An Oregon workers comp exemption lets certain business owners legally go without workers’ compensation coverage on themselves — Oregon does not use an exemption form. ORS 656.027 lists owners who are “nonsubject” (left out of coverage automatically). Sole proprietors are generally nonsubject, but if they work under contract they must meet Oregon’s independent-contractor test. Partners and LLC members are generally nonsubject.
Corporate officers are nonsubject only if they also sit on the board of directors and have a substantial ownership interest, regardless of the work they do. “Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less. Construction and landscape firms licensed under ORS 701.021 or 671.525 face extra limits (see officer_rule and llc_partner_rule).
Any nonsubject owner can choose to be covered (ORS 656.039; ORS 656.128). — while the law still requires coverage for employees once a business has 1 or more. This guide explains who qualifies for the Oregon workers comp exemption, the exact form, where to file it, what it costs, and what an exempt owner gives up. Verified against Oregon sources as of October 2026.
Oregon at a Glance
| Coverage required at | 1 employee(s) |
| Who may elect out | Oregon does not use an exemption form. ORS 656.027 lists owners who are “nonsubject” (left out of coverage automatically). Sole proprietors are generally nonsubject, but if they work under contract they must meet Oregon’s independent-contractor test. Partners and LLC members are generally nonsubject. Corporate officers are nonsubject only if they also sit on the board of directors and have a substantial ownership interest, regardless of the work they do. “Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less. Construction and landscape firms licensed under ORS 701.021 or 671.525 face extra limits (see officer_rule and llc_partner_rule). Any nonsubject owner can choose to be covered (ORS 656.039; ORS 656.128). |
| Exemption form | NONE. Oregon has no state exemption or exclusion form, and nonsubject status comes straight from the statute. Corporate officers make their exempt designation in writing to their insurer, using the insurer’s own form (SAIF, for example, has Form X3267). Choosing coverage for a nonsubject person is done by written notice to the insurer (ORS 656.039). Construction contractors choose “Exempt (no employees)” or “Nonexempt” status with the CCB on its Workers Compensation Status Change Form. |
| Filed with | Corporate officer designations and elections to be covered go to the workers’-comp insurer, with a copy to the DCBS Director for carrier-insured elections under ORS 656.039. Self-insured employers file with the DCBS Director. Construction contractors file their exempt or nonexempt status with the Oregon Construction Contractors Board: https://www.oregon.gov/ccb/licensing/Pages/workers-comp.aspx (form: https://www.oregon.gov/ccb/Documents/Workers%20Compensation%20Change.pdf). |
| Renewal | NONE. Nonsubject status comes from the statute and lasts as long as the owner still meets the conditions. Those conditions include ownership percentage, director status, no employees, family makeup, and independent-contractor status. A contractor must update its CCB status if it changes, for example when it hires employees (ORS 701.035; OAR 812-003-0321). An election to be covered can be canceled by written notice to the insurer, or to the Director if self-insured. The cancellation takes effect at midnight on the day the notice is received, unless the notice gives a later date (ORS 656.039). |
| Penalty for being uninsured | ORS 656.735: an employer who violates ORS 656.052 (operating without required coverage) faces a civil penalty of up to 1000 or twice the premium that would have been due for the period without coverage, whichever is greater. If the violation continues after the order becomes final, the penalty is up to 250 for each day. Corporate officers and directors, LLC members and managers, and partners are jointly and severally liable (each can be held responsible for the full amount) for penalties and claim costs. The noncomplying employer is also liable for the costs of an injured worker’s claim (ORS 656.054). The Director can also order the employer to stop using workers until it has coverage (ORS 656.052). |
In This Oregon Guide:
Who Qualifies for An Oregon Workers Comp Exemption
Oregon does not use an exemption form. ORS 656.027 lists owners who are “nonsubject” (left out of coverage automatically). Sole proprietors are generally nonsubject, but if they work under contract they must meet Oregon’s independent-contractor test. Partners and LLC members are generally nonsubject. Corporate officers are nonsubject only if they also sit on the board of directors and have a substantial ownership interest, regardless of the work they do.
“Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less. Construction and landscape firms licensed under ORS 701.021 or 671.525 face extra limits (see officer_rule and llc_partner_rule). Any nonsubject owner can choose to be covered (ORS 656.039; ORS 656.128).
ORS 656.027: A corporate officer who is also a director and has a substantial ownership interest is nonsubject, regardless of the work they do. “Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less.
For corporations licensed under ORS 701.021 (construction) or 671.525 (landscape), the number of exempt officers is capped at 2, or 1 for every 10 corporate employees, whichever is greater. The cap does not apply if all officers are from the same family: parents, spouses, sisters, brothers, daughters, sons, daughters-in-law, sons-in-law or grandchildren. In that case all of them may elect to be nonsubject.
The corporation designates in writing to its insurer which eligible officers are exempt.
ORS 656.027: Partners and LLC members (including managers) are generally nonsubject, regardless of the work they do. A partnership working under contract must qualify as an independent contractor for its partners to be nonsubject. Partners doing construction work on real property are treated differently. Partners and LLC members of firms licensed under ORS 701.021 (construction) or 671.525 (landscape) are nonsubject if they have a substantial ownership interest.
If all partners or members are from the same family (same family list as for officers), all of them may elect to be nonsubject. Any of them may apply in writing to an insurer to be covered (ORS 656.128).
How to File the Oregon Workers Comp Exemption
The form is NONE. Oregon has no state exemption or exclusion form, and nonsubject status comes straight from the statute. Corporate officers make their exempt designation in writing to their insurer, using the insurer’s own form (SAIF, for example, has Form X3267). Choosing coverage for a nonsubject person is done by written notice to the insurer (ORS 656.039).
Construction contractors choose “Exempt (no employees)” or “Nonexempt” status with the CCB on its Workers Compensation Status Change Form.. It is filed with Corporate officer designations and elections to be covered go to the workers’-comp insurer, with a copy to the DCBS Director for carrier-insured elections under ORS 656.039. Self-insured employers file with the DCBS Director.
Construction contractors file their exempt or nonexempt status with the Oregon Construction Contractors Board: https://www.oregon.gov/ccb/licensing/Pages/workers-comp.aspx (form: https://www.oregon.gov/ccb/Documents/Workers%20Compensation%20Change.pdf).. Renewal: NONE. Nonsubject status comes from the statute and lasts as long as the owner still meets the conditions. Those conditions include ownership percentage, director status, no employees, family makeup, and independent-contractor status. A contractor must update its CCB status if it changes, for example when it hires employees (ORS 701.035; OAR 812-003-0321).
An election to be covered can be canceled by written notice to the insurer, or to the Director if self-insured. The cancellation takes effect at midnight on the day the notice is received, unless the notice gives a later date (ORS 656.039).. 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.
