Workers' comp class codes: how they are assigned and disputed

One business, one governing class

Under the NCCI classification rules that Ohio adopted in its Rule 4123-17-08, “the business of the employer within a state is classified, not separate employments, occupations, or operations within the business”⁠¹. A framing crew and the owner’s bookkeeper are not rated by their own job titles. The business gets a governing classification, and most of the payroll follows it.

The governing class is the basic classification with the greatest payroll. Standard exception classes are not eligible, even when they hold more payroll. Ohio’s own example: a drywall employer has $50,000 in code 5445 and $75,000 in clerical 8810. The governing class is 5445⁠¹. Pennsylvania’s Rule IV sets the same logic (standard exceptions may never be the governing class), and for construction it determines the governing class job by job if payroll is kept separately by job⁠².

The wording of the governing class matters. Ohio states that standard exception classes apply even if the basic class says “all employees” or “all operations”⁠¹. But the opposite is a trap: where a class’s own wording includes drivers, code 7380 does not apply, and where it includes outside salespersons, 8742 does not apply⁠¹.

The standard exceptions: 8810, 8742, 7380

Ohio’s rule lists five: clerical office (8810), clerical telecommuters (8871), commercial drivers and messengers (7380), outside sales or collectors (8742) and automotive salespersons (8748)⁠¹. Each carries conditions. These are the ones that decide most small-business premiums.

• Clerical, 8810. The duties must be done in a workstation separated from the operative hazards of factories, stores, shops, construction sites, warehouses and yards. Outside sales, physical labor, and direct supervision of nonclerical employees outside an eligible workstation disqualify an employee⁠¹. Pennsylvania uses its own code, 953, and defines separation as floor-to-ceiling partitions (five feet for retail stores); its outside salesperson code is 951⁠⁸.
• Outside sales, 8742. It does not cover delivery, and it does not cover job-site measurements or inspections to prepare bids for a construction contractor⁠¹. Ohio puts construction job-site salespersons and estimators in 8720 and forbids splitting an employee’s payroll between 8720 and a construction class at one job site⁠¹.
• Drivers, 7380. The class is available only where the basic class does not already include drivers⁠¹. Ohio’s roofing class 5551, “roofing – all kinds and drivers”, is an example of wording that includes them.

The rate gap is the reason this is contested. Ohio’s official base rates, effective July 1, 2026, per $100 of payroll:

Base rates set by the state fund before experience modification. Ohio and Wyoming charge per $100 of payroll; Washington charges per hour worked, and part is withheld from wages. Other states’ insurers file their own rates; see where rates are published.

Clerical 8810 is $0.0466 and residential carpentry 5645 is $3.4595, a ratio of about 74 to 1 (our calculation from the published rates).

Worked example: clerical payroll in a construction firm

Assumptions (ours): a specialty contractor with $300,000 of field payroll and $60,000 of office payroll, no experience mod, no discounts, no minimums. The calculation is manual premium only: payroll ÷ 100 × base rate.

Rates are from the Ohio BWC appendix⁠⁹ and Wyoming’s 2026 industry base rate file⁠¹⁰; both are base rates before experience modification and discounts. The two states are not comparable with each other: Ohio’s system is state-fund and NCCI-code based, Wyoming’s is NAICS-based. The Ohio saving is the gain only if the office qualifies. If the office worker also supervises field crews or does physical work,⁠¹ puts that payroll back into the governing class.

How construction payroll splits differ by state

Ohio permits an additional basic class for a separate operation that could exist as its own business, is physically separate from the principal business and has proper payroll records. A lower-rated additional operation that does not qualify is assigned to the principal business class⁠¹. Construction work is split by type of operation only if separate payroll records are kept; otherwise the highest-rated class that applies at the job or location is assigned⁠¹. For an individual employee who moves between classes (“interchange of labor”), payroll may be divided only on actual time records; “estimated or percentage allocation” is not allowed, and without records the employee’s whole payroll goes to the highest-rated class. Codes 8810, 8871, 8742 and 8748 cannot be used in these divisions⁠¹.

