ORS 657.044¹
  • service by partners and corporate officers and directors who are family members and by certain sole corporate officers and directors excluded
  • election
  • exceptions

(1) As used in this chapter, “employment” does not include service performed for:

(a) A corporation by corporate officers who:

(A) Are directors of the corporation;

(B) Have a substantial ownership interest in the corporation; and

(C) Are members of the same family.

(b) A corporation by an individual who is the sole corporate officer and director of the corporation and who has a substantial ownership interest in the corporation.

(c) A limited liability company by a member, including members who are managers, as defined in ORS 63.001 (Definitions).

(d) A limited liability partnership by a partner as described in ORS chapter 67.

(2)(a) The exclusion under subsection (1)(a) or (b) of this section is effective only if the corporation elects not to provide coverage for the individuals described respectively in subsection (1)(a) or (b) of this section.

(b) The election must be in writing and is effective on the first day of the current calendar quarter or, upon request, on the first day of the calendar quarter preceding the calendar quarter in which the request is submitted.

(3) The provisions of this section do not apply to service performed for:

(a) A nonprofit employing unit;

(b) This state;

(c) A political subdivision of this state; or

(d) An Indian tribe.

(4) As used in this section, “members of the same family” means persons who are members of a family as parents, stepparents, grandparents, spouses, sons-in-law, daughters-in-law, brothers, sisters, children, stepchildren, adopted children or grandchildren. [1995 c.220 §2; 1997 c.646 §15; 1999 c.59 §195; 2001 c.572 §3; 2003 c.792 §1; 2005 c.218 §9; 2009 c.79 §1; 2013 c.311 §1]

Note: Section 2, chapter 311, Oregon Laws 2013, provides:

Sec. 2. (1) Notwithstanding ORS 657.044 (Employment) (2)(b), an election under ORS 657.044 (Employment) (2) may not become effective before the January 1 that immediately follows the first date after the effective date of this 2013 Act [October 7, 2013] on which a Fund Adequacy Percentage Ratio schedule lower than V, V B or V C, pursuant to ORS 657.462 (Computation of benefit ratio), 657.463 (Tax rate schedules) or 657.439 (Wage Security Program funding), respectively, is in effect.

(2) The Director of the Employment Department shall notify Legislative Counsel when a Fund Adequacy Percentage Ratio schedule lower than V, V B or V C, pursuant to ORS 657.462 (Computation of benefit ratio), 657.463 (Tax rate schedules) or 657.439 (Wage Security Program funding), respectively, is in effect for the first time following the effective date of this 2013 Act. [2013 c.311 §2]

Notes of Decisions

Individual who is sole owner and director of corpora­tion does not qualify as “family.” Employ­ment Depart­ment v. Stock Secrets, Inc., 210 Or App 426, 150 P3d 1090 (2007)

Chapter 657

Notes of Decisions

An individual who performs services for remunera­tion is an employee, and per­son or organiza­tion for whom services are performed is an employer under terms of Employ­ment Division Law even if remunera­tion is paid indirectly rather than directly unless employer shows that some statutory exclusion applies. Lectro Lift, Inc. v. Morgan, 14 Or App 316, 513 P2d 526 (1973)

Mere act of incorporating as professional corpora­tion does not, by itself, create employer-employee rela­tionship for purposes of this chapter. Peterson v. Employ­ment Division, 82 Or App 371, 728 P2d 95 (1986)

Determina­tion of whether claimant is qualified for benefits is made by reference to ORS 657.150 (Amount of benefits) and 657.155 (Benefit eligibility conditions), which require determina­tion of amount of work that claimant performed in “employ­ment” as defined in ORS chapter 657, which, in turn means that exclusions from “employ­ment” set out in ORS 657.040 (Employment) through 657.094 (Employment) must be considered. May Trucking Co. v. Employ­ment Dept., 251 Or App 555, 284 P3d 553 (2012)

Atty. Gen. Opinions

Determining employer of musicians’ group, (1972) Vol 35, p 1306

1 Legislative Counsel Committee, CHAPTER 657—Unemployment Insurance, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors657.­html (2019) (last ac­cessed May 16, 2020).
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2019, Chapter 657, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano657.­html (2019) (last ac­cessed May 16, 2020).
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent. Currency Information