Oklahoma Independent Contractor Agreement Template

Introduction

Key Things to Know

1. 1

   Oklahoma's unemployment test is frozen to a named federal document rather than to the common law generally. 40 O.S. 1-210(14) provides that services performed by an individual for wages are deemed employment subject to the Employment Security Act of 1980 if the services are performed in an employer-employee relationship using the twenty-factor test used by the Internal Revenue Service in Revenue Ruling 87-41, 1987-1 C.B. 296. Because the reference is to a specific 1987 ruling, the state test does not drift with later IRS guidance the way an open-ended reference would.

2. 2

   The same paragraph creates a jurisdictional bar that is easy to overlook. 40 O.S. 1-210(14) states that the Oklahoma Employment Security Commission shall have the exclusive authority to make a determination of whether an individual is an independent contractor or employee. The definition of employment at 40 O.S. 1-210(1)(b) routes to that paragraph for the usual common law rules.

3. 3

   The workers' compensation act reaches unwritten arrangements as readily as written ones. 85A O.S. 2(18)(a) defines an employee as any person, including a minor, in the service of an employer under any contract of hire or apprenticeship, written or oral, expressed or implied, excluding one whose employment is casual and not in the course of the trade, business, profession, or occupation of the employer. Putting nothing in writing does not move a worker out of the definition.

4. 4

   A dated change is coming to the workers' compensation definition. The version of 85A O.S. 2 in force through October 31, 2026 contains no independent contractor test. An amended version taking effect November 1, 2026 adds one, so an agreement signed before that date sits under a different statutory text from one signed after it.

5. 5

   That new test is narrower than it looks. The four of five factor test added effective November 1, 2026 is appended to the agriculture, ranching, and horticulture exclusion at 85A O.S. 2(18)(b)(2). It applies to an independent contractor who meets at least four of five listed conditions, which cover controlling how the work is performed, being able to work for others without going through an employment process, being paid on a per-job, competitive-bid, or contract basis, the ability to profit or lose based on business receipts rather than expenditures, and having continuing business obligations, liabilities, and a chance of profit or loss. It is not a general workers' compensation test.

6. 6

   The Oklahoma Minimum Wage Act supplies no classification test. The words independent contractor do not appear in its definitions at 40 O.S. 197.4, which define employ as to suffer or to permit to work and define employee as any individual employed by an employer with a list of exclusions. The exclusions are occupational and structural rather than control-based.

7. 7

   The state wage act also has a narrow practical reach. 40 O.S. 197.4(d) limits employer to those hiring more than ten full-time employees or equivalent at any one location or place of business, unless annual gross business exceeds one hundred thousand dollars, and 40 O.S. 197.4(e)(7) excludes employees of an employer subject to a federal wage and hour law who is paying the minimum wage under that law. For many Oklahoma engagements the operative wage analysis is the federal one.

Oklahoma Requirements for Independent Contractor Agreement

• Oklahoma Unemployment Adopts IRS Revenue Ruling 87-41 (40 O.S. 1-210(14))

  Services performed by an individual for wages are deemed employment subject to the Employment Security Act of 1980 if the services are performed in an employer-employee relationship with the employer using the twenty-factor test used by the Internal Revenue Service in Revenue Ruling 87-41, 1987-1 C.B. 296. The reference is to a specific named ruling rather than to the common law generally, so the analysis should be run against those twenty factors as stated in that ruling.

• Oklahoma Employment Security Commission Exclusive Authority (40 O.S. 1-210(14))

  The same paragraph provides that the Oklahoma Employment Security Commission shall have the exclusive authority to make a determination of whether an individual is an independent contractor or employee. This allocates the unemployment classification question to a single forum, so a contractual recital of status does not remove the question from the agency's determination.

• Oklahoma Unemployment Definition Routes to the Common Law Rules (40 O.S. 1-210(1)(b))

  Employment includes service performed by any individual who, under the usual common-law rules applicable in determining the employer-employee relationship as provided in paragraph 14 of the section, has the status of an employee. The definitional provision therefore does not stand on its own; it points back to the twenty-factor paragraph, which is where the operative test lives.

• Oklahoma Workers' Compensation Employee Definition (85A O.S. 2(18)(a))

  Employee means any person, including a minor, in the service of an employer under any contract of hire or apprenticeship, written or oral, expressed or implied, excluding one whose employment is casual and not in the course of the trade, business, profession, or occupation of the employer, and excluding certain persons required to perform work after conviction or while incarcerated. Because the definition reaches oral and implied arrangements, the presence or absence of a written contract does not by itself determine coverage.

• Oklahoma Workers' Compensation Text Changes on November 1, 2026 (85A O.S. 2)

  Two texts of this section are in play. The version in force through October 31, 2026 contains no independent contractor factor test. An amended version effective November 1, 2026 adds one within the agricultural exclusion. Identify which text governs by reference to when the services are performed, and do not carry an analysis run under one text across the effective date without rechecking it.

• Oklahoma Agricultural Exemption Four of Five Conditions (85A O.S. 2(18)(b)(2), effective November 1, 2026)

  Effective November 1, 2026, the agriculture, ranching, and horticulture exclusion applies to an independent contractor who meets at least four of five conditions: performing specific services or work for a specific payment while controlling how the work is performed; being able to perform work for others at the contractor's own election without going through an employment process; receiving compensation on a per-job, competitive-bid, or contract basis rather than as an employee; being able to incur profit or loss based on business receipts instead of expenditures; and having continuing business obligations, liabilities, and a chance of profit or loss. This test is scoped to that exemption and is not a general workers' compensation standard.

• Oklahoma Minimum Wage Act States No Classification Test (40 O.S. 197.4(c), (e))

  The Oklahoma Minimum Wage Act defines employ as to suffer or to permit to work and employee as any individual employed by an employer, subject to an enumerated exclusion list. It states no control test, no ABC test, and no economic realities language, and the words independent contractor do not appear in the definitions. A wage classification position should not be built on a state statutory test that the act does not contain.

• Oklahoma Minimum Wage Act Coverage Thresholds (40 O.S. 197.4(d), (e)(7))

  Employer is limited to those hiring more than ten full-time employees or equivalent at any one location or place of business unless annual gross business exceeds one hundred thousand dollars, and the definition of employee excludes any employee of an employer subject to a federal wage and hour law who is paying the minimum wage under that law. Confirm whether the state act reaches the engagement before treating its silence on classification as the end of the wage analysis.