Do businesses need workers compensation insurance before hiring?

Workers Compensation Insurance Requirements in Massachusetts Before Hiring

In Massachusetts, businesses must secure workers compensation insurance before hiring employees. This requirement applies to most employers who have one or more employees, including full-time, part-time, and seasonal workers.

Key operational points:

• Obtain coverage before hiring: Massachusetts law mandates that businesses have workers compensation insurance in place prior to the first day an employee begins work.
• Coverage scope: The insurance covers medical expenses and lost wages for employees injured on the job, helping manage risk and compliance.
• Exceptions: Sole proprietors and partners without employees typically do not need this insurance, but it is crucial to verify based on your business structure.

Maintaining workers compensation insurance also supports smooth payroll processing and compliance reporting. Failure to obtain coverage before hiring can result in penalties and fines.

As of 2026, businesses should coordinate with licensed insurance carriers or the Massachusetts Workers' Compensation Rating and Inspection Bureau to secure proper coverage. Keeping records of insurance certificates is essential for audits and regulatory compliance.