Employee vs. Private Contractor

Workers’ Compensation in New Hampshire

Workers’ compensation is a benefit designed to assist employees who sustain injuries or an illness while performing a job-related task. Following an on-the-job injury/illness, workers’ compensation typically pays the employee a portion of his or her lost income. In addition, any medical costs related to the injury/illness are also paid by the insurance.

Who is Exempt from Workers’ Compensation Coverage in New Hampshire?

The New Hampshire (N.H.) Department of Labor is responsible for enforcing the statutes that relate to workers’ compensation. While employees must be covered by workers’ compensation, independent contractors do not.

What Classifies Someone as an Independent Contractor as Opposed to an Employee?

The New Hampshire Department of Labor uses the seven factors below to determine if an individual worker must be covered under the employer’s workers’ compensation insurance. To be considered an independent contractor, all seven of the factors below must be met.

The individual must:

  1. Already possess or have applied to receive a social security number or a federal employer ID number, or have agreed to complete the obligations that are required by employers under this chapter. To be valid, this agreement must be made in writing.
  2. Have full control and freedom of choice in relation to the means and manner in which the work is performed. The independent contractor has full control because it is the end result of the work that the employer has bargained for, not the manner in which the work is completed.
  3. Hire and pay his or her own assistants (if applicable). And, if these assistants are the contractor’s employees, supervises their work.
  4. Be the one who is responsible for the project’s final result and, in the event that the results are unsatisfactory or the work is never completed, be held contractually liable.
  5. Control his or her own work schedule; however, the work schedule should not interfere with the completion date of the project, the agreed-upon range of work hours and, if entertainment is the type of work being contracted, the time the entertainment will be presented.
  6. Consider himself or herself to be a business owner in relation to the services being provided to the employer or is already registered with New Hampshire as a business and has recurring or continuing business obligations or liabilities.
  7. Be able to work for other companies and different employers.

Understanding Workers’ Compensation Insurance Benefits in New Hampshire

All employers with any employees, even just one, who work full- or part-time, are required to provide this insurance coverage. The benefits provided must cover an employee’s hospital, medical and remedial care as it relates to his or her workplace injury/illness.

Wage Benefits:

  • Temporary Total Disability Benefits (TTD) — Paid while the absent employee is recuperating from a workplace injury or illness. These benefits are equal to 60 percent of the injured employee’s gross average weekly wage (AWW). This weekly wage is subject to New Hampshire’s state maximum, which is $1,582.50 (as of 2018). Before receiving benefits, employees have a three-day waiting period. If the employee is disabled for at least 14 days, he or she will receive benefits for those initial three days. Payment continues until the employee completes treatment and returns to work or reaches maximum medical improvement (MMI).
  • Temporary Partial Disability Benefits (TPD) — Paid to injured employees who are able to return to work performing a modified or light-duty position. The amount paid with TPD is 60 percent of the difference between what the employee would receive under TTD and what he or she is actually receiving while working the modified position. This benefit ends when the employee returns to work on a full-time basis or the employee reaches the maximum number of weeks allowed under New Hampshire law. Employees are eligible to receive these payments for up to 262 weeks.
  • Permanent Partial Disability Benefits (PPD) — Paid to an employee when a permanent impairment results from a workplace incident. A permanent impairment would be something like an ongoing back or neck injury, or the loss of a limb. The payment amount correlates directly with the severity of the disability. PPD is determined and paid out to the employee once he or she has reached MMI. Employees receiving other workers’ compensation wage benefits are still eligible to receive PPD benefits because this is a separate amount for the permanent partial disability the employee sustained. The PPD benefits provide the employee with his or her regular weekly wage, multiplied by the number of weeks that correlate with the severity of the employee’s injury. New Hampshire allows a maximum of 350 weeks.
  • Permanent Total Disability Benefits (PTD) — Paid to employees who sustain severe injuries/illnesses that lead to permanent, total disability, resulting in an inability to return to the workforce. When an employee suffers a permanent total disability, he or she receives benefits that are equal to 60 percent of his or her gross AWW. This payment amount is subject to New Hampshire’s weekly wage state maximum of $1,537.50 (as of 2017). The employee receives this payment for the duration of his or her disability.

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