Significant Decisions

INDEPENDENT CONTRACTORS
(See also COVERAGE AND EXCLUSIONS and EMPLOYER-EMPLOYEE)


INDEPENDENT CONTRACTORS

Entertainers

A performance lease that required a dancer to pay a certain amount to a club that required performance during specified shifts to create revenue for the club was a contract, the essence of which was clearly personal labor.  The dancer was a covered worker when performing under the contract.  ....Beth Stracener, 05 14952 (2006) [Editor's Note: The Board's decision was appealed to superior court under Pierce County Cause No. 06-2-11854-1.]

Home health care attendant

Where home health care attendants assist a totally incapacitated individual, personal labor is the essence of the independent contract, and the home health care attendant is a worker within the meaning of RCW 51.08.180(1). Citing Massachusetts Mutual Life v. Department of Labor & Indus., 51 Wn.App. 159 (1988). Home health care attendants' service represented personal labor, even though based on skill and expertise, since personal labor is not restricted to manual labor. ....Mary Bliss Maxwell, 90 0855 (1991) [dissent] [Editor's Note: The Board's decision was appealed to superior court under King County Cause No. 91-2-18181-1.]

Insurance agents

Where insurance sales agents working under independent contracts with a general agent can and do employ others to perform at least part of their contracts to sell insurance, their personal labor is not the essence of their independent contracts and they are not "workers" within the meaning of RCW 51.08.180. Citing Massachusetts Life Insurance Co. v. Department of Labor & Indus., 51 Wn. App. 159 (1988). [Overruling In re Family Life Insurance Company, BIIA Dec., 63,147 (1984)] ....James D. Shanley & Wife, dba, Northwestern Mutual Life Insurance Company, 87 0485 (1988)

The statutory provisions which include as "workers" independent contractors whose personal labor is the essence of the contract were not designed to embrace only "spurious" independent contractors. (RCW 51.08.070, RCW 51.08.180). ....Family Life Insurance Company, 63,147 (1984) [dissent] [Overruled, In re James D. Shanley & Wife, dba, Northwestern Mutual Life Insurance Company, 87 0485 (1988)]

Loggers

In light of contracts which did not specifically permit contract cutters to delegate responsibilities to others and which appeared to preclude delegation without authorization, inquiry into whether cutters actually hired others is necessary in order to determine whether essence of the contract was personal labor. When cutter did not hire others, the essence of that contract was personal labor and he was a "worker" under the Act. ....Wayne Jamison et ux Wayne Jamison Timberfallers, 87 1383 (1988)

Outside salespeople

Where outside salespeople working under independent contracts with a manufacturer's representative are not required to provide any special equipment or employ others to perform the work contemplated by their contracts, and do not, in fact, delegate their duties to others, the essence of their contracts is their personal labor. Under the negative three-pronged test set forth in White v. Department of Labor & Indus., 48 Wn.2d 470 (1956) they are "workers" within the meaning of RCW 51.08.180. ....Traditions Unlimited, Inc., 87 0600 (1989)

Real estate agents

Where real estate agents working under independent contracts with a real estate company do not supply any special equipment necessary to perform the job, and it is not their duties to others, the essence of their contracts is their personal labor. The fact that agents occasionally contract with third parties to perform some services necessary to facilitate a sale does not constitute a delegation of their duties under their contracts. Under the negative three-pronged test set forth in White v. Department of Labor & Indus, 48 Wn.2d 470 (1956) they are "workers" within the meaning of RCW 51.08.180. ....Peter M. Black Real Estate Co., Inc., 88 1191 (1989) [Affirmed, Black Real Estate v. Labor & Indus., 70 Wn.App. 482 (1993)]

Sole proprietors

The requirement that an independent contractor have an account with state agencies as required for the payment of taxes provided in RCW 51.08.195(5), does not necessarily encompass contractor registration with the Department of Labor and Industries because a contractor must register with the Department and establish an account only if the contractor has employees.  ....Mauricio Torres d/b/a MT Carpets, 04 21119 (2006)[Editor's Note:  The Board's decision was appealed to superior court under King County Cause No. 06-2-25404-0SEA.]

Whether an independent contractor is exempt from coverage under the sole proprietor exclusion of RCW 51.12.020(5) depends upon factors such as whether the person (1) has a principal place of business eligible for a business deduction for IRS purposes, (2) maintains a separate set of books or records reflecting income and expenses, (3) has done everything legally necessary to establish a business in the state of Washington, (4) has obtained necessary licenses and tax identification numbers, (5) provides services to more than one person or entity, and (6) holds him or herself out to the general public as an independent business person. An additional consideration is "which way does the money flow?" ....Fiedler Industries, 89 0822 (1990) [Editor's note: See later statutory amendments, Laws of 1991, ch. 246, ( 1 (effective January 1, 1992)]