Have you suffered an injury while working as an independent contractor and are wondering whether you are entitled to workers’ compensation benefits?
I was recently approached by a family friend who asked whether independent contractors are entitled to workers’ compensation benefits. They asked the question because they were worried about what might happen if they were injured at work.
It is not uncommon for employers to engage workers’ as ‘independent contractors’ rather than employees. However, the distinction between whether someone is an employee – or a contractor – is a crucial one when it comes to their entitlement to workers’ compensation benefits. This difference can have detrimental consequences to an individual if they are unfortunate enough to suffer an injury at work. Especially so if they need to take time off work and require ongoing medical treatment for their injury.
Generally speaking, independent contractors are not entitled to workers compensation benefits when they suffer an injury while performing their work. In contrast, all employers in Queensland are legally obliged to have workers’ compensation insurance for their employees. Usually, this policy is with WorkCover Queensland. This means employees are covered for lost wages and medical costs if they suffer an injury in the course of their employment.
So how can you tell if you are eligible for workers’ compensation benefits?
In Queensland, to be eligible for workers’ compensation benefits, a person needs to fall within the meaning of a ‘worker’ as defined in the Workers’ Compensation and Rehabilitation Act 2003 (Qld) (“the Act”). The Act defines a worker as someone who:
- works under a contract; and
- in relation to the work, is an employee for the purpose of assessment for PAYG withholding.
In addition, there are certain situations where contractors could fall within the definition of a ‘worker’ and may be eligible for workers’ compensation benefits. To determine whether you are entitled to workers’ compensation benefits, the rights and obligations that arise from the contract between you and your employer need to be considered as a whole, together with the working arrangement. It is important to remember that a contract can be formed in writing, orally, or it can be implied.
There are several factors that are taken into consideration when determining the nature of the relationship. These factors include whether you provide services as a part of a business, the method of payment, provision of tools or equipment, ability to delegate work duties, and whether you work exclusively for one company.
If you are providing services as part of your business and you are – paid to achieve a specific result or outcome, supply your own tools and equipment, and are liable for the costs of rectifying any defect in work – it is likely that you would not fall within the meaning of a ‘worker’ under the Act.
Alternatively, if you are paid for the time worked, you work exclusively for one company, you cannot determine your own working hours, and you are not required to supply your own tools and equipment, you may very well be entitled to workers’ compensation if you suffer a work-related injury.
What to do next if you have suffered an injury at work?
To receive compensation for your work-related injuries, the process starts by lodging an Application for Compensation with WorkCover. Usually, this must be lodged within 6 months of the date of injury. If you are unsure of your entitlement for compensation, you can still lodge the application for compensation. Even if the application is rejected, it can be reviewed. However, if you find yourself in a situation where WorkCover has, for one reason or another, rejected your application, it is crucial that you seek legal advice immediately to assist with the process as strict timeframes can apply.
All is not lost.
Even if it turns out that you are not entitled to workers’ compensation benefits, all is not lost. You may be entitled to pursue a claim for damages under the Personal Injuries Proceedings Act 2002 (Qld) if you can establish that the entity that engaged your services, negligently caused your injuries. In fact, such a claim could turn out to be more advantageous for you as it may allow access to greater damages and a potential entitlement to recover a portion of your legal cost.
If you are unsure of your entitlements to workers’ compensation benefits or your entitlement to pursue a claim for personal injuries, read our FAQs and get in touch with our team.
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