Independent Contractors In South Carolina

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South Carolina Independent Contractors

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The following is a great assessment of how a specific Workers Compensation Commission views independent contractors. Even if your company has no Workers Comp concerns in SC, the control issue is spelled out here very well. The issue of employee vs. subcontractor is very important at the time of your yearly premium audit.

State of South Carolina

Workers’ Compensation Commission

October 6, 2009

Coverage Requirements and Statute References

Employers frequently contact the SC Workers’ Compensation Commission to ask, “Do I need workers’ compensation insurance?” Any employer in South Carolina who regularly has four or more workers full-time or part-time is required to have workers’ compensation insurance.

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However, there are exceptions, as outlined in the SC Code of Laws Section §42-1-360. The exceptions include: agricultural employees; persons engaged in selling agricultural products; casual employees; state and county fair associations; federal employees; railroads and railway express companies, and employers who have a total annual payroll of less than $3,000, regardless of the number of workers employed during that period. Also exempt are owner-operator drivers and certain commission-paid real estate agents, which meet specific threshold requirements.

Employer-employee relationship case law defines the fundamental test of employment relationship as the right of the employer to control details of an employees work. It is not actual control exercised, but whether there exists right and authority to control and direct the particular work or undertaking as to the manner of means of its accomplishment.

The courts have defined regularly employed as meaning employment of the same number of people with some constancy throughout a relevant time period. Employment situations are not always clear. Seasonal employment is a good example. In instances like this a Commissioner, based on the finding of fact, determines whether an employer regularly has four or more employees.

Employment is casual when it is not permanent or periodically regular but occasional or by chance and not a usual course of the employer’s trade or business. Case law provides that if an employee is doing a task within the business, trade, or occupation of his employer, the employee is not casual, even if the duration of employment was brief and isolated. Part time employment is not casual in nature and is not included in the exceptions under Code Section §42-1-360.

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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt 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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