For additional information about workplace injuries, compensation claims, and the Workers’ Compensation system in British Columbia, please also review the following articles:

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• Workplace Injuries and Workers Compensation Claims
• Overview of Workers’ Compensation in British Columbia
• WorkSafeBC Claims Guide for Injured Workers
• Who is Covered by Workers' Compensation Act?

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In today's dynamic work landscape, understanding the distinction between independent contractors and employees is crucial. This difference extends to WorkSafeBC coverage, and it's a topic of paramount importance for employers and individuals in British Columbia. WorkSafeBC's Personal Optional Protection (POP) offers an optional safety net, providing workplace disability insurance, health care, wage loss benefits, and rehabilitation support to those who choose to participate. But who exactly qualifies as an independent contractor, and what are the implications for their WorkSafeBC coverage?

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What is Personal Optional Protection coverage?

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Independent Contractors can purchase Personal Optional Protection (“POP”) coverage from WorkSafeBC.  POP is optional workplace disability insurance, which may entitle an injured person to health care, 90% of their wage loss, and rehabilitation benefits.  Registering for WorkSafeBC POP turns an independent operator into a worker for the purposes of the compensation provisions under the Workers Compensation Act, RSBC 2019, c 1 (the “Act”). The extent of benefits depends on how much wage loss coverage is purchased.  As of 2023, the minimum monthly coverage is $2,700, while the maximum is $9,400 or the amount equal to your monthly earnings, whichever is lower.

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Worker or Independent Operator?

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Distinguishing between a worker and an independent operator has been contentious.  Proprietors and partners in a partnership who operate independent businesses are not automatically covered by WorkSafeBC.

Section 4(2) of the Act describes an independent operator as someone “who is neither an employer nor a worker.”  An independent operator may be a sole proprietor or a partner of a partnership.  Meanwhile, the Act defines a worker as an individual performing a contract of service (whether in writing, oral, express, or implied) who does not have an independent business under that contract.  A worker is paid by wage, salary, commission, piecework, profit sharing, or other means.

Policy Item AP1-1-1 of WorkSafeBC’s Assessment Manual provides factors to consider in distinguishing between a worker and independent operator:

(a) Control: WorkSafeBC considers the ability, authority, or right of the person for whom the work is done to exercise control over the individual doing the work.  The greater the degree of control, the more likely the individual doing the work is engaged under a contract of service.

(b) Chance of profit and risk of loss: Whether the individual doing the work has an opportunity to make a profit, and whether the individual doing the work will risk a loss.  Profit is not renumeration based, rather the difference between revenue earned and expenses incurred.

(c) Provision of major equipment: Whether the individual doing the work is required to provide assets used to generate revenue and needed to perform the work.

(d) Business integration:  WorkSafeBC considers whether the individual doing the work has or continues to have an independent business in existence during the course of the work.  WorkSafeBC may also consider who is best able to fulfill the occupational health and safety and other obligations of an employer under the Act.

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Weighing these factors will depend on the context of the relationship.  WorkSafeBC may also consider the structure and customs of the industry, the parties’ intentions, and the terms of the contract.
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These are factors similarly considered in an employment context when distinguishing an employee from a contractor.   WorkSafeBC adopts common law’s general concept of contract of service but does not adopt all its technical rules.  This means coverage under the Act may commence even though by common law principles no contract of service yet exists (Policy Item AP1-1-1).  
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Review Division decision no. R0304257 dated July 19, 2023, assessed whether the Board appropriately classified a finishing carpenter as a worker.  The employer appealed the Board’s decision which found that the individual was a worker of the company and entitled to coverage under the company’s account.  The employer became responsible for reporting payroll and paying assessments on the worker’s earnings.  The employer advocated that this individual did not work solely for them.  
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The Review Division applied the above-noted Policy Item AP1-1-1 factors.  The Review Officer found that the finishing carpenter “would not likely have a significant degree of control over how or where the work is performed.”  The individual advised that he provides his services on an hourly basis and that it does not appear that he would have a chance of profit and risk of loss.  Further, the finishing carpenter is expected to provide his own hand tools, ladders, and consumables, but not any major equipment.  Lastly, the finishing carpenter worked on projects controlled by the employer.  The employer was found to be the applicable body to fulfill the occupational health and safety obligations under the Act.  As a result, the finishing carpenter was deemed a worker and the employer became responsible for associated premium increases, if any.  
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What is intriguing about the Review Division’s decision no. R0304257 is that the finishing carpenter applied for coverage with the Board.  During the assessment, the finishing carpenter affirmed that he had a contract with the company to perform services on a labour-only basis.  It appears that the Board gave weight to the fact that he was not working with any other companies at the time of his application—which is a key consideration for employers working purported independent contractors going forward.

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What Does All This Mean

In essence, the fine line between independent contractors and employees is not always straightforward, and the implications are significant. How the parties label their working relationship is not determinative of whether an individual is a contractor and responsible for their own WorkSafeBC coverage. It’s about the level of control, profit opportunities, risk of loss, equipment provision, and business integration.

Recent decisions, such as the case of the finishing carpenter above, demonstrate that WorkSafeBC's assessments can carry substantial consequences for both individuals and employers. As an employer, it's crucial to understand these nuances, and for individuals, it's vital to consider your coverage options carefully.
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In the ever-evolving landscape of employment law, the key takeaway is that assumptions about your employment status aren't enough. Whether you're an employer or an independent contractor, understanding the nuances of WorkSafeBC coverage and the factors that influence it is essential to protect your rights and financial well-being. So, before you make any assumptions or decisions, consult with legal professionals who specialize in employment law to navigate the complex terrain of WorkSafeBC coverage with confidence. Our experienced team is here to help!

Note to Readers: The information in this bulletin is for general guidance only and does not constitute legal advice. It is based on the current laws and regulations in effect at the time of writing, but may be subject to change in the future. The blog post does not take into account the specific circumstances of any employer or employee, and should not be relied upon as a substitute for professional legal counsel.

If you are looking for legal advice in relation to a particular matter please contact one of our group members. We communicate all these updates to our clients and readers on our Employer Resources Portal and through monthly Newsletters.

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