Fast Facts- WC Officer Exemptions
Happy to help! Here are the quick facts on officer exemptions.
An Officer Exemption lets certain owners and officers choose to leave themselves off their company's Work Comp policy instead of being covered automatically.
Who can apply
In Florida, corporate officers and LLC members can apply. Ask us before assuming a sole proprietor or partner qualifies, because the answer depends on your business type and industry.
- Construction: up to 3 officers can be exempt. Each must own at least 10% of the company, and the filing fee is $50 per exemption.
- Non-construction: up to 10 officers can be exempt, with no ownership requirement and no fee.
- Every exempt officer has to complete a short online tutorial.
Filing and renewing
Why people choose it
- They don't want to pay premium for themselves.
- They have other protection in place, such as an occupational accident policy.
The risks
- An exempt officer gets no workers' comp benefits, medical or wages, if injured on the job.
- Disputes can come up if the paperwork isn't filed or kept current.
- Some clients require everyone, owners included, to be covered, so an exemption can cost you a contract.
Officer minimum and maximum
When officers or LLC members are included on the policy, their payroll for premium purposes isn't always what they actually earn. The state sets a minimum and a maximum. The minimum is the lowest amount an officer's pay can count as, and the maximum is the highest. This keeps people from underreporting pay to lower premium, and it keeps very high salaries from driving the premium up.
Whether an officer is exempt decides whether the limits apply.
- Exempt officer: no payroll is reported, no premium is charged, and the minimum and maximum do not apply.
- Included officer: payroll is checked at audit and adjusted to the minimum or maximum if needed. This is true however the officer is paid, whether by salary, draws, bonuses, or irregular pay.
At audit, pay below the minimum is raised to the minimum. Pay above the maximum is lowered to the maximum. Pay in between is used as paid.
Common audit problems
- Expired or missing exemptions
- Officers listed at $0 payroll but included on the policy
- Owners paid by draws only, with no exemption filed
Does an exempt officer pay premium?
No. An exempt officer has no payroll on the policy, so there is no premium to calculate. They also can't use the coverage. If they are hurt at work, workers' comp will not pay, and most health plans exclude injuries that happen at work, so they could be left paying out of pocket. See "Exempt Officers and WC Claims."
Current minimum and maximum
These change every year. Email us for the current figures.
For the full rules, see "Work Comp: What is an Officer Exemption?"
If you have any questions, please feel free to contact us at workcomp@ibusinesssolutions.com or call (941) 487-7275, ext. 3. Our business hours are 9:00am-5:00pm EST.