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Independent Contractor Test in Oregon

Oregon's wage and hour division applies an economic reality test, while unemployment insurance uses the statutory independent contractor definition in ORS 670.600 (free from direction and control plus an independently established business), not the ABC test.

Last checked . General information, not legal advice.

Oregon at a glance

Test for wage and hour law
Economic reality test
The Bureau of Labor and Industries Wage and Hour Division weighs five factors; no single factor decides.
ABC test for wage law
No
Test for unemployment insurance
ORS 670.600 test (control plus independent business)
Worker must be free from direction and control and customarily engaged in an independently established business, among other criteria.
ABC test for unemployment
No
The statutory test has a control prong and an independent business prong but no usual course of business prong.

Sources

Last checked

The rules in Oregon

Which test does Oregon use to classify independent contractors under its wage and hour laws?

Test for wage and hour law in Oregon: Economic reality test. The Bureau of Labor and Industries Wage and Hour Division weighs five factors; no single factor decides.

Does Oregon apply the ABC test under its wage and hour laws?

No. ABC test for wage law in Oregon: no.

Which test does Oregon use to classify independent contractors for unemployment insurance?

Test for unemployment insurance in Oregon: ORS 670.600 test (control plus independent business). Worker must be free from direction and control and customarily engaged in an independently established business, among other criteria.

Does Oregon apply the ABC test for unemployment insurance?

No. ABC test for unemployment in Oregon: no. The statutory test has a control prong and an independent business prong but no usual course of business prong.

Where do the Oregon independent contractor tests come from?

The rules above come from ORS 657.040 and ORS 670.600. Each source is linked on this page. We last checked them in October 2026.

Good to know

Under ORS 670.600, a person is customarily engaged in an independently established business if at least three of five listed requirements are met (for example a separate business location or bearing the risk of loss).

What this means in practice

Write down how the working relationship actually operates: who sets the hours, who supplies tools, whether the worker serves other clients and whether the work is part of the business's usual line of work. These facts drive every classification test, and a written independent contractor agreement helps only if it matches them.

Check each law separately. A worker can be a contractor under one statute and an employee under another, because wage laws, unemployment insurance, workers' compensation and tax rules may each use their own test. Federal law also applies its own tests alongside the state rules.

Misclassification can lead to back wages, unpaid unemployment contributions, interest and penalties. If a role is close to the line, read the statute and agency guidance for the state where the work is performed, or ask the state labor or unemployment agency how it applies its test.

General information, not legal advice. Laws change, and cities can add their own rules, so check the current statute before you rely on it.