The Oregon Workers' Benefit Fund (WBF) assessment is a cents-per-hour payroll charge. Employers and employees split it, and the employer remits both halves. For 2026 the rate is 1.8 cents per hour worked, 0.9 cents from the employer and 0.9 cents withheld from the employee. The state has announced it will rise to 2.2 cents in 2027, with a new BOLI component added on top. This guide explains what the assessment pays for, who owes it, how to count hours, and where it goes wrong on payroll.
TL;DR
- The 2026 WBF rate is 1.8 cents per hour worked, split equally: 0.9 cents from the employer and 0.9 cents from the employee.
- For 2027 the rate is announced at 2.2 cents per hour, plus a new BOLI Expenses Fund component of 0.2 cents per hour.
- The WBF is not workers' compensation insurance. Paying it gives you no coverage, so keep it separate from your premium and the premium assessment.
- You report it on the Oregon Quarterly Tax Report (Form OQ), but the workers it covers can differ from those subject to unemployment insurance.
- If you pay the employee's half yourself, Oregon treats it as a taxable benefit to the employee.
Table of Contents
- What the Workers' Benefit Fund pays for
- Oregon WBF rate by year
- Who has to pay the assessment
- How to count hours correctly
- Reporting and paying the WBF
- Paying the employee's share yourself
- Why the WBF matters to owners with multiple entities
- Our perspective
- When to bring in a tax professional
- FAQ
- Sources
What the Workers' Benefit Fund pays for
The WBF is a state-managed fund. It funds return-to-work programs, provides increased benefits over time for workers who are permanently and totally disabled, and gives benefits to families of workers who die from workplace injuries or diseases. The two major programs paid from it are cost-of-living increases for those disabled workers and beneficiaries, and the Re-employment Assistance Program, which helps injured workers get back to work.
The fund is not a pot you can claim from as an employer. It is a statewide pool, financed by cents-per-hour assessments on both employers and employees.
How the rate is set
The Department of Consumer and Business Services (DCBS) sets the rate each year. The goal is a fund balance of at least 12 months of projected expenditures, so the long-term benefits stay funded without big swings for businesses. The authority comes from ORS 656.506, which requires every employer to retain the employee's amount from earnings for each hour or part of an hour worked and pay it over.
Oregon WBF rate by year
The rate has moved in small steps. These figures come from the state's WBF page and DCBS cost page.
| Year | Rate per hour worked | Employer share | Employee share |
|---|---|---|---|
| 2023 | 2.2 cents | 1.1 cents | 1.1 cents |
| 2024 | 2.0 cents | 1.0 cent | 1.0 cent |
| 2025 | 2.0 cents | 1.0 cent | 1.0 cent |
| 2026 | 1.8 cents | 0.9 cents | 0.9 cents |
| 2027 (announced) | 2.2 cents, plus 0.2 cents for BOLI Expenses Fund | Confirm split with DCBS | Confirm split with DCBS |
The 2026 reduction was set through a permanent administrative order that lowered the rate to 1.8 cents per hour for calendar year 2026. The 2027 change matters for budgeting: the BOLI Expenses Fund component is new in 2027 and adds 0.2 cents per hour worked. Before you update payroll software in January, check the current DCBS rate notice for how the combined amount is divided between employer and employee.
Who has to pay the assessment
Every employer subject to Oregon's workers' compensation law must pay it. It applies to all paid workers required to be covered. It also applies to individuals, including owners and officers, who are otherwise non-subject but whom you choose to cover under a voluntary workers' compensation policy.
That last point catches owners. If you elect coverage for yourself or a corporate officer, expect their hours to enter the WBF calculation. If you do not elect coverage and the person is non-subject, they are outside it. The state publishes a booklet that addresses only the WBF assessment, and it is the place to settle borderline cases. For subjectivity questions, the Oregon combined payroll report lists the DCBS contact numbers.
Three charges that are easy to mix up
Oregon workers' compensation costs involve three different items. Keeping them separate is essential for accurate payroll reporting:
- The insurance premium, paid to your insurer for coverage.
- The premium assessment, a percentage of premium. DCBS says it will stay at 9.8 percent in 2027, with different percentages for self-insured employers and groups.
- The WBF assessment, a cents-per-hour amount on hours worked.
Paying the WBF does not give you any coverage. It is a statutory assessment on payroll hours, separate from the policy that actually protects your business.
How to count hours correctly
The base is hours, not dollars. Per the 2026 Oregon combined payroll tax report instructions, include all full and partial hours worked by every paid individual subject to Oregon's workers' compensation law, including salaried and other non-hourly workers. Round the total down to the nearest whole hour when you report.
Those hours may not match what you report for unemployment insurance, because the subject-worker definitions differ. Do not copy the UI hours into the WBF line without checking who is covered under each.
A worked example
Say a landscaping company has 10 subject employees, each working 2,080 hours in 2026. That is 20,800 hours.
- Total 2026 assessment: 20,800 × $0.018 = $374.40
- Employer half: $187.20
- Employee half: $187.20 total across the crew, or $18.72 per employee
At the announced 2027 rate of 2.2 cents on the same hours, the base assessment is 20,800 × $0.022 = $457.60. The BOLI component at 0.2 cents adds $41.60 on the same hours, for $499.20 combined. These figures are our arithmetic from the published rates, not a state calculation, so confirm against the final 2027 notice.
