Certain business owners who meet the statutory requirements may elect to exclude themselves from workers' compensation insurance coverage, including:

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• Officers and members of boards of directors of certain types of corporations

• Owners of professional corporations

• General partners

• Managing members of limited liability companies 

 

The California Labor Code (Sections 3351 and 3352) governs the exclusion of these individuals. Refer to the California Labor Code to review the individuals who may elect to exclude themselves from coverage if they meet the requirements for exclusion:

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• Section 3351

• Section 3352 

 

In order to be excluded, the individual must execute a document, in writing and under penalty of perjury, waiving their rights under the Labor Code and stating that they have the qualifications or coverage(s) required by the Labor Code. There are additional waiver requirements for officers or members of the board of directors of a cooperative corporation and owners of a professional corporation. 

 

Effective July 1, 2018, a sole shareholder who is an officer or director of a private corporation or a private cooperative corporation, or who is an owner of a private professional corporation, is excluded from the definition of “employee,” unless the officer, director, owner, private corporation, private cooperative corporation or private professional corporation, as applicable, has elected to be subject to liability for workers’ compensation pursuant to Labor Code Section 4151(a).

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Should you have questions concerning these exclusions, please consult your insurance professional or legal advisor.

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The Ca Work Comp Bureau does publish yearly Payroll – Minimums and Maximums.

When any of the individuals above are subject to workers' compensation coverage, the annual payroll used for premium computation is subject to minimum and maximum limitations, each year a new payroll limitation is released by the Work Comp Bureau, for the 2025 policy effective 09-01-2025 any policy written after this date initial the next release date the payroll limitations are:

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Effective: 9/1/2025

Minimum Payroll: $63,700

Maximum Payroll: $165,100

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