In Washington, calling someone a 1099 contractor does not remove your duty to cover them; the state presumes a person is your covered worker unless a strict legal test is fully met. Coverage is bought from the state fund at the Department of Labor and Industries (L&I), and if a 1099 worker does not truly pass the test, their hours are yours to report. In the building trades the test is tougher still, and a general contractor can end up paying premiums on an uninsured subcontractor's crew, so this is one of the most heavily enforced areas in Washington.
Who this is for: Washington owners who pay people on a 1099 or use subcontractors and want to know when those people still have to be covered.
The short version
- Washington presumes a 1099 worker is your covered worker unless every part of a strict test is met.
- The general test has six parts; the building-trades test is stricter and requires a valid contractor registration or license.
- Miss any single part of the test and the person is treated as your employee and must be covered.
- A general contractor can be billed for premiums on an uninsured subcontractor's workers.
- You verify a subcontractor's own L&I account status to avoid inheriting their premium.
The tests Washington uses
Washington does not use a simple did-I-control-them test, and it does not use the generic wage-law version some states use. For most work, all six parts of the general test must be true: the person is free from your control in fact and by contract; the work is outside your usual business or done off your premises or at their own business location; they are running an independently established business of the same kind; they file business expenses on their tax return; they hold an active state business account with the required registrations; and they keep their own set of books. For construction, electrical, and plumbing work, the test is stricter: on top of those business elements, the person must hold a valid contractor registration or trade license and have a real place of business. Fail any element and they are your covered worker.
General work versus the trades
| Element | General work | Construction, electrical, plumbing |
|---|---|---|
| Free from your control | Required | Required |
| Own independent business and books | Required | Required |
| Files business taxes, has a state business account | Required | Required |
| Valid contractor registration or trade license | Not part of the general test | Required |
| Result if any part fails | Treated as your worker | Treated as your worker |
The general contractor trap
If you hire subcontractors, there is a second layer. Washington makes the prime contractor primarily responsible for premiums on a subcontractor's work unless the sub is genuinely independent: registered or licensed, running its own business with its own books, actually doing the trade work, and holding an active L&I account in good standing that you verified within the year before you contracted. If you skip that check and the sub is uninsured, you can be billed for the premiums on the sub's crew hours. The fix is routine: before you sign, confirm the sub's contractor registration and that their L&I account is active, and keep the record.
A Kent example
Illustrative, not a quote. A Kent general contractor brings on a framing sub he pays by 1099. Before work starts he checks that the sub holds a valid contractor registration and has an active L&I account, and he saves the confirmation. Because the sub is genuinely independent and insured, the GC is not billed for the sub's crew. A drywall helper the GC pays directly, though, has no registration and no business of his own, so the GC reports that helper's hours and covers him. See our workers comp for contractors page.
Real questions Washington owners ask
If my workers are 1099, do I still need workers comp in Washington?
Often yes. Washington presumes a 1099 worker is your covered worker unless a strict state test is fully met. If any part of the test fails, you must report and cover that person through the state fund.
What is the test for a real independent contractor?
The general test has six parts covering control, an independent business, separate books, business tax filing, and a state business account. All six must be true, or the person counts as your worker.
Is the test different for construction?
Yes, it is stricter. For construction, electrical, and plumbing work, on top of the business elements the person must hold a valid contractor registration or trade license and a real place of business.
Can I be billed for a subcontractor's workers comp?
Yes. A prime contractor is primarily responsible for premiums on a subcontractor's work unless the sub is registered or licensed, runs its own business, and has an active state account you verified within the past year.
How do I protect myself when hiring a sub?
Before work starts, confirm the sub holds a valid contractor registration and an active Labor and Industries account in good standing, and keep the record. That verification is what relieves you of the sub's premium.
Does a signed contract calling someone a contractor settle it?
No. Washington looks at the actual arrangement against the legal test, not the label on the contract. A person can be your covered worker even with a 1099 and a contract that calls them independent.
What does workers comp not cover for these workers?
The state fund pays medical care and lost wages for a covered worker's injury, but it does not defend you in a lawsuit. Stop-gap employers liability added to your general liability policy covers that defense.
Why Washington owners choose Morrow
- We shop the right market for you. In Washington, workers' compensation is sold only through the state fund at the Department of Labor and Industries (L&I), with no private carriers to shop, so we help you open and run your L&I account correctly and place the stop-gap employers liability and other business coverages the state fund does not include.
- We catch pricing mistakes. Your price depends heavily on the category your work falls into for pricing (the class code). Put people in the wrong category and you overpay for years. We review your payroll and classifications before you buy.
- Proof of coverage, fast. Need a certificate (proof of coverage) for a general contractor or a landlord before Monday? We turn those around the same business day for most carriers.
- We help lower the score that drives your price. Insurers give you a score based on your past claims that raises or lowers your cost (the experience modification rate). We review it each year, flag errors, and connect you with return-to-work and safety resources that bring it down.
- Real people when a claim happens. When someone gets hurt, we stay involved through the life of the claim, not just at renewal.
Related Washington guides
Every Washington business is set up a little differently. These companion guides answer the same question for other situations, plus the national explainers behind the terms used here.
- Business insurance in Washington (start here)
- Workers comp: the owner's overview
- I own an LLC: do I need workers comp?
- I'm a sole proprietor: do I need workers comp?
- I own a corporation (C-corp or S-corp): do I need it?
- We're a partnership: do we need workers comp?
- We're a nonprofit: do we need workers comp?
- Only part-time or seasonal staff: do I need it?
- I only employ family: do I need workers comp?
- Remote or out-of-state staff: do I need coverage?
- What happens if I don't carry workers comp?
- How much does workers comp cost?
- How do I get workers comp (even if turned down)?
- What insurance do I need for a contractor license?
- Workers compensation insurance, explained
- What workers comp costs (national guide)
- Do I need workers comp for 1099 contractors?
- What workers comp does not cover
- Washington contractor workers comp
This guide is general information, not legal advice. Washington rules and penalty amounts can change, so verify current requirements with the Washington State Department of Labor and Industries (L&I) or a licensed advisor before you rely on them. Last updated: July 2026.