Class Code 3632
Machine Shops – Noc
Class Code 3632 (Machine Shops – NOC) covers employers whose primary business is machining and tool-room work such as turning, milling, drilling, grinding and CNC operations. The approved pure premium rate for California (effective Sept 1, 2026) is $2.600 per $100 of payroll. Accurate classification matters because it drives workers' comp costs and compliance obligations for shop owners and managers.
What Class Code 3632 Covers
This classification applies to shops where the predominant activity is machining and related tool-room operations performed on metal or hard plastics — manual and CNC lathes, vertical and horizontal milling machines, surface and cylindrical grinders, drill presses, EDM and tool sharpening. It includes setup, programming, fixturing, inspection, deburring, coolant handling, and light parts washing when performed as part of machining. It does not typically cover heavy forging, foundry work, large-scale fabrication/welding performed as the primary operation, or final assembly where machining is incidental. Mobile machine services that travel to customer sites to perform on-site machining of parts are usually included when the core activity is machining work. The code is intended for shops that produce or rework precision components, jigs, fixtures, and replacement parts.
Who It Applies To
- Independent job shops and contract CNC machining shops
- Tool rooms and maintenance machining shops inside larger facilities
- Precision aerospace and automotive component machinists
- Small manufacturers that primarily perform in-house machining
- CNC operators, setup technicians, and toolmakers
- On-site mobile machining services where machining is the main activity
Common Job Duties
- Operating manual and CNC lathes, mills, and grinders to machine parts to print
- Programing and setting up CNC equipment, selecting tools and feeds
- Fixturing, measuring and inspection using calipers, micrometers and CMMs
- Deburring, finishing, and cleaning machined components
- Maintaining and adjusting tooling, sharpening cutters, changing inserts
- Handling metalworking fluids/coolants and waste disposal
- Loading/unloading raw stock and finished parts; light material handling
Common Injury Risks
Understanding the $2.600 Rate
The pure premium of $2.600 per $100 of payroll is the WCIRB-approved base cost for expected losses for this class before insurer expense loads and profit. To calculate the pure premium, divide total payroll subject to Class 3632 by 100 and multiply by 2.6 (for example, $500,000 payroll = 5,000 × $2.60 = $13,000 pure premium). Your final premium will differ after applying your insurer's expense constant, experience modification, credits for group or retrospective rating, classification audits, and any deductible or dividend programs.
Cal/OSHA Compliance Requirements
Cal/OSHA enforces machine guarding, lockout/tagout procedures, hazard communication for coolants and solvents, respiratory protection for mists and airborne particulates, and hearing conservation — all codified in Title 8 of the California Code of Regulations. Machine shops must maintain guarding on exposed moving parts, provide training and written procedures for lockout/tagout during servicing, keep Safety Data Sheets (SDS) accessible for all chemical products, and implement routine noise, air monitoring and training where exposures warrant. Proper recordkeeping of training, injury logs and respirator fit tests is also required.
How Key HR Helps Employers Under Class Code 3632
A PEO like Key HR can centralize payroll classification and ensure Class 3632 wages are correctly reported, reducing audit exposure and misclassification risk. Key HR provides California-specific loss-control consulting, standardized safety programs (machine guarding, LOTO, respiratory and hearing programs), managed claims handling and return-to-work coordination to help lower experience mods and overall comp costs. We also streamline OSHA-required documentation, training scheduling, and access to group rating or alternative pricing programs that small shops may not secure on their own.
Get a QuoteFrequently Asked Questions
How do I know if my shop should be classified under 3632 or a different code?
If your business primarily performs machining operations — cutting, turning, milling, drilling, grinding, CNC and tool-room activities — Class 3632 is usually appropriate. If the primary operation is heavy fabrication, welding, foundry work, forging, or assembly where machining is incidental, a different code may apply. Request a payroll and operations review and the insurer or Key HR can confirm classification.
What practical safety steps reduce claims and lower my workers' comp costs?
Critical steps include robust machine guarding, disciplined lockout/tagout for maintenance, mandatory eye/face protection, coolant management and ventilation to limit mist exposures, hearing conservation, regular preventive maintenance, operator training and a formal light-duty return-to-work program. Consistent documentation of training and inspections is essential for both safety and reducing claim costs.
How should I report payroll for mixed operations where machining is only part of the work?
Allocate payroll to the accurate class based on the time employees spend performing each type of work. Employees who perform multiple tasks should have their hours and wages split by operation. Misallocated payroll can trigger audits and premium adjustments, so keep time records or job-costing reports and consult Key HR for correct classification and documentation.
Quick Facts
- Class Code
- 3632
- Classification
- Machine Shops – Noc
- Pure Premium Rate
- $2.600 / $100 payroll
- Effective Date
- September 1, 2026
- Source
- WCIRB Approved Filing
Manage Workers' Comp Through a PEO
Key HR provides pay-as-you-go workers' comp for California employers — no large deposits, no audits, better rates.
Get a Quoteor call (800) 922-4133Ready to Simplify Workers' Comp for Class Code 3632?
Key HR provides California employers with pay-as-you-go workers' comp, HR compliance support, and payroll — all through one PEO partnership.