If you run a California partnership, and it has any employees, yes, it must carry workers compensation insurance from the first worker under Labor Code section 3700. General partners are themselves covered employees by default when they work for the firm, and a partner can be left off the policy only by signing a formal waiver. A partnership with no employees other than the partners is generally not required to carry a policy, but the partners are still in by default unless they waive out.
Who this is for: General partners in a California partnership, whether a two-partner shop with no staff or a partnership with a payroll of employees.
The short version
- A California partnership with any non-partner employees must carry workers comp from the first hire.
- Each general partner is a covered employee by default and can be left off only by signing a written waiver, under penalty of perjury.
- There is no minimum ownership percentage for a general partner to waive out.
- Employees of the partnership are always covered; the include-or-exclude choice applies to the partners.
- General partners can be personally exposed if an uninsured worker sues the firm.
How partners are covered
Since California's 2017-2018 changes (AB 2883 and SB 189), a general partner is included as a covered employee by default when they render service to the partnership. To be left off, a partner signs a written waiver, under penalty of perjury, stating that they are a qualifying general partner, and delivers it to the insurer. There is no ownership-percentage floor for a partner to waive out, and the interest can be held in a revocable trust. So the firm decides, partner by partner, whether each one stays on the policy or waives off. Partners who do physical or field work often stay covered; partners who only manage the business often waive out.
Partners and staff on one policy
| Who | Default if the firm has a policy | Notes |
|---|---|---|
| General partner | Included unless waived | Each partner may sign a waiver to opt out |
| Employee of the partnership | Covered | Employees are always covered by the policy |
| Firm with only partners, no employees | Not required, but partners are in by default | Partners may waive off if they take a policy |
| Firm with one or more employees | Coverage required | Every employee must be covered from day one |
Why personal exposure raises the stakes
In a general partnership, the partners can be personally liable for the firm's obligations. If the partnership fails to carry required comp, an injured worker can sue in civil court, where the law presumes the injury was the firm's fault and removes the defenses that the worker was careless, knew the risk, or was hurt by a co-worker. Because a judgment can reach the partners personally, going uninsured concentrates risk on the very people who own the business. Carrying a policy makes comp the worker's exclusive remedy and generally blocks the lawsuit, protecting both the firm and the partners.
An Oakland example
Illustrative, not a quote. Two partners run a plumbing partnership in Oakland with three employed plumbers. Both partners still work in the field, so they stay on the policy rather than waive off, and they cover all three employees. A general contractor they subcontract for requires proof of coverage, which the firm produces right away because the policy is already in place. When an employee strains his back lifting a water heater, comp pays and the partnership keeps its exclusive-remedy protection. The partners ask us to review their payroll so the plumbing work is rated correctly.
Real questions California owners ask
Does a California partnership have to carry workers comp?
If it has any employees other than the partners, yes, from the first hire. A firm with only partners and no employees generally is not required to carry it, though partners are covered by default.
Am I covered as a general partner?
By default, yes. Since California's 2017-2018 changes, you are an included, covered employee as a general partner when you work for the firm. You can be left off only by signing a written waiver under penalty of perjury.
Can one partner be covered and another opt out?
Yes. Coverage is decided partner by partner. A partner who does field work can stay on the policy while a partner who only manages the office signs a waiver to reduce premium.
Is there a minimum ownership share to opt out as a partner?
No. Unlike corporate officers, a general partner does not need a minimum ownership percentage to waive out. Any qualifying general partner can sign the waiver and be left off the policy.
Are our employees covered if the partners opt out?
Yes. Waiving off the partners does not affect the staff. Employees of the partnership are always covered by the policy regardless of whether the partners stay on or waive out.
Can an injured worker reach the partners personally?
In a general partnership, partners can be personally liable for the firm's obligations, so a judgment can reach them. Carrying comp makes it the worker's exclusive remedy and generally blocks that lawsuit.
Is workers comp the same as our general liability policy?
No. General liability covers harm to other people and their property, while workers comp covers your own workers' on-the-job injuries. A client contract may require both, and they do different jobs.
Why California owners choose Morrow
- We shop the right market for you. In California you buy workers' comp on the open market from any licensed private carrier, with the State Compensation Insurance Fund competing alongside them and standing as the insurer of last resort, so we can shop your rate freely and still have a guaranteed fallback for hard-to-place accounts.
- 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 California guides
Every California 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 California (start here)
- Workers comp: the owner's overview
- 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 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)
- Do sole proprietors need workers comp?
- What workers comp does not cover
- California plumber workers comp
This guide is general information, not legal advice. California rules and penalty amounts can change, so verify current requirements with California Division of Workers' Compensation (DWC), a division of the Department of Industrial Relations (DIR) or a licensed advisor before you rely on them. Last updated: July 2026.