Court of Appeals Rules in Snook case Feb 5, 2009

Snook was an independent contractor and sole proprietor who was hired by a subcontractor working on residential homes for Joyce Homes in the Highlands Ranch area of Denver. He was hurt on some scaffolding and sued Joyce Homes for negligence. Snook was supposed to have workers compensation insurance but did not. Joyce Home said it was a statutory employer under the workers comp act and as such its exposure was limited to $15000.00 The appellate court agreed that the point of this statutory employer law is to encourage you to obtain workers compensation insurance when you are a independent contractor. Thus when you don't have it you are limited to $15000.00. Snook tried all the arguments such as it is too low a figure to be stuck with and that it is a denial of due process and more. All the arguments failed. The lesson here is to always have workers comp insurance even if you are a small business if you want to be safe. If not your claim for injury, no matter how valid, may be limited no matter how serious your injury. The workers comp law is designed to protect employees and not independent contractors who really should have insurance because liability is limited to $15000.00. Unfortunately some small businesses in construction try to get by and save money on workers comp insurance. Often they are one man operations and in many ways are like employees but this is the way construction works. The plaintiff may seek to appeal this to the Colorado Supreme Court. Of all his arguments the one that strikes me as sad is that any claim he has is limited to $15000.00. That amount was placed in the law over 20 years ago and you have to wonder if it is so outdated and low that it is now unacceptable. In any event the case is here. One additional point...the Treasury Department is concerned about misclassifying workers as independent contractors to save money as noted here.