MA Workers' Compensation Bureau Releases Rules on COVID-19 Payroll

The Massachusetts Workers' Compensation Bureau has rendered rulings for the handling of COVID-19 related payroll. The following rules apply to policies in force on or after 3/1/20.

If your business had payroll impacted, please contact our office so we can discuss amending your policy with your carrier now rather than awaiting audit at policy expiration, especially due to the 60-day notification time frame stipulated below for furloughed payments.

Sole Proprietor, Partner, LLC Member Payroll

If you are a sole proprietor, partner or LLC member that opted to be covered by your Workers Compensation policy and your business was closed as a result of the Government shutdown, your minimum/maximum payroll basis can be pro-rated for the number of weeks that your business was open.

Required Documentation

Information to substantiate the weeks your business was closed during the policy period.

Payments to Furloughed Non-Working Employees

Payments to paid furloughed employees who perform absolutely no work for you and are not present on your premises during this period must be assigned to Code 0012. This is a statistical code created to report payments to paid furloughed employees and has no rate nor premium.

Payments to paid furloughed employees are excluded only if you keep separate, accurate, and verifiable entries within your payroll records.

If separate, accurate, and verifiable entries are not maintained, payroll is assigned to the classification for work normally performed by the employee before any emergency orders, laws, or regulations issued due to COVID-19.

Who is Considered a Paid Furloughed Employee?

For MA worker’s compensation insurance purposes, any employee who continues to receive payment during a temporary layoff or an involuntary leave and is not performing any work duties for you is considered a paid furloughed employee.

Required Documentation

You are required to provide to the insurance company a list of all paid furloughed employees within 60 days of 7/10/20 (the Bureaus ruling date) to allocate payroll to Code 0012 for paid furloughed workers. This list must include the employee:

name
normal workers’ compensation classification
weekly wage
furloughed date
anticipated date of return to work or date returned

Will Furloughed Payroll be Used for Experience Rating?

Payroll to furloughed employees will not be used in the calculation of your Experience Modification or ARAP factor if above required documentation provided.

Employees Re-assigned to Work from Home

I f an employee designated to work from home duties were clerical, the employee's payroll during the pandemic period could be allocated to "Clerical" (8810) only if you have separate, accurate, and verifiable entries within your payroll records.

If these records were not maintained, then the employee's payroll is assigned to the classification for work normally performed by the employee before the stay at home order. However, if your standard Workers Compensation classification includes clerical office employees, code 8810 is not available, and employees reassigned to work from home would be included in your standard business classification.

Can an Employee's Payroll be Split between Clerical and their Regular Classification?

Single employee's payroll may be divided between "Clerical" (8810) and another classification only once during this time period. Once the employee's duties are no longer exclusively clerical, "Clerical" (8810) can not be assigned.

Required Documentation

A business is required to provide to the insurance company a list of impacted employees to re-allocate payroll to "Clerical" (8810). This list shall include the employee:

name
normal workers’ compensation classification
weekly wage
date began work at home/clerical nature
anticipated date of return to normal job or date returned

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