IC Alert: Colorado

The Independent Contractor Monitor

[Reprinted with permission from Contractor Management Services, LLC]

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COLORADO

WARNING: Colorado Assembly members move to repeal exemption from Colorado’s workers’ compensation statutes for drivers operating under a lease agreement with a common carrier or contract carrier, and eliminate the right of independent contractors to choose their own coverage.

On February 16, 2006, Senate Bill 2006-191 (SB 06-191) was introduced in the Colorado Assembly. The sponsors of this bill are Sen. Veiga and Rep. Larson. SB 06-191 proposes to eliminate sections 8-40-301(5) and (6) of the Colorado Revised Statutes. Section 8-40-301(5) currently excludes from the term “employee,” for purposes of workers’ compensation, any person who works as a driver under a lease agreement with a common carrier or contract carrier. Section 8-40-301(6) provides that a driver excluded from the term “employee” pursuant to Section 8-40-301(5) shall be eligible for and must be offered workers’ compensation coverage by Pinnacol Assurance or similar coverage that complies with Sec. 40-11.5-102(5). The carrier can require, in the lease agreement, the driver pay for the workers’ compensation or similar coverage.

If SB 06-191 is passed, independent contractor drivers will no longer be exempt from being considered an employee of the carrier for purposes of workers compensation. This means that a carrier must cover the independent contractor driver, as an employee, under the carrier’s workers’ compensation policy. Currently, a carrier need only offer independent contractor drivers coverage under either Pinnacol Assurance or similar coverage. If the driver accepts the offered coverage, the carrier may require the driver pay the premiums for such coverage. SB 06-191 will eliminate an independent contractor’s ability to reject coverage offered under either Pinnacol Assurance or similar coverage, and to obtain other alternative coverage (e.g., coverage under a group occupational accident insurance), if the independent contractor so chooses. SB 06-191 will require all independent contractor drivers in the courier, delivery, taxi, limousine, trucking and similar industries be treated as employees for purposes of workers’ compensation.

Dennis P. Roccaforte
President - Contractor Management Services, LLC.

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