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workers comp claim illustration

What Counts as a Workers Compensation Claim?

If any of your employees suffer a work-related injury, workers compensation is designed to pay for medical care and lost wages, among other potential costs. While this may sound simple and straightforward, the situation is a bit more complicated, especially when taking into consideration the location of your business.

Differences in what constitutes a work-related injury and what types of workers are covered can often lead to confusion and unpleasant gaps in coverage. To help you avoid this, let’s dig deeper into what would count as an appropriate workers compensation claim based on your industry and geographical location.

What Will a Workers Compensation Policy Cover?

First and foremost, workers compensation laws differ by state.  Also, not all states manage workers’ compensation in the same way:

  1. There are Monopolistic states (North Dakota, Ohio, Washington and Wyoming) where the state provides employers with the insurance policy; and
  2. All other states, including the District of Columbia, which look to insurance companies to provide the coverage.

Where they tend to agree, is that for an injury to be considered work-related, it has to happen while the employee is carrying out a task for the employer or during employment – this is often referred to as a “course and scope” test. Typically these are the injuries that occur at the workplace. If an employee is injured while on lunch break, the injury could be covered by workers comp if it happens on the employer’s property, or is connected to the course of employment (for example, a business lunch in a restaurant).

However, even if the employee is injured at a different location, the injury can be considered a work-related as long as it happens while they are acting on behalf of the employer. According to Larson’s Workers’ Compensation, Desk Edition, there areHowever, employees requesting workers comp have successfully argued that they are attending these events at the request and for the benefit of their employer. Larson’s Workers’ Compensation Law, a law book cited by courts in workers’ comp cases in all U.S. states, outlines three key facts that determine whether workers comp will cover recreational activities:

  1. whether the employer expressly or impliedly requires participation;
  2. whether the employer derives a benefit from the employee’s involvement beyond the employee’s health and morale,; and
  3. whether the activities occur on the employer’s premises during lunch or a recreation period as a regular incident of employment.

So, while workers compensation policies exclude intentional injury, in some cases recreational activities such as team-building events or office parties could be compensable if employees are not permitted to opt-out of participating. 

workers compensation illustration

Who Will Workers Compensation Cover?

We’ve addressed the fact that most employers must carry worker’s comp for their employees. But what constitutes an “employee” from the standpoint of insurance?

While this varies from state to state, the IRS classifies someone as an employee as follows:

In general, anyone who performs services for an organization is an employee if the organization can control what that person will be doing and how their tasks will be performed. The factors that designate someone as an employee are:

  • A specific salary
  • An existing verbal or written contract
  • The employer controls the work they perform

Again, state laws ultimately define “employee” under workers’ compensation.  What this means in practice is that in many states, domestic, agricultural, seasonal workers, and undocumented workers won’t be covered by their employer’s workers comp policy without specific endorsement. Other employee types, for example those working on docks, harbors, military bases, or vessels, require specific endorsements to ensure coverage under the policy.

Additionally, federal employees are covered under federal programs (such as FELA) and aren’t subject to their state’s programs. 

Let’s breakdown what types of workers aren’t typically covered on a standard, unendorsed state-by-state basis.  This may be because they are considered covered elsewhere (e.g. homeowner’s policy, specific state program, etc.) or may not meet the state’s definition of “employee” (such as independent contractors):

Alabama
Alabama:
-Domestic servants
– Farm laborers
– Casual employees
– Those working for a business with fewer than five people
– Licensed real estate brokers
– Product demonstrators

Alaska
Alaska:
– Part-time babysitters
– Domestic servants
– Harvest and similar non-permanent help
– Contracted entertainers
– Statutorily-defined taxi cab drivers
– Statutorily-defined commercial fishermen

Arizona
Arizona:
– Casual employees
– Domestic servants
– Independent contractors

Arkansas
Arkansas:
– Agricultural farm laborers
– State employees
– Casual employees
– Inmates

