Workers’ compensation (WC) coverage is not just another expense for your business and company that you pay to keep your operations running. It is a statutory policy that safeguards employees in case of work-related illnesses and injuries. But is it essential?
All employers must guarantee that the working environment in which workers spend their time is secure. Accidents can happen even within the safest places of employment. WC insurance offers financial help to staff who encounter work-related injuries or complications for the reimbursement of health care expenses and lost income.
Are you required to have a Workers’ Compensation Insurance?
Even if your Massachusetts business only has one staff, even part-time, you are still required to have WC coverage. An exception will only apply for domestic service staff working less than 16 hours a week. Employers, including limited liability company members, sole proprietors, and joint partners, are not obligated to be protected by WC coverage. They also have the freedom to purchase WC insurance for themselves if they want. In taking full advantage of the WC Massachusetts insurance, the employee will have a limited capacity to sue for additional damages.
Who oversees the Workers’ Compensation Insurance?
The Department of Industrial Accidents (DIA) of Massachusetts, an extension of the state Department of Labor, is the principal state agency responsible for WC insurance reports. Much of this compensation legislation is from the Massachusetts Employees’ Compensation Act (Chapter 152 of the Massachusetts General Laws).
Where can you buy a Workers’ Compensation Insurance in Massachusetts?
Private Massachusetts insurance companies provide compensation coverage for employees. There is also the option of self-insurance. However, it may not be helpful for smaller firms, since it requires that a great deal of money be allocated to compensate for potential claims.
What if the insurer denies the claim?
Your WC provider can either cover the worker’s claim or deny coverage. If the provider refuses to acknowledge the claim, the employee may file a Form 110, Employee’s Claim for a Conciliation. Conciliation is an unofficial meeting between the insurance provider and the employee and their lawyer. Employers rarely attend conciliations.
Unless they reach a deal during the conciliation, the next move is a conference, which is an informal proceeding carried before an administrative judge. If there is still no agreement, the case goes to a tribunal, a more structured trial before the same administrative court. From there, the case can proceed to the Board of Review. Beyond, it is also possible to refer the matter to the Massachusetts Court of Appeals.
What if you do not have a Workers’ Compensation Insurance?
If you do not have a WC insurance, the DIA will impose a suspend-work order forcing the company to cease operations. The company will be liable to a minimum fine of $100 a day from the day they served the Stop Work Order to the day you get insurance coverage. But when you appeal the Stop Work Order, the minimum daily fine increases to $250. If you are found guilty, you will be subject to criminal charges, along with up to one year in county jail and a fine of $1,500. Further, the DIA will push in collecting the benefits to pay the injured employee directly from your company. Most of the fine provisions are in Section 25C of the Massachusetts Workers’ Compensation Act.
WC insurance offers substantial benefits to employers and employees alike throughout Massachusetts. It is a no-fault policy, so it provides benefits regardless of who is at fault.