This question actually has more to do with general employment law than with Contruction law. You may want to repost it in the employment law section of the site (who will then probably tell you to re-post it over here!). That being said, the question is can you treat these "piece workers" as independent contractors. An anonymous call to Employment Development Department asking the question will, I would bet you money, confirm that the EDD would not consider these "piece workers" to really be employees and not contractors unless (1) they carry their own insurance, and (2) have their own contractor's license number. Without those two items, I believe you will find that EDD is going to consider your "piece workers" to be employees. As such, you would not only be required to carry worker's compensation insurance, but you would also be liable for withholding and paying all employment taxes on their wages. EDD is very fond of finding people to be employees, even where both parties agree that the worker is an independent contractor. There are a bunch of factors that EDD looks at, and I believe you can find them on their website, to determine if someone should be treated as an employee, or an independent contractor. Two of the factors are definitely do they carry their own insurance, and do they have a license.

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