In Arkansas you must carry workers compensation once you regularly employ three or more people (Arkansas Code section 11-9-102). That number is not the same for everyone: it drops to two for building or building-repair work, and to one for a contractor who subcontracts any part of a job or for a subcontractor. So the same business that would be exempt at two office workers is required to carry coverage with two people on a construction crew.
Who this is for: Arkansas owners trying to figure out whether the law reaches them yet, and what changes as they add people or take on subcontracted work.
The short version
- The general trigger is three. Three or more regular employees makes coverage mandatory for an ordinary business.
- Construction is two. Two or more people doing building or building-repair work triggers it.
- A subcontracting chain is one. A contractor who subcontracts part of a job, or a subcontractor doing the work, needs coverage with a single employee.
- Owners and part-timers count. Sole proprietors, full-time partners, LLC members, part-time staff, and even volunteers all count toward the number unless an owner files a Certificate of Non-Coverage.
- Coverage should be in place before the worker starts. Once you are subject, an injury on day one is covered, so do not wait until after someone gets hurt.
How Arkansas counts to the trigger
The count is about people regularly working in your business, and the trigger number depends on the kind of work. Here is how the common cases land.
| Your situation | Coverage trigger | Notes |
|---|---|---|
| Ordinary business (office, shop, restaurant) | Three or more employees | The general rule under section 11-9-102 |
| Building or building-repair work | Two or more employees | Lower trigger for construction |
| Contractor who subcontracts part of a job | One or more employee | You are pulled in with a single worker |
| Subcontractor doing the work | One or more employee | Same single-employee trigger |
| Sole proprietor, partner, or LLC member | Counts toward the number | Unless they file Form AR-A to opt out |
| Part-time worker or volunteer | Counts toward the number | Hours do not remove someone from the count |
Who is left out of the count
Some workers are outside the Act no matter your size. Agricultural farm labor, domestic help in a private home, and workers for a nonprofit religious, charitable, or relief organization are the main examples, along with truly casual work that is not part of your regular business. Real estate agents who qualify under the federal rule and certain direct sellers are also excluded. A relative you actually put on payroll to do your regular work is generally an employee like anyone else, so do not assume family or part-time status makes the requirement disappear. When you are unsure whether a specific role counts, the Arkansas Workers' Compensation Commission is the place to confirm.
Below the trigger: not required, but exposed
If you are under the trigger for your kind of work, the state does not require a policy, but you are also outside the protection the Act gives employers. That cuts both ways. The upside is no state mandate yet. The downside is that the injury-lawsuit shield, which normally stops a hurt worker from suing you directly, does not protect a business that was not covered when the law said it should be. Many small Arkansas owners buy a policy voluntarily for exactly this reason, and because clients and general contractors demand it. If a contract is forcing your hand, see how to get a policy.
A Jonesboro example
Illustrative, not a quote. A Jonesboro cleaning company has two full-time cleaners and one steady part-timer. That is three people regularly working in the business, so Arkansas requires a policy even though one is part-time. The owner puts coverage in place before the busy season, and when a cleaner strains a back lifting equipment, comp pays the medical bills and part of the lost wages instead of turning into a lawsuit. We make sure the payroll is rated on the right kind of work so the price is fair.
Real questions Arkansas owners ask
Do I need workers comp for my Arkansas business?
Usually once you regularly employ three or more people, under Arkansas Code section 11-9-102. The trigger is two for building work and one for anyone in a subcontracting chain. Owners and part-timers count toward the number.
How many employees trigger workers comp in Arkansas?
Three for an ordinary business, two for building or building-repair work, and one for a contractor who subcontracts part of a job or for a subcontractor. There is no single flat number that fits every business.
Do part-time and seasonal workers count toward the number?
Yes. Arkansas counts regular part-time and seasonal workers, and even volunteers, toward the trigger. Keeping people part-time does not keep you under the line.
Do the owners count toward the trigger?
Yes, by default. A sole proprietor, full-time partner, or LLC member counts toward the number and is covered unless they file a Certificate of Non-Coverage, Form AR-A, with the Commission.
Does a new hire have to be covered right away?
Yes, once your business is subject to the Act. Put a policy in place before the worker who tips you over the trigger starts, because an injury on day one is still covered and still your responsibility.
Can I avoid coverage by using 1099 contractors?
Usually not. If a worker is really an employee under Arkansas's control test, they count toward the trigger and must be covered no matter what the paperwork says. Misclassifying workers is a common and costly mistake.
Who enforces the workers comp requirement in Arkansas?
The Arkansas Workers' Compensation Commission. It oversees the system, handles disputes, and can fine or seek a court order against an employer that fails to carry required coverage.
Why Arkansas owners choose Morrow
- We shop the right market for you. In Arkansas you buy workers comp on the open market from any private insurer licensed in the state, because Arkansas has no state fund, and if no carrier will take you the assigned risk plan run by the rating organization NCCI, the Arkansas Workers' Compensation Insurance Plan, is the guaranteed backstop, so we can shop your rate freely and still cover hard-to-place work.
- We catch pricing mistakes. Your price depends heavily on the category your work falls into for pricing (the class code). Put people in the wrong category and you overpay for years. We review your payroll and classifications before you buy.
- Proof of coverage, fast. Need a certificate (proof of coverage) for a general contractor or a landlord before Monday? We turn those around the same business day for most carriers.
- We help lower the score that drives your price. Insurers give you a score based on your past claims that raises or lowers your cost (the experience modification rate). We review it each year, flag errors, and connect you with return-to-work and safety resources that bring it down.
- Real people when a claim happens. When someone gets hurt, we stay involved through the life of the claim, not just at renewal.
Related Arkansas guides
Every Arkansas business is set up a little differently. These companion guides answer the same question for other situations, plus the national explainers behind the terms used here.
- Business insurance in Arkansas (start here)
- I own an LLC: do I need workers comp?
- I'm a sole proprietor: do I need workers comp?
- I own a corporation (C-corp or S-corp): do I need it?
- We're a partnership: do we need workers comp?
- We're a nonprofit: do we need workers comp?
- My workers are 1099: do I still need it?
- Only part-time or seasonal staff: do I need it?
- I only employ family: do I need workers comp?
- Remote or out-of-state staff: do I need coverage?
- What happens if I don't carry workers comp?
- How much does workers comp cost?
- How do I get workers comp (even if turned down)?
- What insurance do I need for a contractor license?
- Workers compensation insurance, explained
- What workers comp costs (national guide)
- Hiring your first employee: what changes
- Workers comp vs employers liability
- Arkansas cleaning workers comp
This guide is general information, not legal advice. Arkansas rules and penalty amounts can change, so verify current requirements with Arkansas Workers' Compensation Commission or a licensed advisor before you rely on them. Last updated: July 2026.