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Improperly Classified Independent Contractors and Workers’ Compensation

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Archive: Jul 2015

Improperly Classified Independent Contractors and Workers’ Compensation

Sometimes the line between who is considered an employee and who is an independent contractor gets blurred. Many companies prefer to classify workers as independent contractors to avoid paying for workers’ benefits and insurance. Failing to properly classify workers, however, can come with severe consequences. Popular questions about worker classification and injury claims include:

What Do I Do if I am Improperly Classified as an Independent Contractor and I get hurt?

There is not a specific description for an independent contractor, making them very hard to define. Instead, court interpretation and law enforcement decide who is really an independent contractor when injury and other claims arise. Generally speaking, an employee is a worker who:

  • Is behaviorally controlled by the company. Any worker who follows company protocols for when and where to work, how to work, or who the worker can collaborate with may be considered an employee. Workers trained or evaluated on performance may also be considered employees.
  • Relies on the company for financial considerations. A company that supplies tools, equipment, and other requirements for a job likely has employees, not independent contractors.
  • Considers his or her work source a client, not an employer. An independent contractor will not receive benefits but will work according to a predetermined contract. He or she typically also provides services that are not a key part of the business.

If you have been injured and are concerned that you may have been misclassified, contact an attorney as soon as possible. With a quick, initial conversation, you may be able to determine whether you are truly an independent contractor or if you should be eligible for employee benefits like workers’ compensation.

Why Would My Employer Misclassify Me?

Occasionally, an employer will misclassify workers on accident. He or she may be new and naïve about state laws regarding employee classification. However, many claims against employers are based on “willful” misclassification. If an employer should have reasonably been able to classify you as an employee and failed to do so, he or she is in conflict with the current laws in California and may be subject to strict penalties.

An employer who willingly misclassifies an employee may be trying to cut corners and keep more profit away from workers. By having independent contractors rather than employees, a company can avoid paying certain taxes and labor costs. Companies that utilize independent contractors do not have to pay social security or unemployment insurance to independent contractors. It also frees employers from paying a minimum wage or following equal employment opportunity regulations.

What Penalties Are Involved? Which Laws Govern Them?

California has stiff penalties for any companies that misclassify their workers. Under Senate Bill 459, the state’s Labor and Workforce Development agency can fine employers for willfully misclassifying individuals $5,000-$15,000 for each violation. For any proven pattern of misclassification, the penalty may be increased to $25,000 for each violation. Any employer who is guilty of misclassification cannot deduct fees or other payments after a contractor has been reclassified.

Can I File a Claim if I Have Been Improperly Classified? How?

Yes, you can still file a claim if you have been improperly classified. First, you will need to challenge your status as an improperly classified worker. Under California law, you will need to file a wage and hour claim against the employer with the Division of Labor Standards Enforcement to recover lost payments and determine your true employment status.

You may want to consult an attorney for this process. The claim will be evaluated by the Deputy Labor Commissioner who will make a judgment call for proceeding with the case. Once your status as an employee has been determined, your attorney can help you complete the next steps in securing compensation in an injury claim.

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How Are Workers’ Compensation Benefits Calculated in California?

Every state approaches workers’ compensation differently. If you are injured on the job in California, understanding the payment structure can help you make decisions about your future. It can also alert you to unfair assessments by your employer or a claims adjuster. Increase your payout and get the benefits you deserve by understanding how benefits are calculated for a workers’ compensation settlement amount.

What You Are Entitled to Under Workers’ Compensation Insurance

After you have suffered an on-the-job injury, your employer should present you with paperwork for workers’ compensation within the first 24 hours. This benefits program from their insurance company will cover your medical expenses, rehabilitation, transportation to and from treatment, income replacement through temporary or permanent disability, and death benefits to surviving family members. A settlement offer can result in a payment plan or a lump sum.

The California Division of Workers Compensation (DWC) regularly holds seminars for those interested in learning more about coverage after a workplace injury, and the Department of Industrial Relations website is also a great resource for questions you have about compensation.

