With the rise of remote working and the opportunities it brings for living with more flexibility, telecommuters are enjoying working from their homes, favorite coffee shops, or anywhere else they may fancy. Digital nomads, many of whom consider themselves to be the future of remote working, are even taking to planes, trains, and automobiles in order to work from wherever they please.
With this increase in telecommuting, businesses face unique challenges regarding how they handle everything from company policies to business insurance. Whether you’re a remote worker yourself or you employ remote workers who wish to travel, you likely have many questions about workers’ comp for digital nomads.
Here, we’ll break it down and help you understand the laws and circumstances that dictate how workers’ comp covers digital nomads.
What Are Digital Nomads?
First, let’s talk about what distinguishes digital nomads from other telecommuters. Unlike remote workers who primarily work from home in a home office, digital nomads work from various places at various times in their career. Whether they’re traveling around the globe, road-tripping across the United States, or office-hopping to various co-working spaces in their home city, digital nomads are usually more flexible and independent in how and where they work.
Many digital nomads are freelancers or independent contractors. Others may be employed full-time by companies that are open to a more flexible working experience.
Workers’ Comp for Digital Nomads
If your office is on the beach, what role does workers’ comp insurance play in your working life? As a business owner who employs remote employees, are you legally required to provide workers’ comp coverage for them? These are important questions for both digital nomads and the companies that employ them. Workers need to know if they’re covered, and business owners need to know if they should provide coverage and what, if any, liabilities they face with having a digital nomad on their payroll.
The answer to these questions lies in how an employee is categorized at the company. If an employee is classified as an independent contractor or freelancer, or, in other words, is not considered an official employee, then it generally falls on the employee to provide their own workers’ compensation insurance. This is similar to how freelancers and independent contractors are responsible for paying their own taxes, social security, pension, and other benefits. Although state laws may vary regarding how businesses treat independent contractors and freelancers, this is the case for most states.
If an employee is classified as an employee, however, the laws of the state that the business operates in will determine whether or not the business must provide workers’ comp insurance. If you own a business and your state law finds digital nomads to be employees eligible for workers’ compensation, you must pay for insurance coverage for all qualifying employees.
Digital nomads who are employees and are required by state law to be covered by workers’ compensation can run into an additional challenge: workers’ compensation only covers work-related duties and the line between personal time and work time can become blurred for digital nomads.
For example, what happens if a digital nomad is working on the beach and during the course of a busy day sustains back injuries due to hours at the laptop? In this case, workers’ compensation would likely cover the injury because it was work-related, even though it happened at the beach. If, on the other hand, a digital nomad working as a copywriter was taking a break at their hotel gym and got injured on the treadmill, this would not be covered, because the worker was not engaged in work activities.
What about if a digital worker is working at a coffee shop and spills coffee on themselves, causing burn injuries? This is a gray area.
In fact, there are many gray areas with digital nomads and workers’ compensation, and in these situations it may take negotiation or even taking a claim to court to determine whether the worker is eligible for benefits. It can be hard for workers to prove they were actively working when an injury took place and not taking a break, for example. There may not be witnesses who can determine if an injury happened in the course of work duties and it may be up to the worker to provide evidence that their injury was caused by work, whether they were injured when biking to a client meeting, suffered an injury on a plane while working on a laptop, or otherwise were injured in this type of “gray area” incident.
Craig Shapiro is Vice President, Product & Underwriting for Cerity, a workers’ compensation insurance provider founded with a bold vision to reimagine small- to medium-sized business insurance. With its digital-first approach, Cerity is transforming the entire process to empower business owners to quickly and easily protect their team, assets and livelihood through an online workers’ compensation solution. Follow Cerity on Twitter @CerityisHere. For more information, go to: https://cerity.com/solutions/workers-comp/.