For years, independent workers, especially contractors, have faced major challenges when injured on the job. Unlike full-time employees, independent contractors often work without workers’ compensation insurance coverage. If they get hurt, medical bills, lost wages and long-term financial strain fall on their shoulders.
In California alone, over 1.7 million people work as independent contractors, making the state one of the strongest economies in the nation. With no employer-provided insurance, a single injury can be physically and financially devastating. With this issue at hand, there has been a need for change. In 2025, California took a big step forward with Senate Bill 216.
“No employees” doesn’t mean “no coverage” anymore
Senate Bill 216 (SB 216) changes California’s rules for licensed contractors. Before, if contractors had no employees, workers’ compensation insurance was not necessary. That left many solo workers exposed. However, starting January 1, 2025, the changes in the Senate bill provide some level of protection.
Here is what workers need to know:
- Who is affected: SB 216 requires all licensed contractors to carry workers’ compensation insurance whether they have employees or not.
- What trades are included: The rule applies to certain high-risk classifications, like concrete (C-8), HVAC (C-20), asbestos abatement (C-22) and tree service (D-49). Now, it expands to cover all licensed contractors.
- Already in effect: Starting in 2023, contractors with renewal dates between January 1 and June 30 must show proof of insurance before renewing their license. Those renewing after June 30, 2023, had to file proof of coverage by July 1, 2023.
- Why this matters: It closes a loophole that left solo contractors without protection. If an injury happens on the job, they now have access to medical treatment and wage replacement.
- What happens if they do not comply: Contractors who do not carry the required insurance could lose their license or face penalties from the Contractors State License Board (CSLB).
The next wave takes effect on January 1, 2026, when all remaining contractor classifications will be required to have workers’ compensation coverage, even if they do not employ anyone. This law helps ensure independent workers get the support they need if something goes wrong.
Getting hurt at work is hard enough. Dealing with insurance, legal forms and lost income should not fall entirely on your shoulders, especially if you work alone. You are better off seeking legal guidance if you are unsure about your rights or need help filing a claim.
