In almost every U.S. state, employers are required to carry workers’ compensation insurance if they have a certain number of employees. If you’re a business owner in Massachusetts, you must carry workers’ comp insurance if you have at least one employee. Like most states, Massachusetts specifies a few employee types that are exempt from compulsory coverage.

In this article, we’ll go over who you need to cover, who is exempt, and possible penalties for non-compliance.


How does workers’ compensation insurance in Massachusetts work?


The state of Massachusetts requires you to carry workers’ compensation insurance as soon as you have one employee. Employers can obtain coverage by purchasing a policy via the private market.

If you have trouble obtaining workers’ comp from the private insurance market, you can try getting coverage via Massachusetts’ state fund.

A third option is to become a self-insurer, though that means meeting some lofty financial requirements. Companies that self-insure must have at least 300 employees, $750,000 in workers’ compensation premiums, and be able to demonstrate the financial means to pay any and all claims without the help of an insurer.


Who needs workers’ compensation insurance in Massachusetts?


Nearly every employee in Massachusetts must be covered by workers’ compensation insurance, whether they are part-time or full-time workers.

However, domestic employees who work less than 16 hours per week don’t need to be insured. Sole proprietors, partners in partnerships, and independent contractors are also not required to purchase coverage.

If you are a business owner or sole proprietor, that doesn’t mean you shouldn’t get coverage. Sustaining an injury or illness while performing your work can lead to sizable hospital bills, medical costs and a lengthy recovery period. Investing in workers’ comp for yourself could save you from a brutal financial setback.


What are the penalties for not having workers’ comp in Massachusetts?


If you’re found to be non-compliant in the state of Massachusetts, the Department of Industrial Accidents’ Office of Investigations will issue a stop work order. For each day after the stop work order is issued (including weekends and holidays) you will be assessed a fine of $100. Daily fines continue until workers’ compensation coverage is secured and all fines are paid. Employers who receive a stop work order because of workers’ compensation non-compliance can also be barred from receiving public contracts for up to three years.


What does workers’ comp cover?

Medical costs

If one of your employees is injured or becomes ill on the job, workers’ comp can cover their immediate medical expenses such as ambulance rides, emergency room visits, x-rays, surgery and prescription medications.

For example, if a kitchen employee reaches into a sink and slices their hand on a broken glass, they might require medical attention. Workers’ comp could cover the costs of their emergency room visit, stitches and pain management prescriptions.

Lost Wages

Many work-related incidents can leave employees unable to work for several weeks or months. Workers’ comp can provide some relief for employees in the form of partial wage replacement.

If an employee breaks their foot in a work-related accident, they could end up stuck at home for multiple months. While they’re out of work, workers’ comp would cover some of their lost wages.

Ongoing Care

Some work-related injuries require long-term care such as physical therapy or pain management. Often, these injuries are more the result of repetitive workplace stress rather than a single traumatic incident. Chronic back issues for construction workers and carpal tunnel syndrome for office employees are two common examples of the types of workers who might receive ongoing care due to repetitive stress. If their claim is approved, workers’ comp can cover the costs associated with their ongoing care.

Death Benefits

If the unthinkable happens and an employee passes away because of a workplace incident, workers’ comp can cover funeral costs and other death benefits for the deceased worker’s family or beneficiaries.