MBWCF members are responsible for their own independent contractor record-keeping practices. A recommendation to address these concerns year-round, rather than gathering information for the Fund’s year-end audit, is highly advised for ease in record retrieval.  Maintaining documentation for each independent contractor will benefit you greatly as long as the information is kept current.

An independent contractor is anyone who maintains a separate business and holds themselves out to and renders service to the public.  A person cannot become an independent contractor just because he or she wants to be, or because a member wants the person to be an independent contractor.  There are, however, circumstances that will qualify these service providers to be excludable under your workers’ compensation coverage. Without the supporting documentation for exclusion, it will be necessary to include these labor costs when calculating your actual premium charges.

A list of business entity types and the form of documentation required in order to exclude independent contractor labor costs from your premium configuration are listed below.  Also provided is a sample copy (for identification purposes) of the Insurance Bureau’s BWC-337 form, Notice of Exclusion.  Additionally, there are two sample forms of sole proprietor exclusions for service providers with and without employees, as well as sample letters to assist you in obtaining this important documentation from the independent contractor.

The dates of service from the independent contractor must correspond with the applicable Fund year.  It is suggested that you routinely obtain updated information to ensure that the proper timeframe has been covered.  (Example:  Campaign letters to the contractors at the beginning of the year attesting to the contractor’s status for the prior six months – July through December.  Duplicating the same mailing mid-year attesting to the contractor’s status for the period of January through June.)

NOTE:  Should independent contractor exposure exist and additional premium is charged for the coverage, you cannot assess the independent contractor for the increased premium.

For a list of entity types and the required documentation, click here.