The dollar amounts are small. The risk is in the reporting: undercounted hours, a wrong rate, or the wrong people included.
Reporting and paying the WBF
You report the WBF with your other payroll taxes on the Oregon Quarterly Tax Report (Form OQ). The DCBS administers the assessment, while the Department of Revenue provides the filing channel. Use the contacts on the report: subjectivity questions go to DCBS's workers' compensation employer line, and assessment questions go to a separate number listed there.
A practical routine:
- Pull total hours for every subject worker each quarter, including salaried staff.
- Apply the rate for the period and split it between employer and employee.
- Confirm each employee's half was deducted from gross pay.
- Reconcile WBF hours against your workers' compensation audit hours at year end.
- Update the rate in payroll software before the first payroll of the new year.
Paying the employee's share yourself
Some employers absorb the employee half as a courtesy. Oregon requires the employee portion to come out of gross pay, and if the employer pays it instead, the Department of Revenue treats it as a taxable benefit. That raises the employee's taxable gross wage for other tax purposes. On a 2026 hourly basis the amount is tiny, but the treatment still has to be right on the W-2 and in payroll tax calculations. Covering the half is allowed as a business choice; ignoring its tax effect is where problems start.
Why the WBF matters to owners with multiple entities
Owners with several businesses face a bookkeeping problem more than a cost problem. Each entity with subject workers has its own hours, its own workers' compensation policy and its own filings. Shared staff who split time between entities need hours allocated cleanly, or you risk reporting the same hours twice or not at all.
Owner-employees add another layer. Whether an S corporation owner has workers' compensation coverage, and how their wages and fringe benefits are reported, affects what hours are subject. Our guide on what S corp owners must report on the W-2 covers the reporting side. If you are also managing payments through the year, see estimated taxes for Oregon S corps. And for the other Oregon business levy that trips up growing companies, read our Oregon CAT explainer.
Our perspective
We work with business owners netting $300,000 to $1,000,000 a year, many with several entities and payroll in more than one state. In that setting, the WBF is rarely a tax strategy question. It is a compliance hygiene question. The assessment is small, but the same mistakes repeat: hours pulled from the wrong report, owners included or excluded without a documented decision, and the three workers' compensation charges blended into one line.
Our view is that small recurring items deserve a written process, not memory. Decide who is subject, document why, and have the hours reconciled once a year against your insurance audit. That is an hour of work that prevents a notice, and it keeps the books clean when a lender or a buyer reviews them. It also frees your attention for the decisions that move real money, like entity structure and owner compensation.
The 2027 increase and the new BOLI component are a reminder to check payroll settings every January, not only when something breaks.
— Melissa
When to bring in a tax professional
You can handle the WBF on your own if you have one entity, a simple payroll and clear subject status. Get help when:
- You own several entities and share employees between them.
- You are unsure whether an owner or officer is subject, or covered voluntarily.
- You moved operations between Oregon and another state and need hours split. Our notes on moving from Oregon to Idaho show how those splits play out.
- You received a notice and need a response, or you owe back payroll amounts. See our back taxes payment plan guide for Oregon.
For a dispute about workers' compensation coverage or subjectivity, contact the DCBS Workers' Compensation Division directly. For tax treatment of your entities, owner pay and payroll, we can help. Our year-round advisory plans are Monthly Tax Advisory at $11,997 per year and Quarterly Tax Strategy Sessions at $9,497 per year. If you own an S corporation and want the owner pay and payroll structure reviewed first, the S-Corp Tax Strategy Accelerator is $997 one-off.
FAQ
What is the Oregon Workers' Benefit Fund rate for 2026?
It is 1.8 cents per hour worked, down from 2.0 cents in 2025. The cost is shared equally, so employers and employees each pay 0.9 cents per hour. The employer withholds the employee's half and remits both.
Is the WBF the same as workers' compensation insurance?
No. Paying the WBF assessment gives you no coverage. It is an additional statutory charge on payroll hours. Your insurance premium and the premium assessment are separate items.
Do I count salaried employees' hours?
Yes. Include full and partial hours for all paid subject individuals, salaried or not, and round the total down to the nearest whole hour. Estimate actual hours worked if you do not track them, and keep the method on file.
Will the rate change in 2027?
Yes. DCBS says the WBF assessment will increase to 2.2 cents per hour in 2027, and a BOLI Expenses Fund component adds 0.2 cents. Check the final rate notice before you update payroll.
Can I pay my employees' share for them?
You can, but Oregon treats it as a taxable benefit to the employee. It increases their taxable gross wage for other tax purposes, so payroll has to reflect it.
Sources
- Workers' Benefit Fund, DCBS
- Workers' Benefit Fund (WBF) Assessment booklet, DCBS
- Workers' Benefit Fund assessment, Oregon Department of Revenue
- 2026 Oregon Combined Payroll Tax Report
- Workers' Benefit Fund 2025 Annual Update
- Workers' Benefit Fund benefits, DCBS
- Oregon Workers' Compensation Costs, DCBS
- ORS 656.506
- 2026 Workers' Benefit Fund Assessment Rate, administrative order