N.M. Stat. § 52-1-7 (2026)

employees or sole proprietors.
   A. Notwithstanding any provisions to the contrary in the Workers' Compensation
Act, an executive employee of a professional or business corporation or limited liability
company, employed by the professional or business corporation or limited liability
company as a worker as defined in the Workers' Compensation Act, or a sole proprietor
may affirmatively elect not to accept the provisions of the Workers' Compensation Act.

    B. Each executive employee or sole proprietor desiring to affirmatively elect not to
accept the provisions of the Workers' Compensation Act may do so by filing an election
in the office of the director.

     C. Each executive employee or sole proprietor desiring to revoke his affirmative
election not to accept the provisions of the Workers' Compensation Act may do so by
filing a revocation of the affirmative election with the workers' compensation insurer and
in the office of the director. The revocation shall become effective thirty days after filing.
An executive employee shall cause a copy of the revocation to be mailed to the board of
directors of the professional or business corporation or limited liability company.

     D. The filing of an affirmative election not to accept the provisions of the Workers'
Compensation Act shall create a conclusive presumption that an executive employee or
sole proprietor is not covered by the Workers' Compensation Act until the effective date
of a revocation filed pursuant to this section. The filing of an affirmative election not to
accept the provisions of the Workers' Compensation Act shall apply to all corporations
or limited liability companies in which the executive employee has a financial interest.
    E. In determining the number of workers of an employer to determine who comes
within the Workers' Compensation Act, an executive employee who has filed an
affirmative election not to be subject to the Workers' Compensation Act shall be counted
for determining the number of workers employed by such employer.

   F. For purposes of this section:

       (1)    "executive employee" means the chairman of the board, president, vice
president, secretary, treasurer or other executive officer, if he owns ten percent or more
of the outstanding stock, of the professional or business corporation or a ten percent
ownership interest in the limited liability company; and

      (2)     "sole proprietor" means a single individual who owns all the assets of a
business, is solely liable for its debts and employs in the business no person other than
himself.

History: 1953 Comp., § 59-10-4.1, enacted by Laws 1975, ch. 284, § 4; 1979, ch. 368,
§ 5; 1987, ch. 235, § 8; 1993, ch. 193, § 2; 2003, ch. 259, § 3.

                                      ANNOTATIONS

Cross references. — For employers who come within act, see 52-1-2 NMSA 1978.

For coverage by state agencies, see 52-1-3 NMSA 1978.

For application of provisions of act, see 52-1-6 NMSA 1978.

For definition of workman, see 52-1-16 NMSA 1978.

The 2003 amendment, effective June 20, 2003, inserted "or limited liability company"
following "or business corporation" twice in Subsection A; inserted "or limited liability
company" following "or business corporation" at the end of Subsection C; inserted "or
limited liability companies" following "all corporations or" near the end of Subsection D;
and inserted "or a ten percent ownership interest in the limited liability company" near
the end of Subsection F(1).

The 1993 amendment, effective June 18, 1993, in the section heading, substituted
"executive" for "corporations' " and added "or sole proprietors" at the end; in Subsection
A, inserted "executive", deleted "as defined in Subsection F of this section" following
"employee", and inserted "or a sole proprietor"; in Subsection B, inserted "executive"
and "or sole proprietor"; in Subsection C, inserted "executive" and "or sole proprietor" in
the first sentence and substituted "An executive" for "The" in the third sentence; in
Subsection D, substituted "an executive" for "such" and inserted "or sole proprietor" in
the first sentence, and inserted "executive" in the second sentence; inserted "executive"
in Subsection E; and, in Subsection F, deleted the Paragraph (2) designation which
formerly appeared before what now reads "or other" in Paragraph (1), added present
Paragraph (2), substituted "executive employee" for "executive officer" and "or other" for
" 'employee' means an" in Paragraph (1), and made several minor stylistic changes.

Exemption of sole executive employee does not exempt the employer. —
Executive employees may exempt themselves from coverage under the Workers’
Compensation Act, but are still counted in determining whether their employer is subject
to the act. Jackson Constr., Inc. v. Smith, 2012-NMCA-033, 277 P.3d 470.

Where the sole owner of an incorporated construction company was the president and
sole board member of the company; the company did not employ any workers or
executives other than the owner; the owner elected to exempt the owner from coverage
under the Workers’ Compensation Act pursuant to Section 52-1-7 NMSA 1978, and the
owner acknowledged that the owner was an employee of the company, the company
was subject to the act and was required to procure worker’s compensation insurance.
Jackson Constr., Inc. v. Smith, 2012-NMCA-033, 277 P.3d 470.

Directors and officers held not "employees". — Where corporate payments to
directors and officers represented repayment of loans, not wages or salary, the directors
and officers were not "workers" as contemplated by this section. Garcia v. Watson Tile
Works, Inc., 1990-NMCA-126, 111 N.M. 209, 803 P.2d 1114.

Law reviews. — For survey of 1990-91 workers' compensation law, see 22 N.M.L. Rev.
845 (1992).

Am. Jur. 2d, A.L.R. and C.J.S. references. — 82 Am. Jur. 2d Workers' Compensation
§ 175.

99 C.J.S. Workmen's Compensation § 82.