A California workers comp exemption lets certain business owners legally go without workers’ compensation coverage on themselves — Sole proprietors with no employees are not required to cover themselves and can choose to buy coverage. General partners and LLC managing members may elect to be excluded with no ownership-percentage minimum.
Corporate officers and directors may elect out only if they own at least 10 percent of the issued stock, or at least 1 percent when a parent, grandparent, sibling, spouse or child owns at least 10 percent. Officers and directors must also have health insurance or a health care service plan. Trustees, and owner-practitioners of professional corporations who have health coverage, may also elect out.
There is no limit on how many officers can be excluded. Each excluded person must sign their own written waiver under penalty of perjury. Any business with 1 or more employees must still cover those employees. — while the law still requires coverage for employees once a business has 1 or more.
This guide explains who qualifies for the California workers comp exemption, the exact form, where to file it, what it costs, and what an exempt owner gives up. Verified against California sources as of October 2026.
California at a Glance
| Coverage required at | 1 employee(s) |
| Who may elect out | Sole proprietors with no employees are not required to cover themselves and can choose to buy coverage. General partners and LLC managing members may elect to be excluded with no ownership-percentage minimum. Corporate officers and directors may elect out only if they own at least 10 percent of the issued stock, or at least 1 percent when a parent, grandparent, sibling, spouse or child owns at least 10 percent. Officers and directors must also have health insurance or a health care service plan. Trustees, and owner-practitioners of professional corporations who have health coverage, may also elect out. There is no limit on how many officers can be excluded. Each excluded person must sign their own written waiver under penalty of perjury. Any business with 1 or more employees must still cover those employees. |
| Exemption form | NONE. There is no state-issued exemption form. Owner exclusion is a written waiver of workers’ compensation coverage, signed under penalty of perjury, on the insurer’s own form. Examples are State Fund form 10284 “Corporate Officers and Directors Waiver of Workers’ Compensation Coverage” and State Fund’s “LLC Managing Members Waiver of Workers’ Compensation Coverage.” Separately, licensed contractors with no employees file a “Certificate of Exemption from Workers’ Compensation Insurance” with the Contractors State License Board (CSLB). |
| Filed with | Officer, director, partner and LLC-member waivers go to the business’s workers’ comp insurer and attach to the policy (no filing with DWC). The insurer may backdate acceptance up to 15 days before it received the waiver. Contractors file their no-employee Certificate of Exemption with the CSLB (https://www.cslb.ca.gov). |
| Penalty for being uninsured | Labor Code 3710.1 allows a stop order that bars an uninsured employer from using employee labor until it gets coverage. Labor Code 3722(a): a penalty of 1500 per employee employed when the stop order is served, up to a maximum of 100000. Labor Code 3722(b): if uninsured for more than one week in the preceding calendar year, the greater of twice the premium that would have been paid or 1500 per employee employed during the uninsured period. Labor Code 3700.5: knowingly failing to secure coverage is a misdemeanor punishable by up to 1 year in county jail and/or a fine of up to double the premium but not less than 10000. A second conviction carries up to 1 year in county jail and/or a fine of triple the premium but not less than 50000, plus investigation costs. Injured workers of uninsured employers may be paid through the Uninsured Employers Benefit Trust Fund and may also sue the employer in civil court. |
In This California Guide:
Who Qualifies for A California Workers Comp Exemption
Sole proprietors with no employees are not required to cover themselves and can choose to buy coverage. General partners and LLC managing members may elect to be excluded with no ownership-percentage minimum. Corporate officers and directors may elect out only if they own at least 10 percent of the issued stock, or at least 1 percent when a parent, grandparent, sibling, spouse or child owns at least 10 percent.
Officers and directors must also have health insurance or a health care service plan. Trustees, and owner-practitioners of professional corporations who have health coverage, may also elect out. There is no limit on how many officers can be excluded. Each excluded person must sign their own written waiver under penalty of perjury. Any business with 1 or more employees must still cover those employees.
Cal. Labor Code 3351(c) and 3352, as amended by SB 189 (applies to policies effective 7/1/2018 and later). Officers and directors of a private corporation are employees by default. An officer or director may elect exclusion only by signing a written waiver under penalty of perjury that states they qualify.
To qualify they must own at least 10 percent of the issued and outstanding stock, or at least 1 percent if a parent, grandparent, sibling, spouse or child owns at least 10 percent. They must also be covered by a health insurance policy or health care service plan. Officers and directors of cooperative corporations must have health coverage plus a disability policy comparable to workers’ comp.
