Jump ahead to learn:
- Is Workers’ Compensation insurance required in Massachusetts?
- How does Workers’ Comp work in MA?
- Workers’ Compensation benefits in Massachusetts
- MA Workers’ Compensation death benefits
- Massachusetts Workers’ Compensation insurance rates
- What if you don’t have Workers’ Compensation in Massachusetts?
- Who is exempt from MA Workers’ Compensation insurance rules?
- How NEXT helps Massachusetts business owners
Is Workers’ Compensation insurance required in Massachusetts?
Yes, all employers operating in the Commonwealth of Massachusetts must have workers’ compensation insurance for their employees and themselves if they are an employee of their own company. In Massachusetts, an employee is defined as “every person in the service of another under any contract of hire, express or implied, oral or written.”
The only exception is for domestic workers who must work at least 16 hours a week to be covered under a workers’ compensation policy.
Even family members must be covered by workers’ comp even if they are the only employees of the business.
Some employers may qualify for a self-insurance license. To qualify, employers must have at least 300 employees and $750,000 in annual standard premium.
How does Workers’ Comp work in MA?
In Massachusetts, the workers’ compensation system helps pay for any reasonable and necessary medical treatment related to workplace injuries or illnesses. It also pays compensation for lost wages after five calendar days of full or partial disability.
Typically, workers’ compensation in MA helps cover:
- Medical expenses
- Lost wages
- Rehabilitation and physical therapy services
- Retraining if you can no longer do your job
- Permanent injury
- Death benefits and survivor benefits
If an employee experiences a work-related accident or illness that results in at least five days of lost work time, you must report it to the state within seven days of the lost time. The Massachusetts Department of Industrial Accidents (DIA) administers the state’s workers’ compensation laws.
The first 180 days are considered a “Pay-Without-Prejudice” period, where the insurer may pay benefits without making a final decision.
Workers’ Compensation benefits in Massachusetts
Ill or injured workers can be eligible for the following workers’ comp benefits:
- Temporary total incapacity benefits. 60% of the employee’s gross average weekly wage of the 52 weeks before injury. This benefit lasts for 156 weeks.
- Temporary partial incapacity benefits. Up to 75% of the employee’s weekly total temporary benefits. The benefit lasts for up to 260 weeks.
- Permanent and total incapacity benefits. 66% of the employee’s gross average weekly wage. There is also an annual cost-of-living adjustment (COLA). This benefit lasts for as long as the employee is disabled.
- Medical benefits. Benefits include medical care, prescription reimbursement, mileage reimbursement and more. This benefit typically lasts for as long as medical services are required.
- Scarring and permanent loss of function and disfigurement. A one-time payment for the employee’s disfigurement or scarring, plus associated payments like medical bills or lost wages.
Sometimes, all parties may agree to a one-time, lump-sum payment instead of weekly compensation checks. Typically, when accepting the lump sum, the employee must give up certain rights.
MA Workers’ Compensation death benefits
If an employee has died as a result of a work-related injury or illness, their spouse, children and other dependents are eligible for survivor benefits. Children are eligible only if they are under age 18, are full-time students, or are unable to work because of physical or mental disabilities.
Surviving spouses can receive weekly benefits equal to 66% of the deceased worker’s average weekly wage up to the state’s maximum. They also become eligible for yearly cost-of-living adjustments two years after the injury or illness.
Workers’ comp coverage can also help pay for funeral expenses. Policies can pay burial costs up to eight times the state’s average weekly wage at death.
Massachusetts Workers’ Compensation insurance rates
Workers’ compensation costs vary across industries. Factors that influence price include:
- The number of employees and the type of work they do
- Your total payroll
- Your insurance claims history
- The locations where you do business
The best way to determine the insurance rate for your business is to get a free instant quote from NEXT.
What if you don’t have Workers’ Compensation in Massachusetts?
Businesses without workers’ compensation insurance coverage can face severe consequences. The DIA will issue a stop work order (SWO) to employers without coverage and fine them $100 per day, including weekends and holidays. The fines will accrue until insurance coverage starts and the fine is paid.
If you don’t appeal the SWO, your business must close until proof of coverage is provided to the DIA and the fines are paid. However, if you appeal your SWO, the fines go up to $250 per day, and your business can remain open.
Employers who are issued SWOs may be subject to criminal charges, including up to one year in prison and/or up to a $1,500 fine upon conviction. Further, uninsured employers are also subject to debarment from public contracts for three years.
Who is exempt from MA Workers’ Compensation insurance rules?
The state of Massachusetts requires all employers to carry workers’ comp insurance. However, there are a few exceptions.
- Members of a limited liability corporation (LLC), partners in a limited liability partnership (LLP), or sole proprietors of an unincorporated business aren’t required to carry coverage for themselves. (This exemption doesn’t include employees who aren’t members of the LLC or LLP. They must still be covered.)
- Corporate officers who own at least 25% interest in the corporation can request an exemption.
- Seaman engaged in interstate/foreign commerce.
- Real estate and consumer goods salespeople who have a written contract stating that they are not treated as employees under federal tax law.
- Taxi drivers who lease their cabs and who are not treated as an employee under federal tax law.
- Persons engaged in interstate/foreign commerce who are covered by federal law for compensation for injury or death.
How NEXT helps Massachusetts business owners
NEXT can give you a free workers’ compensation coverage quote in about 10 minutes. Small business owners can buy affordable coverage online and instantly share a certificate of insurance at no extra cost.
You can manage your policy 24/7 via web or mobile app.
And if you have questions, our licensed, U.S.-based insurance professionals are available to help.
We strive to resolve every workers’ compensation claim quickly. Learn more about our claims process and how our claims advocates will work with you after an employee injury.