Calculating the Medical Benefits

The benefits you receive through a workers’ comp settlement is for your medical bills. Workplace injuries are completely covered by the policy. You will not pay a deductible or other out-of-pockets costs. The coverage for curing or relieving the effects of the injury may include medication, hospital expenses, office visit bills, medical equipment, and physical therapy needs. You will be covered up to $10,000 in compensation until your comp claim has been accepted or denied.

Wage replacement costs are calculated according to the amount of time you spend away from work. You do not have to use personal time off to recover from your injury. If you miss 3 or more days or you are hospitalized overnight, you will be entitled to receive temporary disability, which will cover 2/3 of your weekly income. If you suffer from an injury that permanently reduces your earning capacity, you may be entitled to receiving extended benefits through a permanent disability program.

Permanent disability is calculated based on the extent of your injury, the date, and other factors. In addition to wage replacement benefits, you may also be entitled to an SJDB (Supplemental Job Displacement Benefits) voucher, which may include $6,000 in compensation for vocational retraining, skill training, and more.

During 2015, travel reimbursement for treatment is calculated at $.575 per mile. This benefit covers trips to the doctor, therapy, hospital visits, and to the pharmacy. Death benefits to surviving family members include $10,000 for burial, a range of compensation from $250,000-$320,000 for surviving dependents, and annual support capped at $250,000 for partial dependents.

Additional Considerations That Affect Compensation

Even reviewing benefits calculations online can be confusing. Your unique circumstances will govern how your benefits are calculated. For instance, you may disagree with your physician and need to get a second option that may completely change your compensation amount. Deadlines for filing paperwork can also affect your ability to receive maximum compensation.

What About Disability Benefits?

If your work injury restricts your ability to perform your work at the level you were able to before, you may be entitled to a permanent partial disability award.

Seeking Legal Counsel

While it is not always necessary to secure an attorney for workers’ compensation claims, every case is different. Labor laws in California are complex, and an attorney can help you understand your rights and advise you on legal action if you are concerned your physician, claims administrator, or employer is treating you unfairly. Workers’ compensation attorneys in California will never charge you directly for their services. Instead, they are paid through workers compensation benefits.

If you are interested in learning more, contact the Orange County workers comp attorneys at DiMarco | Araujo | Montevideo. We always offer a free consultation which may help you decide whether or not to take legal action. We can help you find competent medical treatment, maximize your compensation, and help you heal so you can move forward with your life.

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What to Do if You Are Not Ready to Return to Work But Your Employer Demands It?

If you’ve suffered a workplace injury, you may be unsure about what you are entitled to receive by law. During or after a worker’s compensation claim settlement, your employer may make demands you feel are unfair, like returning to work before you have recovered. Here is what you need to know about your rights during recovery.

Individuals Who Influence Your Recovery

After an injury, several parties impact whether you stay at home, return to work with limitations, or return to work full time. These include your doctor, employer, attorney, and claims administrator. Your insurance, level of injury, and any pending lawsuits all impact when you will be expected to go back to work.

For some, a severe injury may lead to a longer recovery period. In other cases, an employee may never be able to do the same kind of work again. Everyone heals differently, so it’s important to speak up to your physician and attorney about your current situation. They can help you talk to your employer and claims administrator so you aren’t forced to return to work sooner than necessary.

Steps You Can Take If You’re Not Ready to Return to Work

Good communication with those involved in your case is the key to fair treatment during recovery. Some employers and even claims administrators may try to unethically pressure you into returning to work before you have healed. If you are not ready, your physician and attorney can prove your injury status and help you talk to your employer and/or claims administrator.

In California, California Labor Code section 132a addresses discrimination against injured workers. If you reject an assignment based on your current abilities, it is unethical and illegal for an employer to threaten or take action against you. Talk with your attorney as soon as possible, because there are deadlines on taking legal action against your employer.

Can I Be Fired if I’m Not Ready to Return to Work?

There are limits to who can be fired after a workplace injury. If you cannot complete your normal scope of duties and there is no other job available at the company, your employer is not required to keep you on as an employee. Most workers’ compensation claims will offer vocational rehabilitation in these cases to help you make a transition into another job description.