California
California:
– Domestic employees employed by family members
– Deputy sheriffs or clerks
– Anyone performing services in return for aid or sustenance only
– Anyone officiating amateur sporting events
– Volunteers at non-profit recreational camps

Colorado
Colorado:
– Inmates
– Volunteers
– Drivers under a lease agreement with a common carrier

Connecticut
Connecticut:
– Sole proprietors
– Business partners
– Independent contractors
– Casual employees

Delaware
Delaware:
– A spouse and minor children of a farm employer not named in an endorsement to the farm employer’s contract of insurance
– Casual employees

District of Columbia
District of Columbia:
– Employees whose employer is an uninsured subcontractor can assert a claim against the general contractor

Florida
Florida:
– Independent contractors NOT in the construction industry
– Licensed real estate brokers
– Musicians and theatrical performers
– Causal employees,
– Volunteers (most)
– Some Vehicle-for-hire drivers
– Some sports officials

Georgia
Georgia:
– Railroad workers engaged in interstate or intrastate commerce
– Farm laborers
– Domestic servants
– Licensed real estate salespeople or associate brokers
– Independent contractors

Hawaii
Hawaii:
– Almost none (a few exceptions for primary and secondary contractors)

Idaho
Idaho:
– Domestic servants
– Casual workers
– Pilots flying in agriculture
– Real estate brokers and real estate salesmen
– Volunteer ski patrollers
– Officials secondary school sports events

Illinois
Illinois:
– Real estate brokers
– Farmers
– Jurors

Indiana
Indiana:
– Railroad workers
– Employees of fire or police departments
– Casual laborers
– Farm or agricultural employees
– Household employees

Iowa
Iowa:
– Household employees earning less than $1,500 during 12 months before an injury
– Casual employees earning less than $1,500 during 12 months before an injury
– Agricultural employees where the employer’s nonexempt cash payroll is less than $2,500 for the preceding calendar year
– Relatives of farm employer and employer’s spouse
– Some corporate officers

Kansas
Kansas:
– None

Kentucky
Kentucky:
– Domestic servants, if there are less than two regularly employed in a private home for 40 hours or less per week
– Maintenance, repair and similar employees employed in a private home

Louisiana
Louisiana:
– Household employees and workers of private unincorporated farms
– Musicians and performers

Maine
Maine:
– Independent contractors
– Maritime employees covered under admiralty law
– Certain agricultural workers

Maryland
Maryland:
– Independent contractors

Massachusetts
Massachusetts:
– Workers on vessels engaged in interstate or foreign commerce
– Those working in organized, professional athletics
– Real estate brokers
– Commission only salespeople
– Persons employed by an employer engaged in interstate or international commerce
– Casual workers

Michigan
Michigan:
– Smaller employers
– Some agricultural employees and domestic workers
– Real estate brokers

Minnesota
Minnesota:
– Farmers or their families who exchange work with other farmers

Mississippi
Mississippi:
– Independent contractors

Missouri
Missouri:
– Leased truck operators in interstate commerce
– Farm workers
– Domestic servants
– Family chauffeurs
– Licensed real estate agents
– Inmates
– Volunteers
– Sports officials

Montana
Montana:
– Domestic servants
– Casual workers
– Dependent member of the employer’s family
– Sole proprietors
– Real estate brokers
– Certain officials at athletic events
– Freelance photographers and authors
– Newspaper carriers
– Cosmetologist or barbers
– Jockeys
– Ordained ministers
– Officer or manager of a ditch company
– Persons working for enrolled tribal members who operate solely within the boundaries reservations
– Petroleum land workers

Nebraska
Nebraska:
– Domestic servants
– Agricultural employees
– Railroad workers employed by companies engaged in interstate or foreign commerce

Nevada
Nevada:
– Casual employees
– Theatrical or stager performers
– Musicians whose services do not last more than two consecutive days
– Domestic workers
– Voluntary ski patrol
– Sports officials paid a nominal fee
– Any member of the clergy
– Real estate brokers
– Direct salespersons working on commission

