I just retired from the Marine Corps and will going to work for my FIL in the general contracting/remodeling business. I’m 32 BTW.

He’s been a 1 man show for 31 years and is worried if I’m an employee then he will have to pay workman’s comp insurance.

He mentioned me starting my own contracting company and mostly “subbbing for him”.

Basically, I don’t need insurance (retired and Tricare for life) and we both really want this to work. He’s one of the best around and I’m the hard working type who is first on the job site everyday.

What’s the best route to proceed in this state?

All suggestions are appreciated

Talk to the state, but if he hires you as an independent contractor and not an employee I think you can forgo the insurance. People you work for on their site may require insurance or a waiver though.

I have been a roofing contractor for 21 years (this February).

If you are an "employee" he is required to pay workers compensation on your wages. General contracting is approximately 25% of payroll meaning for every $100 you earn, your employer pays $25 to his WC insurance.

Don't forget federal taxes for employees, state taxes for employees, unemployment taxes for employees.

Also his general liability insurance may or may not be based on pay roll. Some general liability insurances are based on pay roll, others (usually in Illinois) based on revenue.

It is illegal to classify an employee as a 1099 independent contractor, but honestly nearly all of the small contractors in the entire nation do pay their employees like they were contractors. However this only relieves the employers tax burden. It doesn't relieve them from having to pay comp. If your father in law were to hire uninsured sub contractors now, and doesn't lie during his annual audit, he will have to pay workers compensation on those sub contractors. So even if you are an independent contractor, he will pay comp on your wages.

The only sorta-legal way I am aware of for him to avoid paying workers compensation on your earnings would be for you to become a sub contractor. Not an independent contractor, but a sub contractor. You would start your own business and get your own insurance policies.  He would then not be hiring YOU, but hiring the company that you own.

Keep in mind workers compensation is not health insurance. It is so you don't have to use your health insurance should you be injured on the job and is required by law for anyone who has employees.  You should also check with your existing health insurance to see if it covers you for on the job injuries, not all of them do!

Even if you are an independent contractor and working for him you will need workman’s comp.  you will have to purchase your own policy, but he will be required to show that any independent contractor he contracts with has a vailid policy.