Skip to Content

Get Your FREE Consultation


Workers’ Comp: Employee or Independent Contractor? Court of Appeals Sheds Light

In Capps v. Southeastern Cable, the employee was hired by Southeastern to install cable TV an internet service for Time Warner cable customers. Southeastern told its installers that they were being hired as independent contractors rather than employees. Installers were required to provide a certificate of insurance showing that they had workers’ compensation coverage. Finally, Southeastern gave its installers 1099 tax forms, used for payments made to independent contractors.

While performing an installation, Mr. Capps fell and injured his foot. Alleging that he was an employee of Southeastern instead of an independent contractor, he filed a claim for workers’ compensation benefits, which Southeastern denied. The Industrial Commission concluded that he was an independent contractor and denied benefits.

The Court of Appeals reversed the Industrial Commission and held that Mr. Capps was an employee. In reaching the decision, the Court engaged in a detailed analysis of what are known as the Hayes factors, used by court to differentiate between an employee and an independent contractor.

Importantly, the Court of Appeals gave little weight to Southeastern’s treatment of its installers as independent contractors. The opinion notes, ‘[W]e do not give significant weight to this evidence since all that this evidence tends to show is the manner in which Defendant wished to have the business relationship characterized. As the Supreme Court has previously noted, ‘the parties’ own conclusion about their legal relationship is not binding on the court.” (emphasis added). In other words, just because Southeastern wanted Mr. Capps to be considered an independent contractor did not mean that he actually was one.

The Capps decision is important because it refuses to allow employers to avoid their responsibility to provide workers’ compensation simply by labeling their workers ‘independent contractors.’ Employees have little to no control over a business’ decision to pay them under a 1099 rather than a W2. If the Court had reached a different conclusion, employers could have easily ‘gamed the system’ by deciding to ‘label’ their employees as independent contractors. Capps prevents employers from manipulating the system and instructs the Industrial Commission to look at the actual facts rather than the employer’s labels.

No Win, No Fee

Review Us

Martin & Jones, PLLC logo

“We would like to express our gratitude to you (Hunt Willis) for accepting our case. First of all, when I called this law firm, a very sweet and kind lady answered the telephone and gave me assurance by asking and going over the accident with me, while my husband was in the hospital. I felt assured I was doing the right thing for us. She was so helpful in so many ways. What a professional lady. Secondly, we are much pleased that you have settled this case with the insurance company to receive the proper amount to assist us in so many ways. My husband and I are very happy with you and the firm in handling our case. You made us have confidence in your professional and integrity along with your assistant Ms. Routh, when you both came to see us in our home, in which we saw your compassion and thoughtfulness at that time. We will never forget what you have done for us, and we thank the lord for directing me to contact this firm. I’m glad I did.” 

Contact Our North Carolina Personal Injury Law Firm

for a Consultation for Your Accident or Medical Malpractice Claim

Call us at 800-662-1234
No Win, No Fee

The law firm you choose makes a difference. If you are the victim of an accident or an illness that someone else caused, the North Carolina personal injury law firm of Martin & Jones has the depth of experience, skills and sensitivity to make your road to recovery as smooth as possible. Whether you have experience with the legal system or have never hired a medical malpractice or personal injury lawyer before, our attorneys and staff will do our best to answer your questions, provide clear advice and prepare you and your family for what to expect. If you would like more information or to meet with one of our attorneys, please fill out the form below or call us at 800.662.1234.