A sole proprietor engaged in the construction industry in Florida cannot file a workers comp exemption. Florida Statutes §440.02(18)(c) includes “a sole proprietor who engages in the construction industry and a partner or partnership that is engaged in the construction industry” in the definition of employee. The exemption is an officer or member instrument: under §440.02(18)(b) no more than three officers of a corporation or affiliated group may elect it, and each must own at least 10 percent of the stock. LLC members elect on the same footing. So the practical route for a construction sole proprietor who wants an exemption runs through forming a corporation or an LLC and holding real ownership — and even then it covers only that person, never a crew.
- Florida construction employers need workers compensation at the first employee; most non-construction employers at four. Roofing contractors carry it at any size, sole proprietors included.
- §440.02(18)(c) includes a sole proprietor or partner engaged in the construction industry in the definition of “employee.” In construction there is no sole-proprietor exemption.
- An exemption is an officer or member instrument: under §440.02(18)(b) no more than three officers of a corporation or affiliated group may elect exemption, and each must own at least 10 percent of the stock. LLC members elect on the same footing.
- Under §440.05 a construction certificate of election to be exempt costs $50, is filed online through the Division’s CCIS with a required tutorial, takes up to 30 days to review and is valid for two years. An exempt owner injured on the job receives nothing from workers comp.
- Operating without required coverage exposes the employer to a stop-work order and a penalty of twice the premium the employer would have paid.
- A certificate of insurance is free once a policy exists and, with an active policy, is often same-day.
Why so many contractors get this backwards
Outside construction the intuition is right: a Florida sole proprietor with no employees is generally not an employee of anyone and does not have to cover themselves. Construction reverses it. The statute deliberately pulls sole proprietors and partners into the definition of employee, because the industry is where uncovered injuries and misclassified crews concentrate. The same paragraph is what makes an uncovered subcontractor your problem at audit.
What an exemption actually is, and is not
| What the exemption does | What it does not do | |
|---|---|---|
| Who | Covers the named corporate officer or LLC member only, capped at three per corporation or affiliated group, each owning at least 10 percent. | Never covers an employee, a helper, a day labourer or a subcontractor’s crew. |
| Effect | Removes that person from the coverage requirement, which removes their payroll from the premium calculation. | Does not create any benefit. An exempt owner injured on the job receives nothing from workers comp: no medical, no lost wages. |
| Process | Filed online through the Division’s CCIS with a $50 fee and a required tutorial, reviewed in up to 30 days, valid two years, renewable. | Does not satisfy a general contractor who wants a certificate of insurance for the work, and does not stop your own payroll audit. |
The three real options for a one-person construction business
- Carry a policy on yourself. The plain reading of the statute. It costs money and it is the only option that pays you if you are hurt on a roof. For anyone working at height this is worth pricing before dismissing.
- Incorporate or form an LLC, then elect exemption as an officer or member. This is the route people mean when they say “I got an exemption.” It requires real ownership of at least 10 percent, the $50 filing, the tutorial, and the understanding that you are now uninsured for your own injuries. It also does nothing for anyone else on the job.
- Work under a PEO or leasing arrangement. The leasing company becomes the employer of record and its master policy covers the work, which produces the certificate a general contractor asks for and covers you rather than excluding you. For one-person and small crews in a hard-to-place trade this is frequently the cheapest route to being both legal and actually protected.
The trap: exemptions and the subcontractor audit
If you hire subcontractors, the same paragraph that blocks your own exemption decides your audit. In Florida construction a subcontractor and its people are treated as your employees unless a valid exemption or a current certificate of insurance is on file. A 1099 does not make anyone independent for workers comp purposes. Contractors are regularly surprised at audit when an uncovered sub’s payroll is added to theirs at their own class rate. Collect the certificate or the exemption before the crew starts, not after the auditor asks.
Roofing, and why it is stricter still
Roofing contractors in Florida carry coverage regardless of size, sole proprietors included. The exemption limits above still apply to eligible officers and members, but a roofing operation should assume a policy is part of doing business rather than something to design around.
People Also Ask
Can a sole proprietor get a workers comp exemption in Florida construction?
No. Florida Statutes 440.02(18)(c) includes a sole proprietor engaged in the construction industry in the definition of employee. The exemption is available to corporate officers and LLC members, capped at three per business, each owning at least 10 percent.
What does a Florida construction exemption cost and how long does it last?
Under 440.05 the fee is $50 per construction certificate of election to be exempt or renewal, filed online through the Division's CCIS with a required tutorial. Review takes up to 30 days and the certificate is valid for two years.
If I am exempt and I get hurt on the job, what do I receive?
Nothing from workers comp. An exemption is an election not to be covered, so there is no medical benefit and no wage replacement for the exempt person. That trade is the whole point of the election and is worth pricing honestly against the premium it saves.
Does an exemption cover my helper or my subcontractor?
No. It covers only the named officer or member. In Florida construction a subcontractor's people are treated as your employees unless that sub has its own valid exemption or a current certificate of insurance on file, and a 1099 does not change that.
Do non-construction sole proprietors in Florida need workers comp?
Generally a non-construction sole proprietor is not treated as their own employee and the four-employee threshold applies to the business. The construction rules above are the exception, not the norm.
Sources: Florida Statutes 440.02 (definition of employee) · Florida Statutes 440.05 (election to be exempt) · Division of Workers’ Compensation coverage requirements · FWCJUA pricing tiers. Classification and pricing must be confirmed by the carrier or NCCI. WorkCompTeam is a referral service, not an insurer and not a licensed agency: qualified requests are routed to its licensed placement partner, Southeast Personnel Leasing, Inc. (SPLI), a Florida PEO, which quotes, binds and issues coverage. Nothing on this page is a quote or a guarantee of coverage.
Related guides
Compare with the general Florida exemption guide, exemption versus coverage, and who must carry it.