Under Texas work injury law, employees and independent contractors have very different rights.
In this article, we're going to discuss the difference between the right to sue that an independent contractor has when they are hurt on the job and the right to sue that a bona fide employee has when they are hurt on the job.
While at first blush this may seem like a simple enough topic to cover, there are a few tricky aspects that we need to cover first so that we can lay a foundation for the discussion:
First and foremost, everything we discuss on this page is related to Texas non-subscriber work injury law, that is to say, we're talking about the rights of injured workers whose employers DO NOT participate in a Texas workers' comp plan. So, if your employer has workers' compensation coverage, none of what we discuss on this page will relate to you, and you should instead visit our workers' compensation overview page.
Second, it needs to be understood that when a worker is hurt on the job while working for a company that does not subscribe to a workers' comp plan, that can actually be good news for the injured worker. You see, workers' comp is a benefit system that pays rather insignificant compensation to injured workers. The advantage of the workers' comp system for injured workers is that the benefits they receive are mostly paid without incident. Workers' comp is a no-fault system, so they don't have to engage in a protracted court battle with their employer in order to get paid. The downside for injured workers is that even if they want to sue their employer, they can't. The law takes that right away from workers who employers opt in to the workers' comp system.
But for workers whose employers are non-subscribers, the right to sue the employer stays intact. While this certainly breeds conflict and generally makes it more difficult for the injured worker to get paid, it also affords them the opportunity to obtain far more compensation that they ever could with a workers' comp claim.
Third, even though both independent contractors and genuine employees can sue their non-subscriber employer, the way that the case works and what each type of worker has to prove are considerably different. And therein lies the rub. It's easier for a negligent company to avoid paying fair compensation to an independent contractor than it is for them to avoid paying an injured employee.
As such, many employers mis-categorize their workers as contractors, and therein lies the controversy that spawned this article.
Questions Answered on This Page:
- How is my work injury case impacted if I'm a contract worker?
- Does a work injury case change if I'm an employee versus a contract worker?
- How does my my employee status impact my Texas work injury case?
The difference between contractors and employees.
A contractor is someone who provides their services to multiple companies or individuals, owns their own equipment, pays their own taxes, provides their own training and supervision, decides when they take breaks, and can typically lose a single customer without it upending their entire business. They are, for all intents and purposes, in charge of their own business. An example would be the guy that Walmart uses to trim their hedges. He also trims hedges for other companies in the area. Another might be the handyman you hire to install a light in your house. He's not your employee; he's an independent contract.
By contrast, an employee typically works for a single company, what they do and how they do it are dictated by a supervisor or company policy, they're typically provided by their employer with tools, training, and supervision, they're told when to come to work, the employer pays part of their payroll taxes, they're typically provided with benefits, and so on.
Next, we'll cover why this matters.