Tips for attorneys to avoid the independent contractor trucker defense in truck injury litigation
Over the last several years, I’ve noticed a trend in trucking litigation of commercial trucking companies attempting to re-classify their drivers as “independent contractors,” instead of as driver employees of the company.
They’re doing this (on the advice of the defense and insurance lawyers), in efforts to cut-off liability in certain negligence claims that can arise in a lawsuit if one of their drivers causes a serious truck wreck that injures or kills someone.
This classification is very often incorrect. And way too many plaintiff-personal injury attorneys who do not fully understand trucking litigation are falling for it. But for the motor carriers who are knowingly doing this to avoid potential liability claims, it’s also quite illegal.
A powerful recent example is the $228 million settlement FedEx has to pay in a lawsuit alleging it deliberately misclassified thousands of workers as independent contractors instead of employees. I wrote about this trend on my Truck Accident Attorneys Roundtable website, which is another law firm I co-founded that helps people in catastrophic truck wrecks throughout the country.
Today I wanted to address the issue of truck companies incorrectly classifying their employees as independent contractors specific to Michigan, where I primarily practice law (although as a founding member of the Truck Accident Attorneys Roundtable, I also litigate catastrophic injury cases around the country).
Michigan law is very specific on the distinction between employees and independent contractors. Services are considered employment if performed by an individual whom the Michigan Administrative Hearing System determines to be in an employer-employee relationship using the 20-factor test in IRS revenue ruling 87-41.
By deliberately misclassifying employees as independent contractors, trucking companies also avoid having to purchase required Michigan workers’ compensation insurance. But this is a short-sighted move, as workers’ compensation insurance is relativity cheap and designed to protect both the employee and the employer in the event of a work-related accident.
The misclassification of truckers also has a real human cost, as well as consequences for the trucking company, when drivers get hurt and cannot pay medical bills or support their families.
For more information about the consequences and to see how the workers compensation system plays into the common scenario of when a misclassified truck driver is injured, take a look at this excellent blog post from workers compensation attorney Jeffrey Kaufman at the Michigan Workers Compensation Law Firm, “What’s the big deal about employee misclassification?”
Who pays for a truck driver’s No Fault insurance benefits?