Only W2 employees are covered under workers’ compensation in Nevada. Most independent contractors are not considered employees. Therefore, independent contractors are generally not entitled to workers’ compensation benefits.
Specifically, all relationships in the construction industry are considered employer-employee relationships even if they are called independent contractor relationships.
To be a true independent contractor and not covered by workers’ compensation insurance it must be shown that:
- the work is not in the construction industry, and
- the alleged employer can show the independent contractor has an independent enterprise.
To be an independent enterprise, the person must:
- not be in the same trade, business, profession or occupation as the employer, and
- present himself or herself as being engaged in a separate business
and one of the following:
- hold a business or occupational license in his or her own name; or
- own, rent, or lease property used in furtherance of the business
An independent contractor misclassified as an employee in Nevada qualifies for all workers’ compensation benefits. Those benefits can be obtained through the employer or through special rules for uninsured employers.
In this article, our Nevada worker’s comp attorneys will explain:
- 1. Independent contractors are likely to be employees in Nevada
- 2. Independent contractors and construction work
- 3. To be an independent contractor one must have an independent enterprise
- 4. Independent contractors and workers’ compensation insurance
- 5. Employers may falsely try to classify an injured worker as an independent contractor
Most independent contractors are considered employees under Nevada workers’ compensation laws
1. Independent contractors are likely to be employees in Nevada
The general rule in Nevada is that an independent contractor is likely considered an employee under the workers’ compensation laws.
1.1. Employee of a principal contractor
Independent contractors and subcontractors of a principal contractor are deemed to be employees.1 2 Therefore the contractor is covered by the principal contractor’s workers’ compensation insurance.
Principal contractor means a person who:
- coordinates all the work on an entire project;
- contracts to complete an entire project;
- contracts for the services of any subcontractor or independent contractor; or
- is responsible for payment to any contracted subcontractors or independent contractors.
If the principal contractor does not have insurance, the principal contractor is an uninsured employer, and the injured worker can proceed according to the uninsured employer rules.
Example: Jake owns a landscaping company. He hires several independent contractors to assist with the work.
Jake must have workers’ compensation insurance because he is the principal contractor. He coordinates the entire job and is responsible for receiving and distributing payments.
For the sake of Nevada workers’ compensation, the independent contractors are Jake’s employees and can claim workers’ compensation benefits if they are injured.
2. Independent contractors and construction work
A person who works as a contractor in the construction industry, except for registered architects and licensed engineers,3 cannot be an independent contractor. The independent enterprise test, described below, does not apply to the construction industry.4
Example: Victoria is an electrician. She does work on a new office building and injures her wrist.
Victoria can claim a work injury against the principal contractor that hired her to do the work. The independent enterprise test does not apply because the work is in the construction industry.
3. To be an independent contractor, one must have an independent enterprise
Independent contractor means any person who:
- renders service for a specified amount
- for a specified result
- is responsible for the way the work is done5
An independent contractor is not an employee if he or she:
- not in the same trade, business, profession or occupation as the employer
- presents himself or herself out as being engaged in a separate business
and one of the following:
- holds a business or occupational license in his or her own name; or
- owns, rents, or leases property used in furtherance of the business6
Example: Henry is an independent contractor truck driver working with a delivery logistics company. He injures his knee and back while making a delivery.
Henry holds himself out as a separate business and owns his own trucks, but he is in the same trade or business as the logistics company.
Henry is therefore considered an employee and is entitled to workers’ compensation benefits from the logistics company.7
As stated above, this does not apply to the construction industry, where every independent contractor is considered an employee.
4. Independent contractors and workers’ compensation insurance
A Nevada employer must have insurance for all of its employees. Employers in Nevada without workers compensation coverage face civil and even criminal liability. An employee means every person in the service of an employer, whether lawfully or unlawfully employed.8
The question in each case is whether the worker is an employee and covered by workers’ compensation laws or an independent contractor and not covered.
An easier claim to benefits as an employee
An employee does not have to prove the employer did anything wrong to file a claim for worker’s compensation benefits.
An independent contractor is not an employee and therefore not covered by workers’ compensation insurance. Unlike an employee, an independent contractor must prove the employer did something wrong to win in court.
It is harder to win benefits if a worker is not covered by workers’ compensation insurance.
4.1. Filing a claim as an independent contractor
Information for an independent contractor and his or her possible employer is available from the Nevada Division of Industrial Relations.
An independent contractor should file a claim for workers’ compensation benefits. The issue as to whether the worker is covered by workers’ compensation laws can be resolved after the claim is filed.
Filing the claim entitles the injured worker to claim medical treatment, temporary disability, permanent disability, death benefits, vocational rehabilitation, and mileage reimbursement.
5. Employers may falsely try to classify an injured worker as an independent contractor
Employers that do not want to pay for workers’ compensation insurance or benefits may try to convince an injured employee that he or she is an independent contractor.
Employees should not trust an employer that tries to use the independent contractor argument and should pursue Nevada workers’ compensation benefits.
Call us for help…
If you or someone you care about was injured at work in Nevada, our Las Vegas workers’ compensation attorneys may be able to get you compensation. (For cases in California, please see our page on independent contractors and workers’ compensation in California.)
For a free consultation to discuss your case simply fill out the form below or call us.
See our related article, Nevada Work Injury Laws – 4 That You Should Know.
Legal References:
- Nev. Rev. Stat. § 616A.210
- Nev. Rev. Stat. § 616A.320
- Nev. Rev. Stat. § 624.020
- Nev. Rev. Stat. § 616B.603(3)(a)
- Nev. Rev. Stat. § 616A.255
- Nev. Rev. Stat. § 616B.603
- Hays Home Delivery v. Emplrs Ins. Co. (2001) 117 Nev. 678, 31 P.3d 367.
- Nev. Rev. Stat. § 616A.105