Employees are essential to many businesses. From greeting clients at the front desk to producing products and providing services, your employees work hard for you every day to make your business a success. If one of them is hurt on the job, this success may be jeopardized and company morale may suffer. Workers compensation insurance can help protect your employees and your company, and is required under Massachusetts law. When a worker is injured, they must seek medical care and take time to recover, while you face the choice of losing productivity, losing income to hire a temporary replacement, or not paying your injured employee.
In Massachusetts, all employees of a business must be covered by workers comp insurance, regardless of the number of hours worked. This includes the employer, with some exceptions made for corporate officers. Domestic service employees that work more than 16 hours per week must also be covered by a workers compensation policy.
Businesses must also clearly display a notice to employees including the name of the insurer providing coverage. This notice should be posted in a common office space accessible to all employees.
Failure to comply with either of these mandates can incur fines of up to $100 per day, per incident.
When an employee is injured on the job, it creates problems both for the individual and for the company. Workers compensation creates a no-fault situation for workplace injuries and illnesses, such that by accepting the coverage, the worker is not allowed to sue the company. This eliminates the potential for legal fees and other legal liability, except in cases of willful negligence, protecting your company.
Workers are provided with payments for medical expenses related to the injury, as well as a percentage of their salary during their recovery. Vocational rehabilitation coverage may also be available to employees to help them resume working as quickly as possible. Because the employee is being paid by workers compensation, you can better afford to hire a temporary replacement if desired.
The premiums for workers compensation are determined based on a number of factors. For each employee, a risk category will be determined based on their job functions. Higher risk employees, such as construction workers, will typically cost more to insure than low-risk secretarial positions. This risk category is combined with the employee’s salary to determine your cost for that employee.
Each year, an audit must be conducted. This helps ensure that you are paying the proper premiums, allowing for refunds or balance billing if you have over- or under-paid.
If your business has employees, Massachusetts law requires that you purchase workers compensation insurance. This important coverage provides protection for both your employees and your company in case of a workplace accident.