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Independent contractors, misclassification and uninsured employers

By the CalCompGuide editorial team · Last updated November 2026 · How we write and check guides

The ABC test

A worker is an employee unless the business shows that the worker: (A) is free from its control and direction in doing the work; (B) does work outside the usual course of the business; and (C) is customarily engaged in an independently established trade or business of the same kind (LC §2775). The test has applied to workers' compensation since July 1, 2020. Some occupations are exempt and judged under the older multi-factor test.

Examples that are often employees despite a 1099: construction laborers working for a contractor, house cleaners for a cleaning company, delivery drivers for a delivery business, and warehouse workers hired through informal arrangements.

App-based rideshare and delivery drivers

Under Proposition 22, drivers for app-based rideshare and delivery companies are generally treated as independent contractors, and the California Supreme Court upheld Prop 22 in 2024. Those companies must instead carry occupational accident insurance for drivers, which is different from workers' comp. If you were hurt while driving for an app, ask the company for its accident insurance claim process, and keep screenshots of the trip.

If your employer is uninsured

Almost every California employer with employees must carry workers' comp. Working for an illegally uninsured employer doesn't leave you without options:

• You can file a workers' comp claim against the employer at the WCAB, and if the employer can't pay, the UEBTF may pay benefits (LC §3716). Naming and serving the employer correctly is important (I&A guide 16).
• You may also be able to sue an uninsured employer in civil court, with the law presuming negligence (LC §3706).
• If you worked through a subcontractor, the general contractor or property owner may be responsible in some situations.

How to prove you were an employee

• Who set your schedule, supplied tools and told you how to do the work.
• Texts or emails with instructions, pay records and photos of uniforms or vehicles.
• Whether you had your own business, license, insurance or other clients.

Employment status is often the first fight in these cases, decided at a priority conference at the WCAB. This is a good time to talk to an attorney.

This guide is general information, not legal advice. Every case is different. For free help from the state, call the DWC Information & Assistance unit at 1-800-736-7401.