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Weekly compensation payments

Weekly compensation payments are made to compensate a worker for their loss of income whilst they are injured and cannot perform all or some of their pre injury duties. A worker’s weekly compensation rate is equal to whichever is the greater of:

  • The ‘Normal Weekly Earnings’ of the worker, averaged over a period immediately before the incapacity commenced; or
  • The ‘Ordinary Time Rate of Pay’ for the hours in which the worker was engaged immediately before the incapacity commenced.

The maximum period used for calculating the normal weekly earnings is 12 months, although in circumstances where a worker has been employed for less than 12 months prior to the incapacity, the actual period of employment with their current employer is used.

Regardless of whether a new claim is accepted or in dispute, an employer must commence making payments in accordance with the usual pay cycle. Payments will be stopped if liability is not accepted at a later point in time.

Weekly compensation payments reduce over time and are payable as follows:

  • 100% of the weekly payment for the first 26 weeks of incapacity;
  • 90% of the weekly payment for the period exceeding 26 weeks but not exceeding 78 weeks of incapacity;
  • 80% of the weekly payment for the period exceeding 78 weeks of incapacity.

The following conditions also apply to the application of these reductions:

  • If a worker is not able to resume pre-injury duties but is fit for alternative suitable duties, however the employer is unable to provide alternative suitable duties, the reductions will instead be 95% after 26 weeks and 85% after 78 weeks;
  • The reductions will not apply in respect of a weekly payment if, in that week, the worker is engaging in a return to work plan and working 50% or more of their normal weekly hours.

While a worker is absent from work and receiving weekly compensation payments they are entitled to receive any salary increases they would normally have received if they had been fit and remained at work.