BUILDERS IN COLORADO benefited from the prolific veto pen of Republican Gov. Bill Owens when he nixed a bill that builders say unfairly required independent contractors to carry workers' comp insurance.

Existing law requires general contractors to carry workers' comp insurance. For independent contractors, however, workers' comp is optional—and that's how the industry likes it. (Most builders are considered general contractors, while the subs who do the work on most projects for builders are independent contractors.)

Rob Nanfelt, government affairs director of the Colorado HBA, says that under the proposed legislation, independent contractors would have had to provide workers' comp insurance for themselves and any other independent contractor they might bring on to a job.

The HBA opposed the measure because it believed the added insurance costs would be passed on to the home builders, thus raising the cost of new housing. As the major property owners on many residential construction jobs, builders were also potentially liable to be hit with hefty $500-per-incident-per-day penalties for any independent contractor not carrying workers' comp insurance, says Nanfelt.

Independent contractors know best whether their work is hazardous enough to warrant workers' comp insurance, says Nanfelt. “Why should the state take away that choice?” he asks, adding that the bill unfairly singled out the construction industry.

According to The Denver Post, the bill was supported by the AFL-CIO, commercial builders, and the Workers' Compensation Coalition. The bill's supporters were looking to combat so-called labor brokers, companies that send undocumented immigrant labor to construction sites as independent contractors. Supporters claim that workers from labor brokers make below-union wages, don't get paid overtime, and aren't covered by workers' comp insurance.