Can I get workers compensation as a contractor or sole trader?
The simple answer is yes — in some situations.
While traditional employees are covered by their employer’s workers compensation insurance, contractors and sole traders operate under a different set of rules. This means they must meet special requirements to qualify for weekly workers compensation payments.
Below, you’ll find our simple guide to claiming workers compensation as a contractor or sole trader. Learn if you qualify, how much you can get, and tips for putting together a solid claim.
Keep in mind that each state has its own workers compensation scheme, so the eligibility criteria can vary depending on your location. For free legal advice on your specific situation, get in touch with our expert lawyers today.
Understanding workers compensation
In Australia, employers are required to have workers compensation insurance for all their staff, whether full-time, part-time, or casual. This means if you get hurt or sick because of work, you can claim compensation for lost income, medical expenses and rehabilitation. If your injury is permanent, you might also get an extra lump sum payment.
Can contractors and subcontractors claim workers compensation?
A contractor is someone hired directly by a ‘principal employer’ to get a job done. In contrast, a subcontractor is anyone the contractor brings in to handle specific tasks within that job. Essentially, subcontractors work under the contractor to help fulfil the overall contract.
If you’re a contractor or subcontractor, you won’t automatically be covered by the principal employer’s workers compensation insurance. Instead, you’ll need to show that you’re a ‘deemed worker’. This means that while you’re technically a contractor, the law treats you as an employee for workers compensation purposes.
To be considered a deemed worker, you typically need to meet a few key criteria. These include:
- Limited employers: if you’re primarily doing your work for one company, that’s a sign you’re a deemed worker.
- Tools and equipment: if the employer provides the tools or equipment you need to get the job done.
- Supervision and control: if your employer has a lot of say in how, when, and where you do your work.
- Type of contract: if your contract looks more like an employment agreement than a typical contractor deal.
- Integration: if you feel integrated into the company, such as attending meetings or using their branding.
- Ongoing work: if you expect to keep getting work from that employer instead of just fulfilling a one-off job.
- Payments: if you’re getting paid a regular wage instead of just invoicing for specific jobs.
If you check off several of these criteria, there’s a good chance you’re eligible for workers compensation. However, claiming benefits as a contractor tends to be more complicated than for traditional employees, so it’s important to get legal advice before starting your claim. In a free consultation, our expert lawyers will clarify your rights and outline the best strategy to prove you’re a deemed worker.
Can sole traders claim workers compensation?
A sole trader is someone who runs their own business and handles everything by themselves. While contractors and subcontractors focus on specific projects, sole traders take on a wide range of work independently.
Since sole traders are their own employers, they usually don’t qualify for workers compensation. However, there are certain situations where a sole trader might be seen as a ‘deemed worker.’ This can happen if they have regular working hours, can’t delegate their tasks, or meet the other criteria we’ve discussed above.
While sole traders can be less likely to qualify than contractors, if you’re injured on the job, it’s always a good idea to chat with a lawyer about your rights. They can dig into the details of your situation and see if you meet the criteria.
As a note, if you hire any employees or contractors, you’re generally expected to take out workers compensation cover for them.
Do I need personal injury insurance?
Many contractors and sole traders opt for personal injury insurance or income protection to protect themselves. While it’s not exactly the same as workers compensation, these types of insurance can provide similar financial help if you can’t work due to injury or illness.
You can easily find personal injury insurance or income protection from various insurers. Plus, if you have a superannuation policy, it might already include income protection — so you could be covered without even knowing it.
What should I do if I’m injured or ill?
If you find yourself injured or unwell while working as a contractor or sole trader, the first thing you should do is see a doctor. This ensures you get the right treatment and gives you the medical records you’ll need for any future claims.
After taking care of your health, the next step is to check whether you’re eligible for workers compensation. This will depend on factors like the nature of your work, your relationship with the hiring company, and whether you’re classified as a worker under the relevant laws.
Whether you’re unsure about your rights or looking to start a claim, it’s essential to get legal advice immediately. A lawyer can assess whether you’re a deemed worker and help compile evidence supporting your claim. If workers compensation isn’t an option, your lawyer can guide you through alternatives, like pursuing a common law damages claim against a negligent hiring company.
How we can help you
If you’re injured or sick, you don’t need the stress of figuring out workers compensation entitlements — you need financial help, fast. That’s where our expert lawyers come in.
For over 25 years, we’ve helped injured contractors and sole traders navigate the workers compensation system. Our lawyers know the ins and outs of each state scheme and can prove your situation qualifies for compensation. Plus, we’ll tap into our national network of medical experts to provide solid evidence that backs up your eligibility.
Reach out today to chat with a specialist workers compensation lawyer. In a free consultation, we’ll assess your situation, clarify your rights, and make sure you get the compensation you deserve.
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