The Kentucky Workers’ Compensation Act requires an employer to provide coverage to employees, including employees of any uninsured subcontractor hired by the policyholder. KEMI will collect premium from the policyholder for any employee of an uninsured subcontractor.

If the subcontractors have their own workers’ compensation insurance, you must provide KEMI with a valid certificate of insurance for the period that work was performed. A KEMI auditor may then make the determination not to charge premium for the insured subcontractors.

If a policyholder wishes to consider any portion of contract labor as an independent contractor(s), the following information is required to assist in the determination of an employment relationship or independent contractor status:

1. Signed copy of contract detailing independent contractor relationship or copy of bid/proposal for jobs completed by contractor.
2. All invoices for material and labor used during the policy period between insured and the contractor.
3. Valid general liability certificate of insurance (COI) covering at least six months of policy period of insured.
4. Signed affidavit regarding employees, contract labor, casual labor, or subcontractors used for any of the work performed for the insured.
   Independent Contractor Affidavit | Independent Contractor Affidavit (Spanish)

To be excluded from coverage, all information above must be received during the premium audit process and must disprove an employee relationship.

KEMI reserves the right to charge for labor on a contractor, despite having all required information, based on additional information received during the policy period or at final audit.

Any type of “waiver” or “exemption” form an uninsured contractor provides is not equivalent to a valid  COI and will not be sufficient to have payments to the uninsured contractor excluded from the audit. To review KEMI’s audit process, click here.