Buying workers’ compensation for:


State Fund: No

Insurance Coverage Requirements: Workers’ Compensation is compulsory in Massachusetts, waivers are not permitted.

Who is Required to Purchase Workers’ Compensation Coverage?

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. Family members must be covered by workers’ compensation insurance, even if they are the only employees of the company.

Members of a Limited Liability Company, partners of an LLP, partnerships, or sole proprietors of an unincorporated business are not required to carry workers’ compensation insurance for themselves. However, under a change to the law in 2002, such members, partners and sole proprietors may now choose to purchase workers’ compensation insurance coverage for themselves. The optional coverage applies ONLY to such members, partners or sole proprietors. Any employee of such organizations who is not a member or partner in the business MUST be covered by workers’ compensation insurance.

Exemption for Certain Corporate Officers

Certain corporate officers may request exemption from coverage under the workers’ compensation law. Any corporate officer who owns at least 25% interest in the corporation may exercise their right to exempt themselves. An exemption DOES NOT apply to employees of the corporation who are not corporate officers; employees must be covered by valid workers’ compensation policy at all times. In order for corporate officers to exercise this right of exemption, all eligible corporate officers must sign the Form 153, stating whether or not they wish to exempt themselves. Members of a Limited Liability Company and partners of an LLP do not have to file the Form 153 to exempt themselves from coverage, as they are considered partnerships.

Factors that Impact Coverage

  • You are a real estate agent: If you work on a commission basis and have a written contract stating you are not treated as an employee under federal tax law, you are exempt from coverage.
  • You are a sole proprietor or partner: In Massachusetts, you are excluded from coverage but have the option to include yourself.
  • You are a corporate officer: You are included in coverage, but officers owning 25% or more interest may exclude themselves by completing the Affidavit of Exemption for Certain Corporate Officers or Directors - Form 153, stating whether or not they wish to exempt themselves. The exemption must be filed with the DIA’s Office of Investigations in Boston for approval.
  • You are a member of an LLC: Massachusetts excludes you from coverage, but you have the option to include yourself. If included the rating payroll used is $41,300.

Failure to Secure Compensation

Employers operating without workers’ compensation coverage will be issued a STOP WORK ORDER by the DIA Office of Investigations, and will be assessed a $100 per day fine commencing on the date of the STOP WORK ORDER and accruing until the date insurance coverage becomes effective and the fine is paid. In addition, the employer may be subject to criminal sanctions including, not more than one-year imprisonment and/or up to a $1500 fine, upon conviction. Uninsured employers may also be subject to debarment from public contracts.

Proof of Coverage is Required

Employers doing business in Massachusetts are required to post a notice in their workplace, with the name of their workers’ compensation insurance carrier. The employer must also indicate the policy number, the effective dates of the policy as well as a contact information on the poster.

The notice must be completed in its entirety, indicating the insurance carrier, the address, policy number and a contact person to whom injuries or incidents should be reported. This is all public information, and must be readily available to any person who needs it. Failure to provide the information to the employee is a violation of the law, and the employer is subject to a fine. There is also an optional space on this notice to list a designated health care provider for initial treatment following an injury.

Independent Contractors

Mistakenly classifying an employee as an independent contractor can result in significant fines and penalties.

View 20 factors used by the IRS and our independent contractor questionnaire to determine whether you have enough control over a worker to be an employer.

Key Resources

Other Tips

If your insured employs workers in multiple states or your insured’s employees are temporarily working out-of-state, they need to purchase insurance for all the states where their workers are located, according to each state’s laws. Call 1-800-476-2948 and let us walk you through it.

The nature of your insured’s business, number of employees being covered and past coverage and claims are all factors in how much their premium will cost.