OAR 436-110-0325: Premium Exemption

(1) General provisions. (a) The purpose of premium exemption is to provide an incentive for employers to hire and retain preferred workers. (b) Premium exemption releases an employer from paying workers’ compensation insurance premiums and premium assessments on a preferred worker for three years from the date premium exemption started. When premium exemption is in place, the employer does not report, and the insurer may not use, the preferred worker’s payroll for the calculation of insurance premiums or premium assessments. However, the employer must report and pay the Workers’ Benefit Fund assessment and withhold employee contributions as required by ORS 656.506 and OAR 436-070. The employer must start paying insurance premiums and premium assessments when premium exemption ends. (2) Employer eligibility. To be eligible for premium exemption the employer must: (a) Hire a preferred worker or, for the employer at injury or aggravation, bring back its preferred worker to a new or modified job; and (b) Notify the division within 90 days from the date of eligibility or the date of hire, whichever is later. (3) Exclusion. Premium exemption may not be used if the worker has permanent restrictions but returns to regular work. (4) Division notification. (a) The employer must notify the division within 90 days from the date of eligibility or the date of hire, whichever is later. (b) If the director approves premium exemption, the division will notify the employer and insurer of the premium exemption period. (c) If the director does not approve premium exemption, the division will notify the employer. (5) Premium exemption period. (a) For the employer at injury or aggravation, premium exemption starts on the date of hire or the date of eligibility, whichever is later. (b) If the employer is not the employer at injury or aggravation, the worker discloses preferred worker status to that employer, and the employer notifies the division within 90 days from the date of hire that it has hired a preferred worker, premium exemption starts on the date of hire. (c) The three-year premium exemption period may not be extended, even if the preferred worker’s job duties change or the employer’s ownership or legal status changes. (6) Claims costs. If a worker covered under premium exemption incurs a compensable injury or occupational disease during the premium exemption period, the employer must notify its insurer of the injury and the worker’s preferred worker status. The claim costs for the injury are reimbursed under OAR 436-110-0330.