Under Labor Code 3351(f) and 3352(a)(17), working members of a partnership or LLC who receive wages regardless of profits are employees. A general partner or an LLC managing member may elect to be excluded by signing a written waiver under penalty of perjury. There is no ownership-percentage threshold, and each general partner or managing member signs their own waiver.
How to File the California Workers Comp Exemption
The form is NONE. There is no state-issued exemption form. Owner exclusion is a written waiver of workers’ compensation coverage, signed under penalty of perjury, on the insurer’s own form.
Examples are State Fund form 10284 “Corporate Officers and Directors Waiver of Workers’ Compensation Coverage” and State Fund’s “LLC Managing Members Waiver of Workers’ Compensation Coverage.” Separately, licensed contractors with no employees file a “Certificate of Exemption from Workers’ Compensation Insurance” with the Contractors State License Board (CSLB)..
It is filed with Officer, director, partner and LLC-member waivers go to the business’s workers’ comp insurer and attach to the policy (no filing with DWC). The insurer may backdate acceptance up to 15 days before it received the waiver. Contractors file their no-employee Certificate of Exemption with the CSLB (https://www.cslb.ca.gov)..
Filing on the state’s own site costs nothing beyond any statutory fee — the “exemption filing services” that advertise on this search charge for the same form.
California Workers Comp Exemption Rules at a Glance
The exact California workers comp exemption rules every owner should check before deciding to go without coverage:
| Employee threshold | 1 |
| Who may elect out | Sole proprietors with no employees are not required to cover themselves and can choose to buy coverage. General partners and LLC managing members may elect to be excluded with no ownership-percentage minimum. Corporate officers and directors may elect out only if they own at least 10 percent of the issued stock, or at least 1 percent when a parent, grandparent, sibling, spouse or child owns at least 10 percent. Officers and directors must also have health insurance or a health care service plan. Trustees, and owner-practitioners of professional corporations who have health coverage, may also elect out. There is no limit on how many officers can be excluded. Each excluded person must sign their own written waiver under penalty of perjury. Any business with 1 or more employees must still cover those employees. |
| Corporate officers | Cal. Labor Code 3351(c) and 3352, as amended by SB 189 (applies to policies effective 7/1/2018 and later). Officers and directors of a private corporation are employees by default. An officer or director may elect exclusion only by signing a written waiver under penalty of perjury that states they qualify. To qualify they must own at least 10 percent of the issued and outstanding stock, or at least 1 percent if a parent, grandparent, sibling, spouse or child owns at least 10 percent. They must also be covered by a health insurance policy or health care service plan. Officers and directors of cooperative corporations must have health coverage plus a disability policy comparable to workers’ comp. |
| LLC members and partners | Under Labor Code 3351(f) and 3352(a)(17), working members of a partnership or LLC who receive wages regardless of profits are employees. A general partner or an LLC managing member may elect to be excluded by signing a written waiver under penalty of perjury. There is no ownership-percentage threshold, and each general partner or managing member signs their own waiver. |
| Form | NONE. There is no state-issued exemption form. Owner exclusion is a written waiver of workers’ compensation coverage, signed under penalty of perjury, on the insurer’s own form. Examples are State Fund form 10284 “Corporate Officers and Directors Waiver of Workers’ Compensation Coverage” and State Fund’s “LLC Managing Members Waiver of Workers’ Compensation Coverage.” Separately, licensed contractors with no employees file a “Certificate of Exemption from Workers’ Compensation Insurance” with the Contractors State License Board (CSLB). |
| Where to file | Officer, director, partner and LLC-member waivers go to the business’s workers’ comp insurer and attach to the policy (no filing with DWC). The insurer may backdate acceptance up to 15 days before it received the waiver. Contractors file their no-employee Certificate of Exemption with the CSLB (https://www.cslb.ca.gov). |
| Proof of exemption or coverage | A Certificate of Insurance from the carrier. Coverage can be checked with the Workers’ Compensation Insurance Rating Bureau (WCIRB) coverage inquiry, which is not a .gov site. Contractors’ workers’ comp or exemption status shows on the CSLB license lookup at https://www.cslb.ca.gov. An excluded owner’s status shows as a waiver endorsement on the policy. The state issues no exemption certificate for non-contractors. |
What A California Workers Comp Exemption Gives Up
An excluded owner, officer, partner or member gets no workers’ comp benefits from the policy if injured: no medical treatment, temporary or permanent disability pay, or death benefits through workers’ comp. They have to rely on their own health, disability and life insurance. Confirm with the state board and a licensed attorney how this affects any right to sue.
