If an employee of a direct farm business is injured, the injured employee can seek compensation in two ways.  First, the employee can sue the employer under a tort law theory of liability for an employer's negligent or intentional act (see employee liability).  An employer's business insurance policy may cover the liability stemming from such a suit.  

In the alternative, a direct farm business can voluntarily elect to participate in a workers' compensation program as provided for by the Illinois Workers' Compensation Act.  This insurance is costly, however.  In some cases such coverage is mandatory, but an "agricultural enterprise" is exempt from participating in the workers' compensation program if it employs less than 400 working days of agricultural labor per quarter in any quarter in the preceding year, excluding family members (820 ILCS § 305/3(19)). 

It is unclear, however, the extent to which some aspects of a direct farm marketing operation would fall under the "agricultural enterprise" exception.  If a court held that the direct farm business was liable for an employee's claim and that the operation was required to carry workers' compensation insurance, and the operation had not maintained workers' compensation insurance, the direct farm business would be liable for the workers' compensation benefits.  It is likely that the operation's insurance policy would not cover such a liability.  Therefore, if any of the operation's employees engage in activities that would not qualify as a traditional farming activity (e.g., processing food), or if the employee's time is divided between agricultural and non-agricultural activities, the direct farm business should consult an attorney to determine the applicability of the Illinois Workers' Compensation Act.  

If an employee of a direct farm business contracts a disease arising out of his/her employment, or a disease that becomes aggravated and disabling as a result of the exposure of the employment, he/she may seek compensation from the employer under the provisions of the Illinois Workers' Occupational Disease Act.  The same ability of the employer to elect insurance and the same exemptions for agricultural enterprises as found in the Workers' Compensation Act apply to the Occupational Disease Act.

Continue to Employee Liability