Workers' Compensation


Workers’ Compensation Insurance provides coverage for the medical costs, lost wages and disability expenses for employees who are injured in a job related accident.  This coverage applies regardless of an employee’s own negligence and is considered a no-fault system of insurance coverage. 

Virtually every state requires its employers to buy workers’ compensation insurance coverage for its employees.  Should there be no Workers’ Compensation and an employee is injured, the state will levy significant fines and costs to the employer for not meeting their obligation.


In the following states of ND, OH, WA and WY, the Workers’ Compensation insurance coverage is purchased through a state agency and these states are referred to as monopolistic states.  If your employment exposure is in one of the other states, your organization has secured a national Workers’ Compensation policy of which you have access. 

Please refer to the Insurance Overview for your chapter/house corporation to determine if your location is covered by the national insurance policy.  Should you have any questions, contact your MJ Account Executive.



Monopolistic State

Workers’ Compensation Website

North Dakota






Please refer to your location-specific Insurance Overview to determine whether or not your location carries workers’ compensation coverage. If your location is in ND, OH, WA, or WY, you will need to purchase workers’ compensation coverage through your state workers’ compensation board (refer to websites in table above).


Workers' Compensation Trends


Misclassification of employees as independent contractors

The government is aggressively pursuing those employers who are misclassifying employees as a way to avoid paying payroll with-holding taxes, unemployment insurance and workers’ compensation payments.  This can save an employer as much as 30% of payroll and deprive the states of tax revenue.

There is no single “bright line” test used by state or federal agencies such as the IRS to determine whether a worker is an employee or an independent contractor.  The more common test used is the “20 Factor Test” developed by the Internal Revenue Service, where the main focus is on the degree of control exercised by an employer over a worker.

The more control exercised, the more likely the worker will be deemed to be an employee. Some questions to consider in determining if you have an employee or not include the following:


  •  If worker is hired after filling out an employment application
  • If worker is told how to perform the work and where and when to do it
  • If the employer provides the tools for the workers use


Impact of the current Economic “recession” upon independent contractors

The cost of insurance for any business is one of the larger items in their budgets.  With the economic recession, we have developed concerns that some of these businesses that our clients are hiring have chosen to eliminate their insurance coverage.  Thus, if they would happen to cause bodily injury to one of your volunteers or members or cause property damage to your chapter house, you may not have access to insurance coverage to pay for the losses from the contractor and have to rely on your own insurance.


We encourage you to secure certificates of insurance from all of your contractors who are doing work on your property.  Refer to the Insurance Summary Table of Contents for additional information on certificates of insurance.


Workers’ Compensation is a “no fault system” in which injured workers receive medical and compensation benefits no matter who causes the job-related accident. In almost every state, if you are involved in an employer/employee relationship, you are required to buy workers’ compensation coverage.