You get a 1099 instead of a W-2. Maybe you were told to set up a corporation before you could start. Maybe the checks come from a company whose name you barely recognize. Then you get hurt, and the insurance carrier denies the claim in a sentence: no employer-employee relationship.
That denial is not the end of your claim. In New York, what your employer calls you does not decide whether you are covered.
The label is not the test
Whether an employer-employee relationship exists is a factual question for the Workers’ Compensation Board, decided on what actually happened at work. The factors the courts have laid out are the right to control the work and set the work schedule, the method of payment, the furnishing of equipment, the right to discharge, and the relative nature of the work (Matter of Bugaj v Great Am. Transp., Inc., 20 AD3d 612 [2005]).
And on the paperwork point the Appellate Division has been direct: “No one factor is dispositive, however, including the fact that the contract between claimant and the City designates claimant as an independent contractor” (Matter of Brown v City of Rome, 66 AD3d 1092 [2009]).
So a signed agreement calling you a contractor does not settle it. Neither does a 1099. The Board looks past the documents to the working relationship.
What the carrier will argue
Expect some combination of these:
- You received a 1099 and filed taxes as a business.
- You signed an independent contractor agreement.
- You were paid through a corporation, so your corporation was your employer.
- You could work when you wanted and turn down jobs.
- Your own company had no coverage, so the claim belongs in the Uninsured Employers Fund rather than against the carrier.
That last one matters more than it looks. Pushing a claim into the Uninsured Employers Fund gets the insurance company off the hook entirely. It is worth fighting, and it is frequently beaten.
“But I was paid through my own corporation”
This is the fact pattern that looks worst on paper and often matters least.
Workers in trucking, medical transport, home care, construction and the trades are routinely told that they need to incorporate before they can be put to work. The worker becomes the sole owner and only employee of a company that exists on paper, the checks are written to that company, and a 1099 is issued at the end of the year. Nothing about the actual job changes.
The Board is entitled to look at who set that company up and why. Where the arrangement was the hiring business’s idea, where the worker cannot explain the purpose of his own corporation, and where the company has no employees, no equipment, no other customers and no real capital, its existence is not much evidence of independence. The Workers’ Compensation Board also states plainly in its published guidance that a business cannot require its employees to obtain their own workers’ compensation insurance.
Equipment and control usually decide it
In practice, two of the factors carry most of the weight.
Who provided the tools of the job? If the vehicle belongs to the company, and the company pays for the gas, the maintenance, the tolls and the insurance, that is a heavy fact. A genuine independent business supplies its own equipment and carries its own overhead.
How much were you really free to refuse? Being able to choose your days off is not independence. What counts is whether, once you were working, you could decline the assignments that came to you. Work delivered through a dispatcher, an app or a tablet mounted in a company vehicle, on hours the company sets, at a rate the company sets and you have no say in, is controlled work, whatever the tax form says.
The same is true of a rate of pay you had no part in setting. A business negotiates its price. An employee is told what the job pays.
Construction and trucking: the law presumes you are an employee
Two industries get an additional statutory advantage, and both presumptions are written into the definition of “employee” in Workers’ Compensation Law § 2(4).
Under the Construction Industry Fair Play Act (Labor Law § 861-c), anyone performing services for a construction contractor is classified as an employee unless the contractor proves all three parts of a strict test: that the worker is free from direction and control, that the service is performed outside the contractor’s usual course of business, and that the worker is independently engaged in that trade.
Under the Commercial Goods Transportation Industry Fair Play Act (Labor Law § 862-b), a comparable presumption applies to drivers who move commercial goods, for injuries on or after April 10, 2014. Note the limit: that act is written for the transportation of goods, so drivers who carry passengers fall back on the general control test above rather than this presumption.
Where a presumption applies, the burden shifts. The business has to prove you were independent, instead of you having to prove you were not.
A note on the gig economy cases
You may have read that New York’s highest court found app-based couriers to be employees in Matter of Vega (Postmates Inc.—Commissioner of Labor), 35 NY3d 131 [2020]. That is an unemployment insurance case, not a workers’ compensation case, and the two systems are governed by different statutes. It is still worth knowing, because the reasoning is about the same thing that decides comp cases: the degree of control a company keeps over how the work gets done.
What helps
- File the C-3 anyway. A denial letter is a position, not a ruling. File and let the Board decide.
- Keep everything that shows control. Dispatch messages, app or tablet screenshots, schedules, training materials, rate sheets, texts telling you where to be and when.
- Write down who supplied what. Vehicle, tools, phone, uniform, fuel, tolls, repairs, insurance.
- Save the pay records. Checks, stubs, deposits, and which entity’s name was on them — particularly if that changed over time.
- Be precise about the corporation. Who proposed it, who filled out the paperwork, who paid for it, and what you were told it was for.
- Do not be talked out of the claim. Being told “you’re a contractor, you’re not covered” is the beginning of the argument, not the answer to it.
If more than one company was involved — hired by one, paid by another, both denying they employed you — that is a separate issue with its own rules, and it is covered on our page about general and special employers. If the dispute is that the business says you never worked there at all, see when your employer denies you worked there.
Talk to a Staten Island workers’ comp attorney
Misclassification cases are won on ordinary details — whose car, whose gas, whose schedule, who could say no. Those details are easy to establish early and much harder to reconstruct a year later.
Call (718) 701-2776. The consultation costs nothing, and you will speak with me.
Nothing on this page is legal advice about your own claim. Employment status is decided by the Board on the evidence in the record, and every case turns on its own facts.