The Australian Government’s JobKeeper scheme, introduced during the COVID-19 pandemic, was designed to keep employees connected to their workplaces and support businesses facing financial hardship. While JobKeeper provided vital relief, it also created complexities within the NSW workers compensation system, requiring regulatory clarification by the State Insurance Regulatory Authority (SIRA)
JobKeeper payments impact as follows:
- The calculation of injured workers’ weekly payments of compensation
- The calculation of workers compensation premiums for employers
NSW SIRA has determined that weekly payments to injured workers count as earnings when calculating weekly compensation. JobKeeper payments received before an injury will also be treated as earnings in assessing average weekly earnings.
Key Impacts of JobKeeper on Workers Compensation
1. Weekly Compensation Payments
- Pre-Injury Average Weekly Earnings (PIAWE): Workers compensation payments are calculated based on a worker’s average weekly earnings before injury.
- JobKeeper Inclusion: SIRA determined that JobKeeper payments received before an injury are considered earnings when calculating PIAWE.
- Post-Injury Payments: Weekly compensation payments made to injured workers are also treated as earnings, ensuring consistency in how income support interacts with compensation entitlements.
NSW workers compensation premiums are based on employer-paid wages, so whether JobKeeper counts as wages affects premium calculations.
It has been determined that JobKeeper payments made to workers who performed no work during the period to which the payment relates will be excluded from the amount of wages used to calculate premium.
It has been determined that JobKeeper payments made to workers who continue to perform work (whether in their usual or a reduced or otherwise augmented capacity) will continue to be included in the amount of wages used to calculate premium.
The Workers Compensation Market Practice and Premium Guidelines have been updated and issued by SIRA are attached for your reference.
ABILITY GROUP is here to support and can assist with wages declarations for premium purposes.
Source: Sate Insurance Regulatory Authority (SIRA)
Title: 2020 Workers compensation market practice and premium guidelines
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