Oregon Workers Comp Exemption Rules at a Glance
The exact Oregon workers comp exemption rules every owner should check before deciding to go without coverage:
| Employee threshold | 1 |
| Who may elect out | Oregon does not use an exemption form. ORS 656.027 lists owners who are “nonsubject” (left out of coverage automatically). Sole proprietors are generally nonsubject, but if they work under contract they must meet Oregon’s independent-contractor test. Partners and LLC members are generally nonsubject. Corporate officers are nonsubject only if they also sit on the board of directors and have a substantial ownership interest, regardless of the work they do. “Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less. Construction and landscape firms licensed under ORS 701.021 or 671.525 face extra limits (see officer_rule and llc_partner_rule). Any nonsubject owner can choose to be covered (ORS 656.039; ORS 656.128). |
| Corporate officers | ORS 656.027: A corporate officer who is also a director and has a substantial ownership interest is nonsubject, regardless of the work they do. “Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less. For corporations licensed under ORS 701.021 (construction) or 671.525 (landscape), the number of exempt officers is capped at 2, or 1 for every 10 corporate employees, whichever is greater. The cap does not apply if all officers are from the same family: parents, spouses, sisters, brothers, daughters, sons, daughters-in-law, sons-in-law or grandchildren. In that case all of them may elect to be nonsubject. The corporation designates in writing to its insurer which eligible officers are exempt. |
| LLC members and partners | ORS 656.027: Partners and LLC members (including managers) are generally nonsubject, regardless of the work they do. A partnership working under contract must qualify as an independent contractor for its partners to be nonsubject. Partners doing construction work on real property are treated differently. Partners and LLC members of firms licensed under ORS 701.021 (construction) or 671.525 (landscape) are nonsubject if they have a substantial ownership interest. If all partners or members are from the same family (same family list as for officers), all of them may elect to be nonsubject. Any of them may apply in writing to an insurer to be covered (ORS 656.128). |
| Workers exempt by law | ORS 656.027 nonsubject classes include: (1) Domestic servants in or about a private home, meaning household domestic service under a private employment contract, including home health workers. (2) Casual workers, where the work is either outside the employer’s trade or business or done for a nonsubject employer. “Casual” means total labor cost in any 30-day period below the threshold, no matter how many workers. The statutory base is 500 and it is adjusted every July 1 by the state average weekly wage change. For July 1, 2026 to June 30, 2027 the threshold is 1198.22 (WCD Bulletin 387). (3) Real estate brokers paid for professional real estate activity who qualify under ORS 316.209 (ORS 656.037). (4) Genuine independent contractors (ORS 670.600 and ORS 656.005). Agricultural workers have no general exemption in Oregon. Every worker is a subject worker unless a specific statutory exemption applies. |
| Form | NONE. Oregon has no state exemption or exclusion form, and nonsubject status comes straight from the statute. Corporate officers make their exempt designation in writing to their insurer, using the insurer’s own form (SAIF, for example, has Form X3267). Choosing coverage for a nonsubject person is done by written notice to the insurer (ORS 656.039). Construction contractors choose “Exempt (no employees)” or “Nonexempt” status with the CCB on its Workers Compensation Status Change Form. |
| Where to file | Corporate officer designations and elections to be covered go to the workers’-comp insurer, with a copy to the DCBS Director for carrier-insured elections under ORS 656.039. Self-insured employers file with the DCBS Director. Construction contractors file their exempt or nonexempt status with the Oregon Construction Contractors Board: https://www.oregon.gov/ccb/licensing/Pages/workers-comp.aspx (form: https://www.oregon.gov/ccb/Documents/Workers%20Compensation%20Change.pdf). |
| Renewal | NONE. Nonsubject status comes from the statute and lasts as long as the owner still meets the conditions. Those conditions include ownership percentage, director status, no employees, family makeup, and independent-contractor status. A contractor must update its CCB status if it changes, for example when it hires employees (ORS 701.035; OAR 812-003-0321). An election to be covered can be canceled by written notice to the insurer, or to the Director if self-insured. The cancellation takes effect at midnight on the day the notice is received, unless the notice gives a later date (ORS 656.039). |
| Proof of exemption or coverage | Oregon issues no state exemption certificate. Coverage can be checked on the WCD Proof of Coverage Search at https://www4.cbs.state.or.us/exs/wcd/cov/ (via https://wcd.oregon.gov/employer/coverage/Pages/proof-of-coverage.aspx). Certified coverage records are available from the WCD Employer Compliance Unit at 888-877-5670, or through its coverage certification request page. Insured employers give a certificate of insurance from their insurer. Construction contractors’ exempt or nonexempt status shows on their CCB license record. |
What An Oregon Workers Comp Exemption Gives Up
A nonsubject owner generally gets no Oregon workers’-comp benefits if injured on the job. That includes medical bills, time-loss pay and disability benefits, unless the owner has chosen coverage under ORS 656.039 or ORS 656.128. Any claim would have to go through private health or disability insurance. Confirm effects on liability and the right to sue with the Oregon WCD and a licensed attorney.
