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Oregon workers' comp for contractors who hire subs: when you're responsible for a sub's coverage

General educational information, not legal or insurance advice. Oregon law, the Workers' Compensation Division (WCD), and your insurer decide your situation. Check with them or an attorney before relying on this.

How Oregon coverage works

Oregon employers can buy workers' comp from any insurer authorized in the state (SAIF is the state-chartered one), be certified as self-insured, or get coverage through a licensed worker leasing company. Your insurer files proof of coverage with WCD for each new or renewed policy (WCD, Why do I need workers' compensation insurance?). Like Idaho, premium is generally based on payroll by class, so our payroll-based audit cost calculator can give a rough idea. Ask your carrier how it treats subcontractor costs at audit.

The "prime contractor" rule

Under ORS 656.029, if you award a contract for labor that's a normal and customary part of your trade or business, you're responsible for workers' comp for the people doing that labor, unless the person you hired provides that coverage before labor under the contract starts. If someone gets hurt and nobody provided the coverage, the person responsible is treated as a noncomplying employer. WCD puts it simply: if you subcontract, you must make sure your subs have coverage when work on the project begins, or you're responsible for it (WCD publication 2852).

A separate rule, ORS 656.556, can make the person letting a contract liable to the state's Industrial Accident Fund for premiums, fees, and assessments due on the work when the contractor works as a subject employer on premises the hiring party owns, controls, or conducts business on.

When you're not responsible

SAIF's employer guide says you aren't responsible for covering a contractor who (SAIF, Subcontractors):

• Has employees and carries its own workers' comp, in effect before work begins under the contract. SAIF says a later lapse during the contract doesn't make you responsible.
• Does a job that isn't a routine part of your normal business.
• Does construction work, with or without assistants, and has an active Construction Contractors Board (CCB) license.
• Does landscape construction work and has an active Landscape Contractors Board (LCB) license.

For other situations it comes down to direction and control: whether the sub works for others too, sets its own hours, supplies its own tools, is paid a fixed bid, and so on. SAIF lists the full set of questions on the page above.

A simple routine

• Before work starts: get a current certificate of insurance from any sub that says it has a workers' comp policy, and check that the policy dates cover the whole job (SAIF).
• Verify it with the state: look the sub up on WCD's Proof of Coverage Search and save a dated copy. The search is spelling-sensitive, and WCD's Employer Compliance Unit can help if it comes up empty.
• Check the license: for construction or landscape work, record the sub's CCB or LCB number and confirm it's active.
• Keep it all in one place: our free certificate tracker has columns for policy dates, and you can add one for the CCB number.

What about general liability?

Workers' comp is only one piece. Many general contractors also ask subs for a general liability certificate. See contractor insurance types explained.

Shopping for general liability or workers' comp: [AFFILIATE LINK PLACEHOLDER: ERGO NEXT Insurance quote, pending program approval] Comparing quotes from more than one carrier or an independent agent is common practice.

Sources (checked Nov 5, 2026)

• ORS 656.029 and ORS 656.556 (Oregon Revised Statutes, via oregon.public.law)
• Oregon Workers' Compensation Division publication 2852, Why do I need workers' compensation insurance?
• WCD Proof of Coverage Search
• SAIF Corporation employer guide, Subcontractors

Unverified by us: how any particular carrier handles subcontractor payroll at audit. Ask your insurer.