One honest paragraph on the “ghost policy”: a minimum-premium policy with no employees sold to owners who need a certificate of insurance. It is legal in many states, but it is not a California workers comp exemption — it is coverage with nobody on it. If you add a worker, it must be reported, or the audit will find them.
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Workers Exempt by Law in California
Separate from the owner’s election, California law exempts some classes of workers from coverage — commonly domestic workers below a threshold, casual labor, some farm labor and licensed real-estate agents paid by commission. A worker who does not fit a listed class counts toward the threshold, no matter what the 1099 says.
Proving A California Workers Comp Exemption or Coverage
A Certificate of Insurance from the carrier. Coverage can be checked with the Workers’ Compensation Insurance Rating Bureau (WCIRB) coverage inquiry, which is not a .gov site. Contractors’ workers’ comp or exemption status shows on the CSLB license lookup at https://www.cslb.ca.gov. An excluded owner’s status shows as a waiver endorsement on the policy. The state issues no exemption certificate for non-contractors.
Why the California Workers Comp Exemption Matters
The California workers comp exemption is a trade: lower cost today against no safety net if you are hurt. The second half of the trade is the one the search results never lead with. All roofing (C-39) contractors must carry workers’ comp even with no employees, and the coverage requirement extends to nearly all CSLB contractors on January 1, 2028 (SB 216 / SB 1455).
California presumes workers are employees under the ABC test (Labor Code 2775). There are separate exclusion rules for trustees, professional-corporation owner-practitioners (health coverage required) and cooperative-corporation officers (health plus disability coverage required). Coverage of household workers is often provided through a homeowner’s or renter’s policy. Confirm with the DWC and a licensed attorney before relying on any exclusion.
If the California workers comp exemption rules above leave any doubt about whether a worker counts, ask the state agency before you decide — the answer is free, and the penalty for guessing wrong is not.
Employer side: the California requirements guide covers the threshold, who counts and the penalties in full. Hurt while exempt? You may still have a claim against a third party — a licensed attorney can say.
Frequently Asked Questions
Who can file a workers comp exemption in California?
Sole proprietors with no employees are not required to cover themselves and can choose to buy coverage. General partners and LLC managing members may elect to be excluded with no ownership-percentage minimum. Corporate officers and directors may elect out only if they own at least 10 percent of the issued stock, or at least 1 percent when a parent, grandparent, sibling, spouse or child owns at least 10 percent.
Officers and directors must also have health insurance or a health care service plan. Trustees, and owner-practitioners of professional corporations who have health coverage, may also elect out. There is no limit on how many officers can be excluded. Each excluded person must sign their own written waiver under penalty of perjury. Any business with 1 or more employees must still cover those employees.
What form is the California workers comp exemption?
NONE. There is no state-issued exemption form. Owner exclusion is a written waiver of workers’ compensation coverage, signed under penalty of perjury, on the insurer’s own form.
Examples are State Fund form 10284 “Corporate Officers and Directors Waiver of Workers’ Compensation Coverage” and State Fund’s “LLC Managing Members Waiver of Workers’ Compensation Coverage.” Separately, licensed contractors with no employees file a “Certificate of Exemption from Workers’ Compensation Insurance” with the Contractors State License Board (CSLB).. File it on the state’s own site; filing services charge for the same form.
Can an exempt owner in California still collect benefits if hurt?
No. An exemption removes the owner from coverage, so there is no claim for medical care or lost wages. That is the trade.
Official California Sources & Resources
- California California Department of Industrial Relations, Division of Workers’ Compensation (DWC). Disputes go to the Workers’ Compensation Appeals Board (WCAB). Stop orders and uninsured-employer enforcement are handled by the Labor Commissioner (DLSE).: https://www.dir.ca.gov/dwc/
- California Workers’ Comp Statute: https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=LAB§ionNum=3351
- U.S. Department of Labor — Workers’ Comp: dol.gov
- Insurance Information Institute: iii.org
This California workers comp exemption guide was last verified against official California sources in October 2026. Rules change — confirm the current figure with the state agency or a licensed attorney.
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Disclaimer: This guide is informational only and is not legal, medical, or financial advice. Workers Comp Explained is an independent educational resource, not a law firm or insurer. Workers’ comp benefits, settlement values, deadlines, and requirements vary by state and by the specific facts of your injury and change over time, and any settlement figures here are illustrative only.
Confirm your rights and any deadline with your state’s workers’ compensation board and a licensed attorney before you act.