Arkansas Workers Comp Waiver: Filing, Exemptions, and Penalties

In Arkansas, only a narrow group of business owners and self-employed individuals can file an Arkansas workers’ comp waiver: corporate officers, sole proprietors, partners, LLC members, professional association members, and self-employed employers who own and operate their own business. Rank-and-file employees cannot waive coverage under any circumstances. The process runs through the Arkansas Workers’ Compensation Commission, uses a notarized Form A, and costs $50, but the real question is whether opting out is worth what you give up.¹

Who Can File a Waiver in Arkansas

Arkansas Code 11-9-108(a) states that no agreement by an employee to give up workers’ compensation rights is valid. A form handed to a regular employee asking them to waive coverage is worthless whether they sign it or not. The waiver door opens only for people with an ownership stake or self-employed status.¹

Under Section 11-9-108(b)(1), these categories qualify:

Officers of any corporation, regardless of company size.
Sole proprietors running an unincorporated business on their own.
Partners in a general or limited partnership.
Members of a limited liability company.
Members of a professional association organized under Arkansas law.
Self-employed individuals who own and operate their own business and employ others.

Two conditions apply across the board. The person must own and operate the business, so a passive investor with no operational role likely doesn’t qualify. And subcontractors are explicitly excluded from waiver eligibility, which matters most in the construction trades where subcontracting is standard.¹

How to File the Waiver

The waiver runs through the Arkansas Workers’ Compensation Commission. Complete the Application for Certificate of Non-Coverage, known as Form A, available on the Commission’s website. The affidavit portion has to be notarized before you submit anything.²

You can mail the completed form with the notarized affidavit and a $50 check or money order to the address on the form, or submit it online through the Commission’s payment portal. Either route requires the form and notarized affidavit to be finished first. Providing an email address and phone number gets you an expedited electronic copy of the Certificate of Non-Coverage once it’s approved.²

Keep the certificate on file. It’s your documentation that the exclusion was processed through the state, which matters if an injury or an insurance audit puts your coverage status in question.

Waivers Don’t Eliminate Coverage for Your Employees

Most Arkansas employers must carry workers’ compensation once they have three or more employees.³ Business owners sometimes assume that if enough owners waive out, the headcount drops below three and the coverage requirement disappears. It doesn’t. Section 11-9-108(b)(2) is direct: even if waivers reduce the count to fewer than three employees, the employer must still provide coverage for the remaining workers.¹

An LLC with two members and two employees is a common example. If both members waive, two employees remain, and both stay covered.

Construction changes the math further. Under Section 11-9-102, coverage is required with two or more employees on building or repair work, with one or more employees if a contractor subcontracts any part of the job, and with one or more employees for subcontractors themselves.⁴ Combined with the subcontractor exclusion from waivers, this leaves the construction industry with far fewer opt-out options than other sectors.

What You Give Up

A waiver isn’t just paperwork. Workers’ compensation pays your medical bills and replaces part of your income after an on-the-job injury, without any requirement to prove fault. That no-fault feature is the core of the system, and it’s gone once you waive.

After an injury, your options narrow. A personal injury lawsuit against a negligent third party is still available, but you bear the full burden of proving someone else caused the injury, litigation can stretch out for months or years, and there’s no guarantee of recovery. Most owners who waive fill the gap with private health insurance and disability coverage. Those cost money, but going without any backstop after a serious workplace injury can be financially devastating.

There’s a Medicare wrinkle worth flagging. Under Medicare Secondary Payer rules, Medicare is secondary to workers’ compensation. If you waive coverage and Medicare ends up paying for a workplace injury it would otherwise not have covered, reimbursement questions can arise, and an employer carrying its own risk after a waiver could be treated as self-insured under federal rules, creating potential liability to repay Medicare.⁵

Employment Types That Never Needed a Waiver

Some jobs sit outside the workers’ compensation system entirely, so a waiver would be pointless. Under Section 11-9-102, the exempt categories include domestic workers in private homes, home maintenance and gardening workers, agricultural farm labor, employees of qualifying nonprofit religious, charitable, or relief organizations, newspaper vendors and distributors, certain licensed real estate agents who meet the IRS definition of a qualified real estate agent, and workers covered by federal systems such as railroad and maritime employees.⁴ If your work falls into one of these buckets, coverage never applied and the waiver process isn’t relevant to you.

Penalties for Skipping Coverage Without a Valid Waiver

A waiver is the lawful way for a qualifying individual to opt out. Simply failing to carry required coverage is a different problem. Under Section 11-9-406, an employer who fails to secure workers’ compensation faces:

A civil fine of up to $10,000 assessed by the Workers’ Compensation Commission and payable to the Death and Permanent Total Disability Trust Fund, or a Class D felony charge.
Daily penalties of up to $1,000 for each day the violation continues.
A circuit court injunction barring the employer from conducting business until coverage is obtained or all penalties are paid in full.⁶

The injunction is the one that shuts businesses down. Once the court orders you to stop operating, you don’t reopen until you’re compliant. If you’re unsure whether coverage applies to your setup, the Commission’s Information Officer and its Operations and Compliance Division can answer that before it turns into an enforcement matter.³

1
Justia. Arkansas Code 11-9-108 – Waiver of Compensation Void – Exception
2
Arkansas Department of Labor and Licensing. Certificates of Non-Coverage
3
Arkansas Department of Labor and Licensing. Basic Facts
4
Justia. Arkansas Code 11-9-102 – Definitions
5
Centers for Medicare & Medicaid Services (CMS). Medicare Secondary Payer (MSP) Liability Insurance, No-Fault Insurance and Workers’ Compensation Recovery Process
6
Justia. Arkansas Code 11-9-406 – Failure to Secure Payment of Compensation