Does My Business Need Massachusetts Workers Compensation?
Posted on Mon, Jun 14, 2010
The Massachusetts workers compensation system is in place to make sure that workers are protected by insurance if they are injured on the job or contract a work-related illness. Below are answers to some common employer questions about workers compensation.
I am the owner of a very small business, with only a few employees. Do I need workers' compensation insurance?
All employers in Massachusetts are required by state law to carry workers' compensation insurance covering their employees, including themselves if they are an employee of their company. This requirement applies regardless of the number of hours worked in any given week, except that domestic service employees must work a minimum of 16 hours per week in order to require coverage.
I own a small business. The only person working with me is my wife (or son, or brother). Do I need workers compensation insurance?
Yes, family members must be covered by workers' compensation insurance, even if they are they only employees of the company.
I am a corporate officer, the sole owner of the corporation. I have two employees working for me; I know I need workers' compensation insurance for my employees, but do I have to cover myself?
No; on July 25, 2002, a change in the workers' compensation law went into effect which allowed corporate officers who own at least 25 % of the corporation to exempt themselves from WC coverage. Such corporate officers can file the Affidavit of Exemption for Certain Corporate Officers - Form 153 with the Department of Industrial Accidents (DIA) to exempt themselves. This change does not affect the requirement that all employers cover their employees with Workers Compensation insurance.
I'm self-employed, the sole proprietor of my company which is not incorporated; do I need to get workers' compensation insurance for myself?
As the sole proprietor of an unincorporated business the law does not require you to insure yourself. However, under a recent change to the law, sole proprietors and partnerships (that have no employees) can now obtain insurance if they so choose. If you do work for a general contractor they may want you purchase a policy in order to work on a particular job they are overseeing.
I am the owner of a business outside of Massachusetts and have been hired to do some work in Mass., do I need to get a Massachusetts workers comp policy?
Out of state employers are required to cover all their employees, who are working in Massachusetts, with workers' compensation benefits under Massachusetts law. You do not need to buy a policy strictly for Massachusetts if in your existing workers' comp policy Massachusetts coverage is listed in Section 3.A of the policy's Information Page.
If Massachusetts is specifically listed in Section 3.C of the Information Page, the policy is acceptable only if the Insurer (insurance carrier) verifies the coverage in Massachusetts. The Insurer must forward a statement verifying workers' compensation coverage in Massachusetts to the Office of Investigations. If the Insurer fails to meet this requirement, a Stop Work Order is immediately issued.
Furthermore, any notation in Section 3.C of the policy's information page that "all states are covered" or "all states are covered except those listed in Item 3.A and the States of: North Dakota, Ohio, Washington and Wyoming" or something similar is acceptable only upon verification of workers' compensation coverage in Massachusetts by the insurer. The insurer must forward a statement verifying workers' compensation coverage in Massachusetts to the Office of Investigations. If the insurer fails to meet this requirement, a Stop Work Order shall be issued immediately.
From: Mass.gov