Q: Does our ministry's workers' compensation policy cover independent contractors? 

A: Generally speaking, a truly “independent” contractor will not be covered by your ministry’s workers’ compensation policy. However, consider the following case from Tennessee.

Independent Contractor or Employee: A Tennessee Court Decides

A church member and member of the planning Committee volunteered his time working on a building project for the church. When church leaders became concerned about the amount of time being donated by the church member, they decided to pay for the hours that the individual worked. The only control the church exerted over this individual was direction over the work actually being done, control of who worked on the job site, and a reservation of the right to terminate the working relationship at any time. After the worker fell from the roof and died from the injuries, the Tennessee courts determined that the man was an “employee” for purposes of workers’ compensation coverage.

Some states require independent contractors to register with the state. They assume all unregistered workers are employees. 

Independent Contractor or Employee?

The rule followed by the Tennessee court in reaching this conclusion is similar to those used by courts in other states. “Because the Workers’ Compensation Law must be rationally but liberally construed to promote and adhere to the Act’s purpose of securing benefits to those workers who fall within its coverage, this Court will resolve doubts in favor of a finding that a worker is an employee rather than an independent contractor.” Blake v. Auto-Owners Insurance Company, Case No. W2005-01545-WC-R3-CV (Tenn. 2007).

Some states allow coverage for independent contractors by means of a special policy endorsement. Some states require independent contractors to register with the state. They assume that all unregistered workers are employees. For construction projects, some states apply coverage under the prime contractor or property owner policy if a subcontractor does not have a workers’ compensation policy.

If a ministry intends to enter an independent contractor relationship with a worker, ministry leaders should consult with a locally licensed attorney to ensure that the relationship is truly an independent contractor relationship. The ministry should maintain a file copy of a certificate of insurance, indicating the contractor’s policy, providing that the contractor has coverage.

Recommended Resources

For more information on this topic, see the complete list of questions about independent contractors.

*Important information: Brotherhood Mutual is pleased to provide Legal AssistSM as a complimentary resource. The services we offer through Legal Assist are intended to provide general legal information to our current and prospective policyholders.

The information we provide is intended to be helpful, but it does not constitute legal advice and is not a substitute for the advice from a licensed attorney in your area. Accordingly, no attorney/client relationship is created through this process, and no legal advice will be provided. We strongly encourage you to regularly consult with a local attorney as part of your risk management program.