Arkansas Independent Contractors laws & compensation compliance analysis

Arkansas Independent Contractors: What you need to know

Whether a worker is an “employee” or an “independent contractor” is critical when it comes to such important issues as pension eligibility, workers' compensation coverage, wage and hour law, and many other matters. In some situations, federal law will govern, but the question is most often resolved by looking to state law, particularly in areas such as unemployment tax liability, workers' compensation, and state wage and hour requirements.
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The Arkansas minimum wage law specifically excludes "bona fide independent contractors" from coverage. The law defines an "independent contractor" as any individual who contracts to perform certain work away from the premises of his or her employer, uses his or her own methods to accomplish the work, and is subject to the control of the employer only as to the result of his or her work (AR Code Ann. Sec. 11-4-203).
An employer-employee relationship is a prerequisite for eligibility for workers' compensation coverage. Special rules that are designed to protect employees apply to workers' compensation. In determining whether an individual is covered as an employee under the workers' compensation laws, the state will inquire not only whether the worker has the right of control, but also whether the worker is a member of the class targeted for protection by these enactments. For example, someone working in the employer's plant and using the employer's equipment would be more likely to expect the employer to take the responsibility for accidental injuries and would have a greater chance of being considered an employee. On the other hand, a person engaged in repairing the employer's building and using his or ...

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