From JDSupra, H. Dill Battle III and Charity Lawrence discuss recent changes in the workers compensation practice in West Virginia including an expected change due to a new test for determining the classification of a worker as an employee or independent contractor that was adopted by the legislature. Dill and Charity write:
In addition to these changes, workers’ compensation practitioners in West Virginia are expecting an update to a workers’ compensation rule, which addresses the entities that are required to carry West Virginia workers’ compensation insurance coverage and which individuals are considered employees entitled to benefits. This rule requires updating because of the passage of Senate Bill 272, which creates the “West Virginia Employment Law Worker Classification Act” that implements a new test for determining who is an “independent contractor” in West Virginia for purposes of workers’ compensation and other areas of the law. This new “independent contractor” test will replace the current test for determining “independent contractor” status currently found in W. Va. C.S.R. § 85-8-6.2. The West Virginia Employment Law Worker Classification Act became effective June 9, 2021.
In regard to the updates of the workers’ compensation rule, the West Virginia Offices of the Insurance Commissioner (“WVOIC”) has proposed specific changes. One such proposed change is clarification of the “employee” definition to make it clear that an employee is not someone hired/classified as an independent contractor pursuant to the new law and the test for classification of independent contractors now found in W. Va. Code § 21-5I-4. “Independent contractor” will be defined as a person classified as an independent contractor pursuant to the West Virginia Employment Law Worker Classification Act and its test for classification of independent contractors.
Most substantively, the WVOIC has proposed to change W. Va. C.S.R. § 85-8-6.2 regarding independent contractors to state that a West Virginia workers’ compensation insurance policy is not required to cover “independent contractors” as that type of worker is defined pursuant to the test established in West Virginia Employment Law Worker Classification Act. Also, self-insured employers will not be required to provide workers’ compensation coverage to independent contractors. Additionally, a person will not be able to be simultaneously considered an “employee” and an “independent contractor” for the same employer at the same time.
Another proposed change is that an employer will not be required to classify a worker as an independent contractor if the employee meets the criteria in the new law; the employer may choose to hire the worker as an employee, but the terms should be set forth at the outset to eliminate any confusion about the worker’s status. Finally, independent contractors will not be covered under Chapter 23 of the West Virginia Code, and they will not be eligible for benefits under the Workers’ Compensation Uninsured Employer Fund.
Before these changes can be made they will be presented to the West Virginia Secretary of State for formal public comment and a public hearing will be held at an Industrial Council meeting. Because workers’ compensation rules are legislatively exempt, the Industrial Council must approve the rule amendments before they take can effect. The WVOIC intends to submit the changes for public comment this summer and hold the public hearing at the August 2021 Industrial Council meeting for approval of the changes.