Oklahoma employers have often found themselves scratching their heads as to whether Workers’ Compensation requirements under the Administrative Workers’ Compensation Act (AWCA), apply to their businesses. Which labor categories are not included under this law? According to the Workers’ Compensation Commission’s guide for employers, there are a few categories of people who cannot claim compensation. Let’s go through them all.
Small family businesses may not have a legal obligation to obtain workers’ compensation insurance coverage if the business has five or fewer employees, all of whom are related to the employer. For this exception to apply, however, the employer must be an actual human being, a general limited partnership, or an incorporator of a corporation, if that corporation is the employer.
Partners of a Limited Liability Company who own 10% of its capital, at least, as well as stockholder-employees of a corporation within which they hold at least 10% of that corporation, are not deemed as “employees” by the AWCA.
Sole proprietors are not deemed “employees”, as they cannot be obligated to secure compensation coverage on themselves by law. Of course, sole proprietors may elect to get an insurance policy that covers AWCA benefits.
In terms of agricultural and horticultural employees, the exclusion is a little more nuanced. Where an employer in this sector has an annual gross payroll of less than $100,000.00, those employees are not deemed to be employees in terms of workers’ compensation law.
Finally, independent contractors are not deemed to be employees for compensation purposes. This distinction is complex, and depends on legal factors to determine whether a worker is an independent contractor or an employee. These factors, in general, include the following:
- The nature of the contract
- The degree of control exercised by the principal over the work done by the worker
- The nature of the worker’s business, and whether he or she does work for other principles
- The nature of the occupation and degree of supervision required
- The skill required to do the work, which may indicate the worker is indeed a contractor
- Whether the worker supplies his or her own materials for the work
- The length or duration of the work being done, i.e. whether the work is a one-off job, or is recurring
- Whether or not the work being done is a regular part of the business of the principal
- Whether the parties believe that there is a “master-servant” relationship in effect
- The right of either party to terminate the working relationship without liability
If you have been denied Workers’ Compensation benefits, contact the attorneys at Armstrong and Vaught, P.L.C. to arrange a consultation. Reach us at (918) 582-2500 or toll free at (800) 722-8880, or contact us online.