Can Freelancers Apply For Workers Compensation Benefits? (NY)

There are a lot of professionals in this field who will laugh at the notion that freelancers can be entitled to employee benefits. “Of course we’re not eligible for Workers Compensation! We’re independent contractors!” The idea does seem as preposterous and fanciful as a soul-devouring stenotype.

Souls purchased separately.

To give a brief overview, in New York, to avoid clogging the court system with employee accident cases, Workers Compensation coverage allows employees injured on the job to apply for benefits to cover their medical expenses and/or wages. To many, this would be where the discussion ends. If you’re not an employee, you can’t get benefits. But when we look into exactly what constitutes an employee, and the way this actually works, we find that the answer is more likely “it depends.” Administrative and judicial judges will look at several factors to determine whether someone is an “employee” or an “independent contractor” under the law, and how the “hiring entity” and the “hired entity” classify the relationship is not a major factor listed on their website.

  1. The right to control. Does the hiring entity or employer control the manner in which the work is done? In stenographic freelance circles, and particularly in New York, this can be a mixed bag. They might ask you to use a specific layout, arrive at a specific time, or even bring snacks to a depo. There are varying degrees of control, and if your agency is exercising a lot of control over you, you just might be an employee.
Text from the WCB site.

2. Character of work. If the primary work performed by the hiring entity is performed by the hired entity, that means the hired entity is an employee. Again, this is something you can probably argue both ways in stenographic circles. You can easily make the claim that court reporting agencies are in the business of providing court reporting services and therefore we should be employees. You can also make the argument that court reporting corporations are not in the business of court reporting, but rather acquiring court reporting professionals for lawyers. Just to note, US Legal tried that in an Unfair Competition case in California during the Holly Moose case. It argued that it was not a shorthand reporting corporation. Justice Elia rejected that, stating “such circular reasoning reasoning to evade…” [this state’s laws] “…is, at a minimum, unpersuasive.” Who can say what a judge in New York might say when applying the facts of a case to New York law?

Text from the WCB site.

3. Method of payment. The important bit here is that whether you receive a 1099 or W2 does not matter in determining an employee/employer relationship. Whether you receive regular payments or whether you are paid for a task as a whole is a deciding factor. Again, it can easily be argued either way dependent on the facts of a freelancer’s “employment,” are they taking jobs regularly and getting regular payments? Are they hired for a one-off assignment?

Text from the WCB site.

4. Furnishing equipment. The vast majority of us maintain our own equipment, and if a workers comp claim were ever made against an agency, I imagine the first thing they would do is bring out that fact. But there are other things to consider. Does the agency supply you with business cards or other materials that you’re supposed to hand out? Some do, some don’t, and that makes this a factor worth considering.

Text from WCB.

5. Right to hire/fire. This relates to the right to hire and fire who’s doing the work. For example, when an agency contracts you, a true independent contractor would have full authority to contract that out to someone else. In my time freelancing, I saw worksheets that forbade such behavior. Ultimately, the right to hire and fire is dominated by the agencies, and this makes a good case, on this factor, for reporters as employees.

Text from WCB.

6. Postmates Decision. Court reporters were doing the gig economy before it was popular. Now many states are grappling with how to treat these cases where someone may be called an independent contractor but meets all the definitions of a common law employee. In New York, we had the Postmates decision. That looked at several of these factors including the character of the work, right to control, and the method of payment. Another thing looked at was who controlled the customer and whether the independent contractor was able to go out and build his own customer base. This is something that court reporters are split on. Many of us have our own clients and many of us work exclusively through agencies. The Postmates decision gives us a look at how administrative judges and appellate courts might look at these kinds of issues in New York. If you don’t have any control or interaction with the client beyond the work you’re doing, a court could look at that and say “employee.”

Taking in all the factors above, as intelligent people not trained in law, we can see how we might argue it both ways. We can see that it’s very clear that the law doesn’t care much how the employer and employee classify the relationship. We can see what’s happened in this state and other states, and we can come to an interesting conclusion. Can freelancers claim Workers Comp benefits? It depends. Can the claimant show that they meet the definitions of a common law employee? I can’t answer that for you. But I can say that if you’re someone who’s injured on the job and meets these eligibility factors, it may just be worth consulting an attorney to give you real advice on your specific situation and the facts of your specific case. Independent contractors, on the other hand, generally may, but are not required to, purchase Workers Compensation insurance. This can be done to guard against medical bills or fulfill the terms of a contract.

Finally, as someone who briefly owned a corporation, I can tell agency owners to make sure you have a rider or option on your Workers Compensation insurance that covers you if an independent contractor claims they’re an employee. You don’t want to end up in a situation where you have a misclassified employee without coverage. It can constitute a crime to fail to follow our Workers Comp law. You can try searching other reporting firms and see what insurer they use. You can also engage with NYSIF to see if they offer a better rate than your current provider. Whatever you do, just be aware that this is a possibility, and the more your freelancers fit into those eligibility factors, the more this could end up a problem for you. I don’t want a problem for you. Chances are good an injured reporter doesn’t want a problem for you. But if somebody’s hurt, can’t work, and the medical bills are piling up, chances are good they’re going to take whatever avenue they’ve got to take to survive. The least we can do is keep this open for discussion.

Stenographers, US Legal Is Not Your Friend

As some quick background, I received an anonymous email that basically said “US Legal is shifting to ECR and having stenos train them, your mileage may vary but your days are numbered.” Hit up two of my favorite friends and mentors about it. One said, “they sent it to you because you blog everything, don’t give them any air time.” The other said, “look into it, verify whether or not it’s true, and there’s not much you can do about it.”

