Worker's Compensation - Worker Classification

Nine Requirements Test - Independent Contractor

Requirement Five - Satisfactory Completion of Work or Services (Case Studies)

The individual is responsible for the satisfactory completion of work or services that he or she contracts to perform and is liable for a failure to complete the work or service.

Case Studies Relevant to Requirement Five

Wis. LIRC WC Decision: Overturf - March 15, 2010

Delane Overturf, the applicant, operated a sole proprietorship named DLO Enterprises, through which he performed carpentry work for different customers. One of DLO's customers was Forward Management, a company that managed rental and commercial properties, and also performed construction remodeling, repair, and painting services. On June 7, 2006, the applicant was performing carpentry work on Forward Management's president's (Dan Schmidt's) house, when he fell more than 20 feet off scaffolding and sustained serious injuries. The issue is whether at the time of injury the applicant was performing his services as a covered employee, or as an independent contractor.

One of the requirements that DLO Enterprises had to satisfy to demonstrate that the applicant was an independent contractor was that the applicant was responsible for the satisfactory completion of the work he contracted for and that he was liable for failure to complete the work.

The commission found that the applicant was responsible for satisfactory completion of his work, and if he did not complete it properly, he would not be paid. At one point, the applicant hung a door in an unsatisfactory fashion, and he was not paid for this work. The commission found that Requirement Five was satisfied.

Wis. LIRC WC Decision: Shilling, Michael - February 7, 2001

Michael Shilling, the applicant, was injured on November 20, 1998, when he was electrocuted while painting a building, and fell 20 to 30 feet to the ground. He suffered electrical burns, and dislocated his hip. As a result, he sustained considerable disability and incurred considerable medical expense.

The applicant performed the painting job on which he injured as part of an ongoing relationship with Richard S. Schaefer, a/k/a Scott Schaefer. On appeal to the commission, the primary issue is whether the applicant was an employee of Mr. Schaefer's when injured, or an independent contractor excluded from the definition of "employee" for the purposes of workers compensation laws.

One of the requirements that DLO Enterprises had to satisfy to demonstrate that the applicant was an independent contractor was that the applicant was responsible for the satisfactory completion of the work he contracted for and that he was liable for failure to complete the work.

Mr. Schaefer testified that he inspected the applicant's work, and testified that he might have to finish it himself, or if he noted a problem before the project was completed, he would have the applicant redo it. The commission concluded that Mr. Schaefer was liable to the home or building owner with whom he contracted, while the applicant might be viewed as liable to Schaefer.  This arrangement seems similar to the situation that arises in a standard employer-employee relationship.  The commission concluded that Mr. Schaefer was ultimately responsible for the satisfactory completion of the work. Requirement Five was not satisfied.