Workers’ compensation coverage extends to:

• Undocumented workers;
• Minors;
• Elected and paid public officials;
• Qualified persons who are employed by the owner or occupant of a residential building and who are performing duties incidental to the use, ownership, or maintenance of the residence (e.g., painters, gardeners, nannies);2and
• Paid officers and directors of private or quasi-public corporations.3

Any person working for another person is presumed to be an employee unless:4

• They are employed by their parent, spouse or child to perform services in the employer’s dwelling incidental to the ownership, maintenance or use of the dwelling (e.g. child care and supervision of children).
• They’re an independent contractor, under the employer’s control only in terms of final product rather than details of performing the work. For more information on independent contractors, see Independent Contractor.
• They’re an officer or director of a private corporation, the owner of a professional corporation, a general partner of a partnership, or a member of a limited liability corporation who has elected in writing to not be covered.5 For more information on this specific exclusion, see Officers, Directors and Working Partners.
• They are performing services in return for aid or sustenance only, received from a charitable organization.6
• They are performing services incidental to the use, ownership, or maintenance of a private residence for less than 52 hours, or earning less than $100, in the 90 days preceding the injury.7
• The Labor Code specifically excludes them.8 For more information, see Who Isn’t Covered by Workers’ Compensation?.

Officers, Directors and Working Partners

Officers, directors and partners are generally now automatically covered employees under the employer’s workers’ compensation policy unless they meet a narrower definition of excluded employee and specifically opt out of coverage by signing a waiver and filing the waiver with their employer’s insurer.9

A general partner of a partnership or a managing member of a limited liability company can opt out of coverage by signing a written waiver of coverage.

An owner of a professional corporation who is covered under a private health insurance plan can opt out of coverage by signing a written waiver of coverage.

An officer or member of the board of directors of a private corporation who owns at least 10 percent of the corporation’s stock can opt out of coverage by signing a written waiver of coverage.

Contractors and Workers’ Compensation

Evidence of workers’ compensation coverage is a required condition before issuance or renewal of a contractor’s license, with very few exceptions, as discussed below.10

The registrar of contractors can issue a stop order to any licensed or unlicensed contractor who failed to secure workers’ compensation coverage for their employees. The order is effective immediately and prevents the contractor from using employee labor. Additionally, you must pay employees who are affected by the work stoppage for lost time, up to 10 days, while you seek to comply with the law.11

Failure to observe the stop order is a misdemeanor, punishable by up to 60 days in county jail and/or a fine of up to $10,000. You can protest the stop order and request a hearing, but you must do so within 20 days of service of the stop order.

The requirement for a contractor to maintain workers’ compensation coverage does not apply to licensees who have filed proper notice with the Contractors State License Board verifying that the individual does not have any employees.12 Be aware that the filing of a false exemption certificate, or the hiring of an employee after filing an exemption certificate, could subject you to disciplinary action by the Contractors’ State License Board.

Contractors with a C-39 roofing classification must obtain and maintain workers’ compensation insurance, even if they do not have any employees. Any active license will be suspended if the C-39 roofing classification was removed and the licensee is found to have employees without a valid certificate of workers’ compensation insurance.

1. Lab. Code sec. 3351