If you’re a South Dakota employer looking to protect both your business and your team, you’re in the right place. At Beyond, we provide the essential information you need to understand how workers’ compensation works in 2026 and how to stay compliant.
Workers’ compensation can be a strong risk-management tool for most businesses. If an employee suffers a work-related injury or occupational disease, workers’ comp can help provide medical benefits and disability (wage) benefits through a structured system.
South Dakota’s Department of Labor and Regulation (DLR) emphasizes that while coverage is not mandated statewide, it is highly recommended, and an uninsured employer may be sued in civil court by an injured worker.
DLR states: There is no law in South Dakota requiring any employer to carry workers’ compensation insurance. However, the state strongly recommends coverage because employers without it can face civil liability if a worker is injured.
Important nuance: If you do carry workers’ compensation coverage, DLR explains that the South Dakota Workers’ Compensation Law generally applies broadly, with limited exceptions for certain worker categories.
For employers who choose to carry coverage (or are approved as self-insured), the program generally pays medical and disability benefits for work-related injuries and diseases.
In practice, covered benefit categories commonly include:
• Medical treatment related to the work injury/occupational disease
• Disability benefits (income replacement), depending on eligibility and the nature of the claim
For a plain-language overview of how benefits and the process work, DLR provides an employee guide.
DLR’s “Coverage” guidance lists limited exceptions, including:
• Domestic servants (unless working more than 20 hours in any calendar week and for more than six weeks in any 13-week period)
• Farm or agricultural labor
• Independent contractors whose work is not in the usual course of the employer’s business (including certain real estate agents and owner-operators of trucks certified as independent contractors by DLR)
• Certain elected officials
• Workfare participants
Independent contractor exemption tool (official affidavit and fact sheet).
Most employers who choose coverage purchase a policy through a commercial insurer, and some employers are approved as self-insured (meaning they pay benefits directly). DLR’s employee guide notes both approaches and reiterates that coverage is not required by state law, but employers without coverage can be sued civilly.
Self-insurance (official): DLR publishes self-insurance renewal and application information. For example, DLR’s self-insurance page notes the self-insurance year runs Sept. 1–Aug. 31, and that current certificates of exemption listed there expire Aug. 31, 2026, with a stated nonrefundable application fee for renewal submissions.
(If you’re considering self-insurance, use DLR’s official forms list and application materials here.
Employee notice: DLR states that employees must provide written notice of an injury to the employer within three business days, or they risk losing workers’ compensation benefits.
Employer reporting: South Dakota’s official “Employer’s First Report of Injury” (Form 101) instructions state that the employer should submit the form to its workers’ compensation insurance carrier within seven (7) days of knowledge of the injury. Official form PDF.
Online filing option (Form 101/related reporting).
For postings related to workers’ compensation that are required by state and federal agencies, DLR directs employers to its Employment Laws posting requirements page.
Employment laws posting requirements (official hub).
(Posting requirements can vary by employer situation; relying on DLR’s official list helps avoid missing or over-claiming a requirement.)
Even though South Dakota does not require employers to carry workers’ compensation insurance statewide, DLR notes that going without coverage can expose the business to civil lawsuits if a worker is injured. Many employers choose coverage (or qualify for self-insurance) to protect employees and reduce financial uncertainty.