• Pennsylvania (three-digit codes). The rule is the same: the whole payroll of an interchanging employee goes to the highest-valued class, except that construction, erection, temporary staffing and stevedoring payroll may be divided with original records⁠². Clerical is 953 and outside sales 951⁠⁸.
• California (dual wage classes). Dual wage classes are construction or erection classes that require the regular hourly wage to equal or exceed a specified amount. For high-wage placement, the employee’s regular hourly wage must equal or exceed the stated threshold, and for hourly employees that has to be shown with original time cards (operations, hours, start and end of each work period) or a valid collective bargaining agreement. WCIRB’s example: electricians were moved from the lower-rated high-wage class 5140 to the higher-rated low-wage class 5190 at audit because the time cards lacked start and end times⁠⁶.
• Washington (hourly classes). Washington State’s own risk classes are rated per hour worked, not per $100 of payroll. For 2026, clerical 4904 is $0.2223 per hour and roof work 0507 is $5.793⁠⁷. One employee working 2,000 hours would cost $444.60 in 4904 or $11,586.00 in 0507 (our calculation), before experience rating and before the employee’s share is withheld.
• Wyoming (NAICS-based). Classes follow NAICS: 238000 for specialty trade contractors, 236000 for construction of buildings, and special exception codes 000010 (clerical), 000020 (outside sales) and 000030 (automotive inside sales)⁠¹⁰. Wyoming has no 7380-style driver exception in its 2026 file.

Base rates set by the state fund before experience modification. Ohio and Wyoming charge per $100 of payroll; Washington charges per hour worked, and part is withheld from wages. Other states’ insurers file their own rates; see where rates are published.

Classification inspections and reclassification

Carriers and NCCI reclassify at audit and by inspection. In NCCI’s 2021-2023 inspection data, code 8292 was the most reclassified: over 60% of inspected policies with 8292 as the governing class changed, and over 75% of those moved to a mercantile code. More than 25% of policies in 5437 changed, and over 30% of those went to 5645. For 9015, more than 25% changed, with over 20% of those to 9012, a class that includes clerical and sales and so rules out 8810 and 8742⁠⁵. These are NCCI’s inspection samples, not a statement about every employer.

How to dispute a classification

1. Start with the carrier

   In most NCCI states you work it out with the carrier first, pay the undisputed premium and an estimate of the disputed amount⁠⁴.

2. NCCI review

   An NCCI consultant reviews it. An inspection used in a dispute looks at current operations, is not binding on a pending dispute, and NCCI bills for the inspection time⁠⁴.

3. State board

   If unresolved, the dispute goes to the state Workers Compensation Appeals Board or a committee, typically three to ten members chosen by NCCI or appointed by the regulator. Be ready for a 10-20 minute presentation. Further appeals follow state law⁠⁴.

4. Pennsylvania

   File with the PCRB no later than 30 days from its staff’s final decision for each step. The initial appeal must be filed during the policy period or within 12 months after. Decisions move from staff review to the Appeals Subcommittee, then to the Insurance Commissioner; no attorney is required⁠³. A correction that lowers premium applies to the current policy and the prior policy within 12 months; an increase applies from the first policy effective at least 60 days after notice⁠².

This section covers the NCCI process and Pennsylvania. California, Washington and Wyoming run their own procedures, which are not described here.

The evidence that wins is operational: payroll by job and class, time cards, floor plans showing a clerical workstation, and job descriptions. The classification rules above turn on those records.

Sources

1. 1
   Ohio Bureau of Workers' Compensation, Ohio Adm.Code 4123-17-08: classification of occupations and industries, rules Checked 13 Oct 2026 · Back to text ↑
2. 2
   Pennsylvania Compensation Rating Bureau, Rule IV, Classifications (Workers Compensation Manual, Section 1) Checked 13 Oct 2026 · Back to text ↑
3. 3
   Pennsylvania Compensation Rating Bureau, Rule XVI, Appeals from Application of the Rating System Procedure Checked 13 Oct 2026 · Back to text ↑
4. 4
   National Council on Compensation Insurance, Dispute resolution process Checked 13 Oct 2026 · Back to text ↑
5. 5
   National Council on Compensation Insurance, Insights: 2023 Class Inspection Program, top reclassified code Checked 13 Oct 2026 · Back to text ↑
6. 6
   Workers' Compensation Insurance Rating Bureau of California (Policyholder Ombudsman), Essential Things Employers Should Know About Payroll & Workers' Compensation: Dual Wage Classifications Checked 13 Oct 2026 · Back to text ↑
7. 7
   Washington State Department of Labor & Industries, 2026 hourly rates by risk classification and fund Checked 13 Oct 2026 · Back to text ↑
8. 8
   Pennsylvania Compensation Rating Bureau, Workers Compensation Manual, Section 2: Classifications Checked 13 Oct 2026 · Back to text ↑
9. 9
   Ohio Bureau of Workers' Compensation, Ohio Adm.Code 4123-17-06, Appendix A: base rates effective July 1, 2026 Checked 13 Oct 2026 · Back to text ↑
10. 10
    Wyoming Department of Workforce Services, Workers' Compensation Division, 2026 Industry Base Rates by Classification Checked 13 Oct 2026 · Back to text ↑

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