Class Code

A workers' compensation class code (or classification code) is a four-digit code assigned to a type of work that groups together employees performing similar duties with similar risk levels. Class codes are used to determine workers' compensation insurance rates.

Each class code has a specific rate (expressed as a dollar amount per $100 of payroll) that reflects the expected frequency and severity of injuries for that type of work. High-risk work like roofing or structural steel erection has much higher rates than low-risk work like clerical office employees.

Accurate class code assignment is critical for workers' comp compliance and cost management. Misclassifying employees into lower-rated class codes to reduce premiums is insurance fraud. Conversely, being assigned to a higher-rated class code than appropriate results in overpaying for coverage.