A Tennessee court says calling your worker a contractor doesn’t mean you can skip workers’ comp - especially when you’re the one controlling how they work.
On July 11, 2025, the Tennessee Workers’ Compensation Appeals Board upheld an earlier ruling that SageHome, LLC – doing business as New Bath Today – must provide medical treatment to Julia Havey, a salesperson injured while on a sales call. At issue was whether Havey was truly an independent contractor or actually an employee entitled to workers’ compensation.
The company had denied her claim, leaning heavily on a signed agreement from May 3, 2023, titled “Sales Representative Agreement (Independent Contractor).” The contract stated she was a “direct seller” under the tax code and wouldn’t be treated as an employee for employment tax purposes. It also said SageHome had “no duty to supervise” her, and that she could hire helpers or work elsewhere, as long as it wasn’t for a competitor.
But the Appeals Board didn’t stop at the contract. Instead, it looked closely at how the relationship worked in real life.
Havey testified that she had to attend a two-week training in Indiana, using her own transportation. Although the company paid for the hotel initially, she said $1,000 was later taken out of her pay to cover it. She also had to memorize and follow a sales script, use a company app installed on her personal phone and tablet – at her own expense – and carry around 45 pounds of branded marketing materials to every appointment.
Each night, she received her leads through the app, which gave her up to three appointments a day, scheduled by the company. Some days were light, others long – she described one 15-hour day traveling across Tennessee and Kentucky. Even on days without appointments, she said she was expected to remain on standby. Supervisors monitored her calls and expected immediate responses between 8 a.m. and 4 p.m. There were mandatory weekly meetings, and she testified that when she took time off for her father’s passing or her grandchild’s birth, her supervisor threatened termination.
She fell on March 6, 2024, while heading to an appointment. She had the materials in hand, wasn’t allowed in the customer’s home, and slipped on the sidewalk. Pain started in her ankle but later included her back, hip, and shoulder. She eventually got an MRI – on her own – that revealed a tear in her shoulder. When SageHome denied coverage, she filed for benefits.
The trial court found her credible and ruled that she was likely to prove employee status at trial. It ordered SageHome to provide her a panel of orthopedic specialists, though denied temporary disability benefits due to lack of evidence of work restrictions.
SageHome appealed, but the Appeals Board backed the lower court. Despite the contract’s wording, the court found that SageHome had significant control over Havey’s work. The takeaway? Labels in a contract don’t outweigh what’s happening on the ground.
For insurers and risk managers, this is a reminder: don’t assume that contractor status shields your clients from comp liability. If the setup looks like employment, the law may treat it that way.
