Club volleyball coaches and Officials are usually independent contractors paid by clubs or associations. This employment structure helps clubs stretch their budget and gives staff members certain freedoms. It’s crucial to understand the distinction between employees and contractors. Employees are required to meet specific work requirements and have rights to certain benefits. Workers’ compensation is one such benefit, and not insuring eligible workers can cost you.

Let’s understand the difference between independent contractors and employees’ and how that impacts workers’ compensation benefits for your club staff.

THE COST OF MISCLASSIFICATION
Employee misclassification is gaining a lot of attention these days, and businesses that get it wrong are subject to steep penalties. So, how can you make sure you’re properly classifying club personnel?
Let’s take a look at the different work requirements between independent contractors and employees.
Independent contractors can:
  • Set their own hours
  • Use their own tools
  • Have control over how tasks are performed
  • Work based on contracts
Employees are typically:
  • Paid by the hour or by salary, and have taxes withheld
  • Directed on the work and what processes to follow
  • Required to work a specific schedule
  • Dependent on the position as a main source of income
Businesses that misclassify employees as independent contractors can face serious legal and financial consequences, including requirements to pay back employment taxes and wages owed to employees. In some cases, employers even have to pay criminal penalties or face lawsuits related to on-the-job injuries.
UNDERSTANDING WORKERS’ COMPENSATION INSURANCE
Workers’ compensation is a type of insurance coverage that pays for costs related to on-the-job injuries. It pays for medical expenses, lost wages, and ongoing care costs (such as physical therapy or surgeries) related to injuries sustained by an employee while performing work duties.
Some club personnel, such as coaches and refs, are exposed to a range of hazards during practice, games, and events. Both types of professionals are in close contact with players, making them subject to collisions with athletes or impact from a stray ball. Falls from such incidents can lead to broken bones or other serious injuries, and head impacts can cause concussions. Moreover, recent reports of aggressive spectators and even freak accidents raise questions about safety during youth sports events.
For example, when a parent shoved teen refs to the ice during a youth hockey game, a young referee’s head hit the ice resulting in a potential concussion. During a youth baseball game in Texas, a coach suffered a bullet wound from a stray bullet fired on a nearby property. While the perpetrators in both of these cases are subject to criminal penalties, organizations could still be held liable for covering unpaid medical costs. If these officials were classified as employees, workers’ comp would cover medical costs and a portion of lost wages while they recover from their injuries.
Workers’ compensation insurance is regulated on the state level, which means requirements and penalties vary from state to state. Some states have severe penalties for not carrying workers’ comp insurance, and others have specific requirements for where you can purchase workers’ comp coverage. These differences can make it even more challenging to determine whether you are correctly classifying club officials and if you are responsible for having workers’ compensation insurance. The JVA has helpful information about the Classification of Employees and Staff that can help guide you as well.
If you’re unsure of whether you have the right insurance coverage in place, an insurance advisor with experience in the youth sports industry can help assess your unique situation given your state, club dynamics, and personnel structure. In general, workers’ compensation is a unique coverage within your overall insurance portfolio and warrants a close eye by a professional who understands your business and can guide you accordingly to ensure you meet all state requirements. Having all personnel classified accurately and workers’ comp coverage per your state’s specifications in place will help avoid penalties and lawsuits.
Club Official Safety Tip
Conduct an assessment to identify employees vs independent contractors
Misclassifying employees as independent contractors can lead to significant financial losses if they get injured while performing club duties. This fact sheet, provided by the U.S. Department of Labor, describes the differences between employees and independent contractors with examples to help you accurately classify and provide for club personnel.

Check out more Business Solutions for Club Directors.

About the Author
Brad Preston is a client advisor at World Insurance Associates (World) specializing in the Sports industry. Prior to World, he spent more than 20 years at Advanced Event Systems and SportsEngine where he worked closely with the JVA and other member clubs in the volleyball space. He is well versed in club operations, staff, and member management, and most importantly, the use of technology and its inherent cyber risks. The JVA and World have partnered together to bring JVA Members educational articles and content to help you learn about your unique cyber risks and exposures, and how to better protect your businesses, members, and families in general. Feel free to reach out to Brad directly with any questions at bradpreston@worldinsurance.com