As a Massachusetts business owner or employer, you may have questions about workers’ compensation (or workman’s comp) law and insurance. It’s important to stay informed and understand your obligations, liabilities and rights as an employer in order to keep you—and those you hire—covered.

Frequently Asked Questions Regarding Workers’ Compensation in Massachusetts

Q. How do I know if I need workers' compensation insurance?

A. According to the Massachusetts Executive Office of Labor and Workforce Development (EOLWD), “With limited exceptions, every employer in the Commonwealth with one or more employee(s) is required by law to have a valid workers’ compensation policy at all times.”

Q. What are the penalties of not having workman’s compensation insurance?

A. Employers operating without insurance are subject to civil fines (up to $250) and/or criminal penalties (up to $1500), including imprisonment (up to a year), and are subject to a STOP WORK order issued to their business. You may also be prohibited from bidding or participating in any state or municipal funded contracts for three years. For more information, see the Labor and Workforce Development website.

Q. How do I determine the difference between an employee, a subcontractor and an independent subcontractor?

A. The State of Massachusetts considers as an employee “every person in the service of another under any contract of hire, express or implied, oral or written,” however there are exceptions based on certain circumstances. In order to officially determine the legal status of anyone in your employ, contact the Office of Legal Counsel in Boston at (617) 727-4900 ext. 7423.

Q. Where do I get Worker’s Compensation Insurance?

A. If you are in the automotive, roads and fuels industry, NARFA offers discounts, claim management and other valuable resources under the Automotive Industries Compensation Corporation (AICC) program. You can also visit the Workers’ Compensation Rating and Inspection Bureau website for more information on workman’s comp across the state.

Q. What do I do if an incident occurs?

A. According to worker’s compensation law in Massachusetts, if an incident occurs that results in a period of at least five consecutive days of disability, you have up to seven calendar days to report the incident to Department of Industrial Accidents (DIA) and your insurer (make sure you also give a copy of the paperwork to the injured employee). If you are not informed of the injury until after the period of disability, you have seven days to report the injury from the date you were notified. Visit the Massachusetts DIA website for more information on workers comp claims.

Q. Do I need to cover myself?

A. If you are the sole proprietor of a business that is not incorporated, you are not required by Massachusetts law to have workers’ compensation insurance coverage. However, if you are asked by a contractor to obtain workers’ comp, you may purchase a workers’ compensation policy for yourself.

Q. What can I do to lower my liability and make my workplace safe?

A. Attend industry-specific events and seminars to learn best practices and ways that other businesses like yours are having success in the workplace. Official state entities such as Massachusetts Department of Labor Standards and Massachusetts Workplace Safety and Health Program also have helpful workplace safety resources online. The Department of Labor Standards also offers free consultation for small business owners that includes advice, training and possible temporary exemption from OSHA inspections.

For more information on protecting yourself and your employees, visit our Workers’ Compensation in Massachusetts page.

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