Most Massachusetts businesses with employees are required to pay for workers’ compensation insurance (WC or workers’ comp insurance). The insurance provides compensation to employees who suffer work-related injuries. Here are some basic facts that you need to know about workers’ comp insurance in Massachusetts as a business owner and employer.
If your Massachusetts business has just one employee, even a part-time employee, you’re generally required to carry workers’ compensation insurance. An exception applies for domestic service (household) employees who work less than 16 hours per week. In addition, business owners, such as members of LLCs, partners in partnerships, and sole proprietors, are not required to be covered by workers’ compensation insurance. However, these business owners do have the option to purchase WC coverage for themselves if they choose.
The Massachusetts Department of Industrial Accidents (DIA), which is part of the state’s Labor and Workforce Department (LWD), is the primary state agency that handles workers’ comp claims. Most of the law for WC insurance is contained in Massachusetts’s Workers’ Compensation Act (Chapter 152 of the Massachusetts General Laws).
In Massachusetts, workers’ compensation insurance is available through private insurance companies. If your business is unable to obtain coverage through a private insurer, you should be able to get coverage through the Beacon Mutual Insurance Company, which is the state’s WC insurer of last resort. There is also an option to self-insure, but this may not be advisable for smaller businesses, in part because it requires that a lot of money be set aside to cover potential claims.
When an injury causes an employee to miss five or more days of full wages, you must report the injury to the DIA. Use Form 101 - Employer's First Report of Injury/Fatality. You must file the form within seven days of the fifth day of employee disability. The form must be filed electronically. After filing the form online, print out three copies:
Beyond these initial steps, there are subsequent steps to the WC claims process, not covered here.
Your WC insurer may either pay the claim for the employee’s injury or deny the claim. If the insurer denies the claim, they can file a Form 110, Employee’s Claim, to request a so-called Conciliation. A Conciliation is an informal meeting between your insurance company and your employee (or his or her attorney). Employers generally don’t attend Conciliations.
If no agreement is reached at the Conciliation, the next step is a Conference, which is an informal proceeding held before an administrative judge. If there is still no resolution, the matter moves to a Hearing, which is a more formal proceeding before the same administrative judge. And from there, a matter can move still further, to a Reviewing Board. Beyond all that, it’s also possible to appeal the matter to the Massachusetts Court of Appeals.
If you don’t carry workers’ compensation insurance, the DIA will issue a Stop Work Order which will require your business to stop operations. In addition, your business will be assessed a minimum fine of $100 per day from the date the Stop Work Order is issued until the date when you have insurance coverage. If you appeal the issuance of a Stop Work Order, the minimum daily fine increases to $250. In addition, you may also be subject to criminal charges, including up to a year in prison and/or a $1,500 fine, if you are convicted. Still further, the DIA will make every effort to collect the expenses paid for an injured worker directly from your business. Many of the penalty rules are contained in Section 25C of Massachusetts’s Workers’ Compensation Act.
There are many other workers’ compensation requirements for Massachusetts employers, such as putting up posters about workers’ compensation coverage where employees can see them, that are not covered here. The Nolo website has a section devoted to workers’ compensation. In addition, the DIA website also contains many useful resources.