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 an Oregon 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.
Workers Exempt by Law in Oregon
ORS 656.027 nonsubject classes include: (1) Domestic servants in or about a private home, meaning household domestic service under a private employment contract, including home health workers. (2) Casual workers, where the work is either outside the employer’s trade or business or done for a nonsubject employer. “Casual” means total labor cost in any 30-day period below the threshold, no matter how many workers.
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The statutory base is 500 and it is adjusted every July 1 by the state average weekly wage change. For July 1, 2026 to June 30, 2027 the threshold is 1198.22 (WCD Bulletin 387). (3) Real estate brokers paid for professional real estate activity who qualify under ORS 316.209 (ORS 656.037). (4) Genuine independent contractors (ORS 670.600 and ORS 656.005). Agricultural workers have no general exemption in Oregon.
Every worker is a subject worker unless a specific statutory exemption applies.
Proving An Oregon Workers Comp Exemption or Coverage
Oregon issues no state exemption certificate. Coverage can be checked on the WCD Proof of Coverage Search at https://www4.cbs.state.or.us/exs/wcd/cov/ (via https://wcd.oregon.gov/employer/coverage/Pages/proof-of-coverage.aspx). Certified coverage records are available from the WCD Employer Compliance Unit at 888-877-5670, or through its coverage certification request page. Insured employers give a certificate of insurance from their insurer. Construction contractors’ exempt or nonexempt status shows on their CCB license record.
Why the Oregon Workers Comp Exemption Matters
The Oregon 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. (1) Construction and landscape firms licensed under ORS 701.021 or 671.525 face the exempt-officer cap and the same-family rule. They must also hold an Exempt or Nonexempt workers’-comp status on their CCB license.
(2) A corporation claiming exempt status with the CCB must provide its combined Oregon Employment Department/Department of Revenue business ID number, unless it certifies its officers receive no salary or profit from it. (3) The casual-labor dollar threshold is adjusted every July 1 (1198.22 for July 1, 2026 to June 30, 2027). (4) SAIF Corporation is a competitive state fund, not a monopoly.
Confirm specifics with the Oregon WCD and a licensed attorney. If the Oregon 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 Oregon 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 Oregon?
Oregon does not use an exemption form. ORS 656.027 lists owners who are “nonsubject” (left out of coverage automatically). Sole proprietors are generally nonsubject, but if they work under contract they must meet Oregon’s independent-contractor test. Partners and LLC members are generally nonsubject. Corporate officers are nonsubject only if they also sit on the board of directors and have a substantial ownership interest, regardless of the work they do.
“Substantial ownership” means at least the average percentage held by all owners, or 10 percent, whichever is less. Construction and landscape firms licensed under ORS 701.021 or 671.525 face extra limits (see officer_rule and llc_partner_rule). Any nonsubject owner can choose to be covered (ORS 656.039; ORS 656.128).
What form is the Oregon workers comp exemption?
NONE. Oregon has no state exemption or exclusion form, and nonsubject status comes straight from the statute. Corporate officers make their exempt designation in writing to their insurer, using the insurer’s own form (SAIF, for example, has Form X3267). Choosing coverage for a nonsubject person is done by written notice to the insurer (ORS 656.039).
Construction contractors choose “Exempt (no employees)” or “Nonexempt” status with the CCB on its Workers Compensation Status Change Form.. File it on the state’s own site; filing services charge for the same form.
Can an exempt owner in Oregon 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 Oregon Sources & Resources
- Oregon Oregon Department of Consumer and Business Services, Workers’ Compensation Division (WCD): https://wcd.oregon.gov/
- Oregon Workers’ Comp Statute: https://www.oregonlegislature.gov/bills_laws/ors/ors656.html (ORS 656.027, 656.039, 656.128, 656.735)
- U.S. Department of Labor — Workers’ Comp: dol.gov
- Insurance Information Institute: iii.org
This Oregon workers comp exemption guide was last verified against official Oregon 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.