Do You Need to Provide Workers’ Compensation Insurance for Contract Employees?

As a business owner, you have likely considered all the benefits of hiring both contract workers and employees alike. But do you know which types of workers are covered through your basic workers’ compensation insurance program?

Defining Contract Workers

Even though they are not considered to be officially part of the company itself, contract employees may need to be covered by workers’ compensation. It all comes down to how you define and classify these workers.

Normally, contractors are obligated to provide their own workers’ comp insurance coverage. But if an individual is hired as a contract worker and your business is in direct control over that employee’s activities, then the company may be liable to cover any workers’ comp claims. It is always best to speak with an insurance specialist when attempting to classify which types of workers can be considered employees.

Defining Employees

All those who work on your regular payroll – those whose paychecks reflect taxes and other important income deductions – are to be considered regular full- or part-time employees. These individuals are gainfully employed by your business in order to fulfill certain roles within the company.

In these situations, workers’ compensation insurance is always required in order to make sure that these employees are covered in the event of a workplace accident or injury.


Whether your company is responsibly for providing workers’ compensation insurance for contract employees ultimately depends upon how those workers are classified within the workplace.