Oregon workers’ compensation insurance: A must-know guide for employers

Which employers in Oregon must carry workers’ compensation insurance?

Nearly all employers with one or more employees in Oregon, whether full-time or part-time, must have workers’ compensation insurance. Businesses with only independent contractors do not need to carry workers’ comp, but they can if they want to. In the latter case, the employer must ensure the independent contractors legally qualify as such.

Certain types of employees in Oregon are exempt from workers’ compensation coverage.

The most common exemptions are as follows:

• Partners who are acknowledged as “active” partners and participate in making substantial business decisions.
• Casual labor, meaning labor costing less than a specific amount within a 30-day period ($1,091.84, effective July 1, 2024).
• Corporate officers who serve on the board of directors and hold a minimum of 10-percent stock ownership.
• Most members of limited liability companies (LLCs).
• Certain out-of-state employees temporarily working in Oregon.

To determine whether you must carry workers’ compensation insurance, ask yourself:

• Am I an employer, as defined under Oregon law?
• Is my worker entitled to workers’ compensation under Oregon law, or are they exempt?

What does workers’ comp generally cover in the state of Oregon?

Generally speaking, workers’ compensation provides medical and financial benefits to eligible employees who suffer a work-related illness or injury. However, the details vary by state because workers compensation is governed at the state level. The Oregon Workers’ Compensation Division (WCD) administers and regulates Oregon’s workers’ compensation laws and rules.

In Oregon, most workers’ compensation policies provide payment for:

• Lost wages, as a percentage of the employee’s average weekly wage.
• Medical expenses, including reimbursement for medical care, prescription medications, transportation, meals, and other related expenses (up to the established limit).
• Temporary or permanent disability (total or partial benefits).
• Vocational assistance to help injured workers return to appropriate employment.
• Death expenses, which cover funeral costs and provide permanent disability benefits to eligible beneficiaries.

Obtaining workers’ compensation coverage in Oregon

Employers in Oregon can purchase workers’ comp coverage from any authorized insurer within the state. According to Oregon’s WCD, over 300 companies are approved to write workers’ compensation policies in the state of Oregon.

Additional information for obtaining coverage:

• Employers must typically go through an agent to obtain workers’ comp from an authorized insurer.
• Some insurers work directly with employers, eliminating the need for an agent.
• A few insurers provide workers comp policies through business organizations and associations.

If one or more insurers refuse your workers’ comp application, you may obtain the insurance through the Oregon Assigned Risk Insurance Plan — which is administered by the National Council on Compensation Insurance (NCCI). You will need to submit a special application to the NCCI. Once it’s approved, the NCCI will send your account to an authorized insurer in Oregon.

Alternatively, Oregon employers have the option to self-insure, instead of purchasing the plan through an insurance company. This means the employer assumes all the financial risks of supplying workers’ compensation to their employees. An Oregon employer (or group of employers) can self-insure by applying to the Department of Consumer and Business Services.

What can happen if an Oregon employer violates workers’ comp requirements?

Oregon employers must adhere to all applicable workers’ compensation laws. Otherwise, they risk penalties. If the employer doesn’t have the required coverage, Oregon’s WCD will take action.

Here’s how the process works:

• The WCD will send the employer an order after discovering the lack of coverage.
• The order informs the employer of the noncompliance period and the fine amount.
• For the first violation, the penalty is double whatever amount the employer was supposed to pay for insurance, with the minimum being $1,000.
• If the employer keeps failing to provide coverage after the first order, the penalty is $250 per day for each additional day of noncompliance.
• The total assessed penalty has no established maximum.
• If the employer receives three or more orders of noncompliance, the WCD will attempt to force compliance by seeking a permanent injunction from the court.
• Failing to follow the injunction will result in contempt of court and possibly other forms of sanctions, including imprisonment.

Noncompliance consequences may stretch beyond governmental penalties

An Oregon employer without the required workers’ comp coverage is financially liable if an employee suffers a work-related injury. The uninsured, injured employee is entitled to the same workers’ comp benefits that insured employees receive.

In such situations:

• Only a certified claims agent can process the workers’ comp claim.
• The employer must pay a fee for the claims processing, along with the total benefit costs.
• Oftentimes, the total amount reaches hundreds of thousands of dollars.
• Bankruptcy cannot lower the employer’s workers comp debt.
• Business owners, including corporate officers and LLC members, are personally and severally responsible for the debt.
• Employees can file a lawsuit against their employer for lack of coverage, ultimately increasing the cost to the employer.

What happens if an employee in Oregon is involved in a workplace incident?

When a work-related injury occurs, both the employee and the employer have specific responsibilities.

• The employee should notify their employer as soon as possible if they experience a work-related injury or illness.
• The employee has the right to file a workers’ comp claim. Generally, employees in Oregon can file a claim up to one year from when the incident occurred.
• If the employee elects to file a claim, the employer must give them Form 801, Report of Job Injury or Illness, to complete.
• The employer must inform their insurance company of the injury within five days of when they first learned about the incident plus send them the completed Form 801. When submitting Form 801, the employer can attach a statement detailing any concerns they have, including suspicions about the claim.
• The employee can seek medical care at a doctor or medical facility of their choosing.
• The insurer must accept or reject the claim within 60 days, and then notify Oregon’s WCD of the acceptance or rejection within 14 days.
• The employer can request a hearing regarding actions taken on the workers’ comp claim.

Oregon employers can point their employees to the WCD’s website, which explains employees’ rights and responsibilities if they get hurt on the job. Additionally, employers can learn more about their own rights and responsibilities by reviewing the WCD’s website.

More resources for Oregon employers

• Oregon WCD: Employer
• Oregon WCD: Worker
• Oregon WCD: Laws and Rules Resources
• Oregon Workers’ Compensation: Frequently Asked Questions

For more information on workers’ compensation in Oregon, you can contact the WCD’s office in other ways.

• Get help by phone: 888-877-5670 (toll-free) or 503-947-7815
• Or reach them by email: wcd.employerinfo@dcbs.oregon.gov