New Hampshire
New Hampshire:
– Railroad workers engaged in interstate commerce
– Direct sellers
– Real estate brokers and appraisers
– Service providers for individuals with developmental, acquired, or emotional disabilities

New Jersey
New Jersey:
– Independent contractors
– Domestic workers
– A willfully negligent employee
– Inmates
– Casual workers

New Mexico
New Mexico:
– Farmworkers
– Domestic servants
– Real estate agents
– Anyone who waves their coverage

New York State
New York State:
– Domestic employees working less than 40 hours per week
– Clergymen
– Employees of municipalities not engaged in hazardous employment
– Sanitation workers, firefighters and police officers in the employment of the City of New York
– Babysitters and minors over the age of 14 engaged in casual employment
– Longshoremen and harbor workers
– Railroad employees

North Carolina
North Carolina:
– Casual workers
– Independent contractors
– Anyone engaged in an illegal enterprise
– Real estate broker and agents
– Board members
– Newspaper deliveries

 

North Dakota

North Dakota:
-Owner, partner, corporate officer or spouse
-Employer’s children under the age of 22
-Certain licensed real estate brokers
Newspaper delivery personnel
-Farm and ranch labor
-Certain custom farm operations
-Household domestic workers
-Employees engaged in the operation of a place of worship
-Federal and railroad employees

 

Ohio
Ohio (Monopolistic):
– None

Oklahoma
Oklahoma:
– Horticulture workers not using motorized machines
– Licensed real estate brokers
– Medical care or social services employees
– Employers with less than five employees if they are all related by blood or marriage
– Youth league employees if they are tax exempt
– Sole proprietors
– Volunteers
– Domestic servants
– Leased truck and tractor-trailer operators

Oregon
Oregon:
– Inmates or wards of a state institution
– Casual employees

Pennsylvania
Pennsylvania:
– Casual employees

Rhode Island
Rhode Island:
– Employees of the state
– Casual employees
– Farmers and farm laborers
– Nursery workers
– Real estate brokers
– Salespeople

South Carolina
South Carolina:
– Casual employees

South Dakota
South Dakota:
– Volunteers
– Independent contractors
– Domestic servants working less than 20 hours per week
– Farm laborers

Tennessee
Tennessee:
– Undocumented workers

Texas
Texas:
– Independent contractors
– Federal employees

Utah
Utah:
– Real estate agents and brokers

Vermont
Vermont:
– Casual employees
– Amateur sportsman
– Agricultural employees for an employer with an aggregate payroll of less than $10,000 per year
– Family members living in the employer’s house
– Those engaged in service about a private dwelling
– Sole proprietors
– Real estate brokers or salespeople
– Certain members of a corporation or LLC Independent contractors
– Assistant judges
– Illegally hired minors

Virginia
Virginia:
– Employees who are not employed within the usual course of the employer’s business

Washington
Washington (Monopolistic):
– Workers for businesses registered within the Registration of Contractors
– Licensed electricians
– Domestic servants
– Home gardening and maintenance workers
– Workers performing services in return for aid or sustenance
– Sole proprietors or partners
– Minors employed by parents in agriculture
– Jockeys
– Corporate officers
– Entertainers
– Newspaper deliveries

West Virginia
West Virginia:
– Domestic servants
– Agricultural employers of fewer than six full-time employees
– Church workers
– Casual employees
– Employees engaged in organized, professional sports activities
– Volunteer rescue or police
– Federal employees

Wisconsin
Wisconsin:
– Domestic servants
– Most volunteers

Wyoming
Wyoming (Monopolistic):
– Casual employees
– Sole proprietors
– Corporate officers
– Independent contractors
– Professional athletes
– Federal government employees
– Elected officials
– Volunteers Members of LLCs
– Foster parents
– State childcare workers

The Takeaway

In most cases and states, a worker will be afforded workers compensation benefits if they are an employee of the business and get hurt during their employment. If you have any questions or need more guidance on your specific situation, the best thing to do would be to chat with one of our expert brokers.