Oregon proposes higher workers’ comp rates for 2027

Oregon employers would see higher workers’ compensation costs in 2027 under a proposal from the state’s Department of Consumer and Business Services, according to HRMorning. The proposed average pure premium rate would increase 2.1%, and the average loaded pure premium would rise to 92 cents per $100 of payroll, up from 89 cents in 2026.

The premium assessment would remain at 9.8%, but the Workers’ Benefit Fund assessment would climb from 1.8 cents to 2.2 cents per hour worked. A new 0.2-cent BOLI Expense Fund component would bring the total hourly assessment to 2.4 cents. Employers must pay at least half of both assessments.

Proposed rate changes

The Department of Consumer and Business Services has proposed an average pure premium rate of 92 cents per $100 of payroll for 2027. That represents a 2.1% increase over the current rate. The loaded pure premium, which includes assessments and other charges, would also rise to 92 cents per $100 of payroll from 89 cents in 2026.

The premium assessment would stay at 9.8% of the pure premium. However, the Workers’ Benefit Fund assessment would increase from 1.8 cents to 2.2 cents per hour worked. A new BOLI Expense Fund component of 0.2 cents per hour would be added, making the total hourly assessment 2.4 cents.

Impact on employer costs

The proposed changes would increase costs for Oregon employers in two ways. First, the higher pure premium rate means employers would pay more per $100 of payroll for workers’ compensation coverage. Second, the hourly assessments would rise, adding to the cost of each hour worked by employees.

Employers are required to pay at least half of both the Workers’ Benefit Fund assessment and the BOLI Expense Fund component. The remainder may be passed on to employees through payroll deductions, subject to applicable rules.

What HR and payroll teams should know

HR and payroll professionals should prepare for potential changes to workers’ compensation costs in Oregon. If the proposal is adopted, payroll systems may need updates to reflect the new hourly assessment rates and the new BOLI Expense Fund component. Employers should also review their workers’ compensation budgets and consider the impact on total labor costs.

Rules for workers’ compensation and payroll deductions vary by jurisdiction. Employers should consult with legal counsel or a qualified advisor to ensure compliance with Oregon-specific requirements.

Next steps

The proposal is subject to review and potential modification before final rates are set. Employers should monitor communications from the Oregon Department of Consumer and Business Services for updates. HRMorning reported the proposal based on a press release from the department.

Sources: HRMorning