Contractors, subcontractors and section 440.10

By Adrian Middleton, Sword & Shield, PLLC · Updated Friday, October 9, 2026

The statutory employer rule

Section 440.10(1)(b): when a contractor sublets any part of its contract work to a subcontractor, all employees of the contractor and the subcontractors on that work are deemed employed in one business, and the contractor is liable for, and must secure, compensation for all of them, except employees of a subcontractor that has secured its own coverage. If the sub has no policy, the sub's workers are the contractor's employees for every purpose in Chapter 440, including section 440.107.

The duty to collect evidence

Section 440.10(1)(c) requires a contractor to require a subcontractor to provide evidence of workers' compensation insurance, and requires a subcontractor whose officer is exempt to provide a copy of the exemption certificate to the contractor. Rule 69L-6.032 spells out what counts: a certificate of insurance or the policy's information page for an insured sub, or a copy of the certificate of election to be exempt for each exempt officer, obtained before the work began and kept with the records. A contractor that cannot produce that evidence in response to a records request is treated as having employed the sub's workers.

What investigators do

When an uninsured crew is found on a site, the investigator identifies the general contractor from the permit and serves a records request on the general for every payment to that sub. The sub gets the order; the general gets the audit. Where the sub's exemption is invalid, or the sub had helpers of its own, the general's penalty is calculated on everything the general paid the sub, at the sub's class code.

Protecting the contractor

• Collect a certificate of insurance before the sub starts, directly from the agent, and verify the policy on the Division's proof-of-coverage database.
• Collect exemption certificates for every officer of an exempt sub and confirm on the Division's database that each is current and names that entity.
• Ask the exempt sub, in writing, whether it has any employees. If yes, it needs a policy.
• Register with the sub's carrier under section 440.05(7) to receive notice of cancellation.
• Keep the evidence with the payment records for the period Rule 69L-6.015 requires.
• Put the sub's indemnity and coverage obligations in the subcontract: section 440.10(1)(d) lets a contractor that becomes liable recover benefits paid from the sub, with interest.

Subcontractor protections

Section 440.10(1)(e) protects a subcontractor that has its own coverage from liability for the employees of other subs or the general on the same project, and preserves its exclusive-remedy immunity, provided its own gross negligence was not the major contributing cause of an injury.

Questions