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Independent Subcontractors – Confusion on Classification Codes In NH


Independent Subcontractors Crackdown in NH not Classification Codes

Some confusion on independent subcontractors versus Workers Comp classification codes occurred due to new New Hampshire rules.

Map Of New Hampshire With Tower Independent Contractors On Circle USA Flag Background

New Hampshire authorities have created a new Web site that allows the public to anonymously report companies believed to have misclassified workers as independent subcontractors. The site is part of an effort by the state’s Task Force for the Misclassification of NH Workers, a group comprised of the Departments of Insurance, Labor, Revenue and Employment Security in the state. The state created the task force last year to crack down on employers who misclassify workers.

We have received a few inquiries from our New Hampshire clients on misclassification due to the above press release that made it in all of the newspapers in the area. Misclassification has to do with independent subcontractors only.

This press release does not concern employers that may have accidentally classified one of their workers in the wrong category – for example – clerical/administrative that should have been classified as manufacturing. That is the function of the insurance carrier’s premium audit process to correct these situations.

The IRS website has a great guide on how to determine if the person working for your company is a truly independent subcontractor, statutory employee, or employee.   The most important variable is the amount of control one company has over a contractor.   The more controls you have in place for the independent subcontractor, you more likely the person may be an employee.

In the next article, I will re-post the IRS rules for the classification of independent contractors or employees. However, there is a difference between tax classification and workers compensation classification codes

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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