Restaurant Workers' Comp in Alabama
What Alabama requires of restaurants and bars for workers' compensation — when it kicks in, who's exempt, and what it costs.
Reviewed by J. Robert Smith, Licensed Insurance Agent (NPN 10378680). Last updated .
Yes, but only above a threshold. Alabama requires workers'-compensation coverage once a business regularly employs five or more employees, so most restaurants with a full staff must carry it. Full-time and part-time workers, corporate officers, and LLC members all count toward the five. Employers with fewer than five may voluntarily elect coverage.
- Required?
- Yes
- Kicks in at
- 5 or more employees (full- or part-time); corporate officers and LLC members count. Fewer than 5 are exempt but may elect coverage.
- Restaurant rate
- NCCI 9082 (restaurants) approx. $1.10–$1.40 per $100 payroll; 9083 (fast-food/limited-service) approx. $1.20–$1.60. Low-to-moderate hazard tier. Approximate, industry tier.
- Market
- Competitive private market with no state fund; coverage available from private carriers, the Alabama Assigned Risk Pool, group self-insurance, or approved individual self-insurance.
Is workers’ comp required for a restaurant in Alabama?
Alabama requires workers' compensation once you reach 5 or more employees (full- or part-time); corporate officers and LLC members count. Fewer than 5 are exempt but may elect coverage.. Businesses regularly employing fewer than five workers are not required to carry coverage. Employers of domestic employees, farm laborers, and casual employees, plus municipalities under 2,000 population, are exempt but may elect coverage; contractors are excluded from the employee count.
What restaurant workers’ comp costs in Alabama
The restaurant class-code rate in Alabama is NCCI 9082 (restaurants) approx. $1.10–$1.40 per $100 payroll; 9083 (fast-food/limited-service) approx. $1.20–$1.60. Low-to-moderate hazard tier. Approximate, industry tier.. Your premium is that rate applied per $100 of payroll and adjusted by your experience modifier, so it scales with how many people you employ and your claims history. Competitive private market with no state fund; coverage available from private carriers, the Alabama Assigned Risk Pool, group self-insurance, or approved individual self-insurance.
What owners in Alabama miss
- Alabama's five-employee trigger is one of the highest in the nation, so many small restaurants fall below it.
- The employee count deliberately includes corporate officers and LLC members, which can push a small operation over the threshold.
- Residential/home-building construction employers must carry coverage regardless of employee count.
- Individual self-insurance requires roughly $5 million net worth.
Sources
- Alabama Department of Labor: How many employees must you have before coverage is mandatory? (FAQ)primaryretrieved 2026-07-27
- Alabama Department of Labor: Insurance Requirement Informationprimaryretrieved 2026-07-27
- OnPay: Alabama workers' compensation insurance: employer's guideindustryretrieved 2026-07-27
Cost examples are illustrative national figures gathered from public filings and industry surveys. They are not quotes. Your actual premium depends on your state, carrier, revenue, payroll, location, and coverage selections. Restaurant Insurance Authority is an insurance marketing and referral service, not an insurer or licensed agency. We connect business owners with licensed independent commercial-lines agents who specialize in food and beverage. Questions? Call (855) 480-1410.
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