It is always a good idea to seek the advice of your attorney throughout the recovery process. If your employer is discriminating against you or fails to offer you tasks that suit your current abilities, you may have grounds for a lawsuit.

Preventing Discrimination During the Recovery Phase

Recovery should be your primary goal after a workplace injury. Unfortunately, fear of employer response and the ability to work in the future often overshadow the recovery process. Be as proactive as possible during this time by maintaining clear lines of communication between all decision-making parties.

For instance, if you feel like you can return to work with restrictions, make sure you have a copy of your doctor’s written restrictions and that your employer understands your limitations. If you interact with your employer before seeking legal advice, try to use written correspondence to negotiate your return to work. Writing encourages employers to follow the rules and provides you with evidence in the event that they do not.

The advice of a workers’ compensation attorney can be invaluable throughout this complex process. The world of workplace injury often comes with tension between an employee and employer. You are not at the mercy of your employer. Get the compensation and recovery time you need to get back to your life, and contact DiMarco | Araujo | Montevideo today for more information.

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Workers’ Compensation for Psychological Injuries in California

Employees may be most familiar with workers’ compensation coverage for physical injury and illness in the workplace. Psychological injury, however, can also be eligible for coverage. Commonly called “stress claims,” psychological injuries may be associated with a workplace injury, or they may be entirely separated. Here is what you need to know about filing a claim for psychological injury in California:

What Psychological Injuries are Covered?

As part of a psychological injury claim, the claim must prove that:

  • The employee has a diagnosed medical condition that requires medical treatment or has caused disability.
  • The employee’s tenure at a job is at least 6 months, altogether.
  • The employee’s injuries were very likely caused by the environment at work.

These claims are typically more challenging to pursue because there may not be a physical manifestation that something is debilitating. Psychologically based claims are also challenging because a mental disorder may be caused by a number of different personal or professional factors. In California, an employee must make a case that at least 51% of the psychological consequences were caused by the work environment.

Documentation and Evidence Supporting Psychological Injury Claims

Evidence can make a case for a psychological injury very strong. Professional correspondence, professional psychological evaluation, and other supporting documentation can help prove a work environment was responsible for the mental difficulty.

Employers who are discriminatory, fail to uphold contract terms, fail to offer legal benefits, or otherwise behave in bad faith can be held responsible for any psychological injury resulting from the behavior. Conversely, an employer who has used the appropriate channels for criticism, promotion denial, or performance review cannot be held accountable through a psychological claim.

Proving a psychological injury claim can be a stressful process. The burden of proof lies with the claimant and may require extensive medical histories, financial history, and family history. Every part of an employee’s life will be scrutinized to determine the validity of the claim. A physician’s testimony, including details of the work environment, job satisfaction, and performance reviews may also be required. Extensive interviews with family members and other statements and records may also be part of the process.

Benefits for Psychological Injury Claims

Employees pursuing a mental injury claim may have a difficult time recovering permanent disability compensation. Often, the assumption is an employee will make a full recovery once removed from the mentally harmful environment. In some cases, claimants who can prove permanent consequences from the environment may be eligible for permanent disability benefits.

Dual Injury Claims

In some cases, psychological injury may accompany a physical injury. These cases may be easier to prove because of the association with a physical injury. Many chronic pain and long-term recovery processes can lead to depression, anxiety, and other mental disorders. The connected claim may lead to a higher benefit level for employees who have been both mentally and physically affected by a workplace injury.

Addressing Psychological Injury

If you have been suffering from workplace-related stress, don’t stay quiet. Your job should not cause excessive mental duress. Contact a licensed and certified psychologist or psychiatrist for help, and consider consulting an attorney about filing a psychological injury workers’ compensation claim. Depending on the circumstances, there may be a larger legal matter that needs to be addressed in the organization. Being discriminated against, taken advantage of, or verbally or physically abused is never acceptable.

An attorney at DiMarco | Araujo | Montevideo can help you determine if you can file a workers’ compensation claim for psychological injury. While some employees choose to file claims on their own, those dealing with injury may find the help of an attorney eases the stress associated with filing. Contact our office today for a free consultation with a workers comp lawyer in Orange County.

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