When it comes to workers` compensation in Michigan, it`s important to understand the difference between an employee and an independent contractor. An independent contractor is someone who is self-employed and provides services to a company without being a W-2 employee. While independent contractors are not covered by workers` compensation insurance, some may opt to provide their own coverage for protection.

To help companies determine whether someone is an employee or an independent contractor, Michigan has created an Independent Contractor Worksheet. This worksheet is used to evaluate various factors that determine the nature of the relationship between the company and the worker, and whether they are an independent contractor or an employee.

The worksheet considers several factors, including:

1. Control: How much control does the company have over the worker`s schedule, work location, and methods?

2. Integration: How integrated is the worker’s service or product with the company’s overall business?

3. Tools and Equipment: Who provides the equipment and tools needed to perform the work? Does the worker use their own?

4. Profit and Loss: Does the worker have a potential for profit or loss? Is the worker paid a flat fee or is the worker paid only for hours worked?

5. Length of Engagement: How long will the worker provide services to the company? Is the worker engaged in multiple projects or contracts?

6. Professional Skill: Does the worker have a unique skill set or expertise that is not available within the company? Is the worker providing services that require a license or certification?

By evaluating these factors, the company can determine whether the worker is an independent contractor or an employee. If they determine that the worker is an independent contractor, they may need to provide proof of the worker’s own insurance coverage.

It`s important to note that the Independent Contractor Worksheet is not a substitute for legal advice. Employers should consult with an attorney or other qualified legal professional to ensure they are in compliance with Michigan laws and regulations.

In conclusion, the Michigan Independent Contractor Worksheet is a useful tool for companies to evaluate the nature of their relationship with a worker. By considering various factors, companies can determine whether an individual is an independent contractor or an employee, and ensure they are in compliance with Michigan laws and regulations. It`s always best to consult with a legal professional if there are any questions or concerns regarding workers` compensation and independent contractors.