person seeks to hire the services through a licensed independent contractor, it is reasonable to anticipate that the independent contractor will insure against the risk and that the cost of the insurance will be passed on as part of the price of the contract. Thus, it is reasonable to exonerate the hirer of the independent contractor: however, when the person performing services for which a license is required is unlicensed, the likelihood that he will insure against the risk of injury and has included the insurance cost in the price of his contract is greatly reduced.”
The hypothetical gutter cleaner may or may not be covered under the workers’ compensation system, depending on the number of hours they have worked for you. Under Labor Code sections 3351(d) and 3352(h), if they have worked for more than 52 hours in the past 90 days, then they may legally be considered your employee and you may be responsible for providing them benefits as outlined under the workers’ compensation system.
Insurance Code Section 11590 requires comprehensive personal liability insurance policies (homeowners policies) to contain a provision for workers’ compensation insurance for any person so defined as an employee. If the person is not legally your employee, you would only be held liable if you had been negligent, such as by providing the worker with a defective ladder; providing negligent instruction, failing to disclose rotten gutters, etc.
If you employ someone who is required to have a license to perform services, and that person does not have workers’ compensation insurance and a worker gets hurt, pursuant to Labor Code Section 2750.5 you too are their employer for all intents and purposes. Therefore, you would be liable for the worker’s injuries under tort law, potentially without the benefits of the damages limitations of the workers’ compensation system.
If the company you hire has the proper insurance, you are not directing the work and are allowing them to be truly an independent contractor; then you are not liable. So, do two things: 1) Check to make sure the workers you contract with have workers’ compensation insurance; and 2) Make sure that you have comprehensive insurance that provides you coverage from any liability.
Christopher B. Dolan is owner of the Dolan Law Firm. Email questions to firstname.lastname@example.org.