So anyway, I took the second option, and I surveyed some people using Google/Facebook, and like me, people had heard this before. A dear friend sent me a mailer that was received from US Legal CA. They want people to transcribe from home. Then I went looking on the careers page of the website and found their New York listing for Electronic Court Reporter. Probably because we are 1099s, there’s not the slightest mention of stenographic reporter.

But this inspires some critical thought. Why would a company push so hard for transcribers and electronic recorders? My opinion? They believe that the alternative methods are where the almighty dollar is. But they rely on us not speaking about it. They rely on us not sharing this message. They rely on us continuing to work with them using our infrastructure and experience that stenography has built over the last six decades. So I have an honest message to any stenographic reporter: Leave them in the dust. Don’t take the jobs, take the clients. It’s one thing if you want to work with us and pay us well. It’s another thing entirely to position yourself to do away with us. These aren’t your clients, they are our customer base, and we’re taking it back.

Consider too that these companies have shown the willingness and desire to not play by the rules. In a recent decision, Holly Moose v US Legal, US Legal argued that it should not be bound by state rules because it is in the business of connecting customers with independent contractors. The court said that this logic was unpersuasive at best.

Our ability to stay vibrant and the viability of this field rely on being visible and profitable. Nobody is going to educate stenographers if we’re making transcriber money. If a company offered you double your money this year but no more jobs after that ever from anyone, would you take it? That’s what we’re looking at on a grand scale the more we put our heads in the sand. Companies exist out of convenience to their investors. Reduce that margin, watch them pull out, and let the work flow naturally where it needs to: Stenographic court reporters.

Of Strategy and Commitment

Before you read another word, if you want to cut to the chase and help: Go to the nearest public forum where court reporting or stenography is a topic and write something positive about steno. The rest of the post is a broader look at one thing I’m working on right now.Some will inevitably see my message to e court reporters and transcribers. As a matter of fact some have seen it, and I have responded. To be honest, it all goes back to a post I wrote about the limits of institution. To really sum it up, I wrote a friendly post to e court reporters and transcribers. It says, more or less:

  1. Try steno.
  2. If you won’t do that, ask for more money. The work you’re doing is valuable.
  3. Unionize.

The natural reaction to this by the typical stenographer is: But Chris, are you not outraged? Shouldn’t you be telling everyone that the main CR companies are pushing ECRs? And of course, the truth is, I am. I am outraged. You could fill a thousand stars with my outrage. But it isn’t outrage that will save us. I had the good fortune to read about the Pygmalion Effect recently and the power of words in print. The general idea is that expectations can actually affect reality, and that when people read words they are more likely to believe them and follow them.

So the strategy is simple. Take everything that makes digital reporting profitable and absolutely destroy it. Tell these people that they’re being used, tell them that they are being given less, tell them they can make more and be more productive as stenographers. It’s true! It’s the truth! It sets an expectation higher for them so that they aim for the stars and not the ground. Put steno in the best possible light with the best public face.

The next part of the strategy: Compete with these agencies. They might seem individually bigger and tougher than us because they have investors who have put down a lot of money, but if there’s one thing history tells us it’s that big companies with national presence can go broke the same as anyone else. If stenographers compete with them, we will beat them. In about a week there’ll be a post about one company that is doing its part to push us out. If you’re not in a position to start grabbing clients, that’s okay, but contribute to the environment that freelancers can do this. Write an article about how you’d do it. Platform yourself and spread a message of how people can be successful. Maybe write stenonymously.

I will do my part to bring articles and ideas relevant to business and building business. I need to rely on my court reporting friends to spread the message, and I need to rely on freelancers to take the message to heart and execute it better than I ever could, but in the end, we as a group will come out on top, and that’s what matters to me.

One thing is clear though: Relying on someone else to fix all our problems is not safe. Everyone has their own interest, and so it is imperative to fight for our own interest. NCRA and state associations will catch on and follow our lead as we develop strategies and resources for taking back our market share. Consider it this way: There are at least 15,000 stenos across the country. If each of us contributed five seconds to something for the field, that’s a day’s worth of work done.

When An Agency Won’t Collect

Often agencies that are not paid by a lawyer give up on collecting the debt. Stenographers often have contracts with agencies as opposed to lawyers directly. This opens up a world where lawyer doesn’t pay agency, agency doesn’t pay reporter, agency writes off the debt. This is a vicious cycle where the stenographer is ultimately saddled with 0 despite it being the stenographer’s time that’s used up. The response? I think we should start looking into writing off debt too. It’s time to start breaking out those 1099s and sending them right along to agencies. Financially it is always better to make a dollar than to write a dollar off, but it is better to write a dollar off than not make a dollar.

And I’m going to come right on out and say the agency that began this post was Veritext. I saw the story of another reporter online, and this was the agency’s grand solution. Mind you, it’s actually a really good solution, but in my opinion, they should not be writing off debt and then not paying the reporter immediately. It’s disgraceful. And I hope in the future should a representative of Veritext come across this site, you’ll either report to us that you’ve changed your policy to pay your reporter in the event of bad debt, or you’re considering altering the policy.

Regardless, it’s time to take a stand on this issue as individuals. The very least we can do is make writing off the bad debt of agencies ubiquitous so that we are not left with zero. In an ideal world, perhaps we would press agencies and collect from them, but the time spent and financial expense of even the smallest lawsuit or claim is too great for many stenographers.