Louisiana
Workers' Comp Exemption

Louisiana requires coverage with one employee and includes temporary or seasonal workers

Louisiana Workforce Commission’s employer FAQ says workers’ compensation is required even when the business has only one employee. The agency expressly includes full-time, part-time, temporary, and seasonal employees in that starting rule.

That means an owner-only business can change status with a single hire. A short-term helper hired for a busy week can be enough to make ‘I usually work alone’ an unreliable explanation if the person is actually an employee.

Start every Louisiana review with a real worker inventory: employees, borrowed or leased workers, part-time help, unpaid volunteers, and subcontractors. The agency’s no-employee examples are narrow because those additional people can change the result.

Louisiana does not issue a state certificate saying a business is exempt

The LWC FAQ answers this directly: Louisiana does not issue an exemption form declaring that a business is exempt from workers’ compensation. That matters when a general contractor or customer asks for a state exemption certificate that does not exist under Louisiana’s system.

An owner may instead have evidence showing why a policy is not required for an owner-only business, or a written agreement with the insurer showing that a qualifying owner elected not to be personally covered. Those documents answer different questions and should not be renamed to satisfy a customer’s vocabulary.

If a customer requires a certificate of insurance regardless of statutory owner status, that is a contract requirement. The owner may need to obtain coverage or an appropriate policy product rather than trying to manufacture a state certificate Louisiana does not issue.

R.S. 23:1035 gives specified owners a written non-election route

Louisiana R.S. 23:1035 allows a sole proprietor, a partner, a qualifying LLC member, and specified bona fide corporate officers to elect not to be covered through written agreement with the insurer or group self-insurance fund. For an LLC member, the statute requires at least a 10% membership interest. For a corporate officer, it applies to a bona fide president, vice president, secretary, or treasurer owning at least 10% of the corporation’s stock.

The election is binding as described by the statute and applies to the entity’s trades, businesses, or occupations. The owner’s salary or compensation is excluded from the workers’ compensation premium calculation under the statutory provision.

This is a personal owner election. It does not say the corporation, LLC, partnership, or proprietorship can leave ordinary employees uninsured. Keep the written insurer agreement with ownership and officer records showing why the person qualified when the election was made.

The no-employee examples depend on keeping the business truly owner-only

LWC gives practical examples of businesses that may not need a policy when there are no employees. The examples include an individual owner in a non-corporate business with no employees or other listed workers, an owner-only partnership, and a narrow one or two-person corporation where the owners hold all shares and offices and no other people are working for the company.

The agency’s examples are deliberately fact-heavy: leased employees, borrowed employees, part-time help, unpaid volunteers including family, and subcontractors are called out because they can break the simple owner-only picture. For a two-person corporation, the FAQ also describes ownership and office-holding conditions.

Do not turn these examples into a permanent registration status. The first added worker or subcontractor can require a fresh analysis even if the entity and tax ID are unchanged.

An owner non-election does not erase principal or subcontractor workers’ compensation exposure

Louisiana’s workers’ compensation statutes use a principal concept for work that is part of the principal’s trade, business, or occupation or work the principal contracted to perform. The statutory framework can create workers’ compensation consequences in contractor and subcontractor relationships even when an individual contractor is a sole proprietor who elected not to be personally covered.

LWC therefore advises employers to examine subcontractors and independent contractors rather than assuming a 1099 label solves coverage. Louisiana’s independent-contractor definition is also specific and can treat manual-labor circumstances differently from what a tax form suggests.

For a contractor file, keep the owner non-election agreement separate from certificates or proof covering employees and subcontractor labor. A general contractor asking for insurance is often addressing chain-of-contract risk, not disputing the owner’s 10% election.

The first worker, ownership percentage, officer title, and carrier agreement are the Louisiana reset points

A qualifying LLC member or corporate officer can lose the factual basis for the R.S. 23:1035 owner election if ownership drops below the 10% threshold or the corporate role no longer matches the offices named by the statute. A sole proprietor who incorporates also moves into a different owner category.

The first employee is an even clearer reset because Louisiana begins with one employee. Contractor use should be reviewed as well, particularly where the work can bring the principal or subcontractor provisions into play.

Finally, verify the written non-election with the current insurer or group self-insurance fund after a carrier change. Louisiana’s system is based on that written agreement, not on a permanent certificate issued by the state.

What failing to secure coverage actually costs in Louisiana

Louisiana scales its civil penalty per employee rather than as a single flat fine, and adds a business-closing order for employers who ignore a judge's compliance deadline a second time.

An employer who fails to secure required coverage is liable for a civil penalty of up to $250 per employee for a first offense (capped at $10,000 total for a related series of violations), rising to up to $500 per employee for a second or subsequent offense.

If an employer does not file proof of coverage within 45 days of a workers' compensation judge's order, a second-offense fine is assessed and the judge can issue a cease-and-desist order stopping business operations until coverage is secured and all fines are paid — enforceable through the Attorney General in district court.

• First offense: up to $250/employee, capped at $10,000 for a related series of violations
• Second or later offense: up to $500/employee
• 45 days after a judge's compliance order with no proof of coverage: second-offense fine plus a possible cease-and-desist order closing the business