Oregon

The state of Oregon requires almost all employers to carry workers compensation insurance on their employees; therefore if your business has employees you are required to provide them with coverage.

There are no numerical exemptions from workers compensation insurance in Oregon; however the following type of workers may be exempt:

Sole proprietors.

• Partners, with decision making rights to the business. In construction, partners that may be exempt may not be more than two with the exemption of family members.
• Private residence workers that work within a home to provide services such as cleaning, in-home health care, gardening, home maintenance, etc. Workers involved in the construction a new home would not be exempt.
• Casual labor, which is defined as labor resulting in any total payroll less than $500 in a 30-day period. If payroll for laborers does reach $500 within the 30-day period, coverage will be required.
• Corporate officers, only if they serve on the board of directors and own a minimum of 10% of the stock or any amount equivalent to the average held by the stockholders. Construction companies that are incorporated have a limit of two exempt officers, however if the companies are family-run they may be permitted additional exempt officers.
• Limited liability company members are mostly exempt. In the construction industry, all family members are exempt. If they are not family, construction exemptions are limited to two members or one per every 10 employees. These members must have substantial company ownership.
• Any partners, sole proprietors, limited liability companies, or corporations working under contract, who also qualify as independent contractors.
• Out-of-state workers who temporarily work in Oregon if they do not use Oregon workers while in-state, have polices in their home-state that cover temporary assignment workers in Oregon, and a home-state that recognizes an Oregon employer’s coverage.

If you employ an individual that you believe to be an independent contractor but they later determined to be an employee, then you are responsible for providing workers compensation insurance coverage. To be considered an Independent Contractor under Oregon State Law you must be:

• Free from direction and control
• Licensed under Construction Contractors Board, State Landscape Architect Board, State Landscape Contractors Board or State Board of Architect Examiners, if required for service
• Responsible for other licenses or certificates needed to do the work

For more information, visit www.independentcontractors.com.

If you fail to provide the required coverage, WCD will send out an order stating the period of noncompliance and fine. First offense penalties are equal to two times the premium that was not paid with a minimum fine of $1,000. If you continue to conduct business without coverage, this penalty increases to $250 per day with no limits to the total fine. WCD has the right to request a permanent court injunction, if you disobey this injunction it is considered contempt of court and may bring additional sanctions not excluding jail time.

In addition, any expenses resulting from an on-the-job injury could cost you even more than WCD penalties. Any employer who is noncompliant is also considered financially responsible for the benefits a worker would have collected with coverage. This also includes being responsible for the processing fees for a certified claims examiner who must process any claim.

A business that subcontracts is deemed the "prime contractor" and is responsible for making sure that all subcontractors have workers compensation coverage at the start of a project. If this is not done and work is preformed without proper coverage you will be considered non-compliant.