Pre-injury average weekly earnings
This section applies to the calculation of PIAWE for workers injured on and after 21 October 2019. For workers injured before 21 October 2019, see 'Pre-injury weekly earnings for injuries before 21 October 2019'.
For exempt workers refer instead to ‘Weekly payments for exempt workers’
A worker may be entitled to receive weekly compensation payments. These payments are calculated by the insurer using a formula and the worker’s pre-injury average weekly earnings (PIAWE).
The weekly payment formula used depends on the worker’s capacity for work, and their entitlement period (see ‘Weekly payments’).
If a worker is entitled to weekly payments, the insurer must start payments within seven days of the initial notification of injury, unless there is a reasonable excuse not to. Therefore, PIAWE must be determined promptly to calculate the payment due.
SIRA’s Pre-Injury Average Weekly Earnings Form may be used to supply the required information.
If the insurer is unable to obtain the required information from the employer or worker, then an interim PIAWE determination is to be made.
Definition of ‘pre-injury average weekly earnings’
PIAWE is the weekly average of a worker’s gross earnings over the 52 weeks prior to their date of injury. There are some exceptions to this definition (see sections below).
To calculate a worker’s PIAWE, the insurer will determine:
- The relevant earning period, which is the period over which PIAWE will be calculated (generally 52 weeks), and
- A worker’s earnings during the relevant earning period.
As shown below, the worker’s earnings during the relevant earning period divided by the number of weeks in the relevant earning period equals the worker’s PIAWE.
More than one job
The earnings for each job that a worker was working in at the time of injury must be included in a worker’s PIAWE. However, each job may have a different relevant earning period depending on the specific circumstances of that job. The average weekly earnings from each job are added together to determine the worker’s PIAWE.
The relevant earning period
The relevant earning period is the 52-week period before the worker’s date of injury. However, the relevant earning period may be adjusted where:
- The worker started in the job less than 52 weeks prior to injury. The period prior to starting in the job is excluded from the relevant earning period.
- In the 52-week period there was an ongoing change to the worker’s job which had a financial impact (for example, a promotion, or a change from part-time to full-time). The period prior to the change is excluded from the relevant earnings period.
- The worker had taken extended periods of unpaid leave. Any period of unpaid leave of greater than 7 days (*from the first day of unpaid leave until the day before earnings start again) is to be excluded from the relevant earning period.
In some circumstances, the insurer may also align a worker’s relevant earning period to the worker’s pay period in order to simplify the calculation.
Further information on adjustments to the relevant earning period can be found in Insurer guidance GN 5.1A Calculating PIAWE.
Earnings and income
Earnings is the income received by the worker for work performed in any employment.
Income may include:
- wages, including any paid leave and loadings
- shift, overtime and other allowances paid
- commissions and piece rates.
The following amounts are not considered income for the purposes of calculating PIAWE:
- compulsory superannuation contributions made by the employer
- workers compensation or other compensation payments for loss of earnings
- the monetary value of any non-monetary benefit (while the worker continues to have access to the benefit following injury)
- any payment made without obligation by the employer (for example, bonuses and performance incentives)
Non-monetary or ‘non-cash’ benefits are earned by workers in the place of salary. They can include, for example, education fees, residential accommodation, child care or the use of a motor vehicle.
Where a worker has use of a non-monetary benefit at the time of injury, and following injury the benefit is given-up by the worker or withdrawn by the employer (for example, a company car is returned), the cash value of that benefit must be included in PIAWE.
Further information on calculating the value of non-monetary benefits can be found in Insurer guidance GN 5.1A Calculating PIAWE.
Short term workers
Workers who have been employed by the same employer for less than four weeks may have their PIAWE calculated by having regard to the weekly earnings they could have expected to earn in that employment in the 52 weeks after the injury.
PIAWE by agreement
Instead of an insurer calculating a worker’s PIAWE, a worker and employer may agree to the PIAWE amount to be used.
An application to use an agreed amount must be provided to the insurer within five days of the initial notification of injury. The application must include:
- the PIAWE amount*
- the date of the agreement
- the name, injury date and claim number for the worker
- the name of the employer
- the name and contact details of the person authorised by the employer to enter into the agreement
- details of any other employment in which the worker is engaged
- any evidence which supports the agreement (e.g. payslips or contract of employment)
- any other information the employer or worker considers were taken into account in reaching the agreement
- acknowledgement of consent to the agreement
* The agreed PIAWE remains subject to minimum PIAWE and the maximum weekly compensation amount.
A PIAWE agreement template is available on SIRA’s website.
The insurer must determine whether to approve or refuse to approve the agreement within seven days of receiving the application. To approve the agreement the insurer needs to be satisfied that:
- the agreed amount reasonably reflects the workers PIAWE, and
- the agreement is fair and reasonable.
The insurer cannot approve a PIAWE agreement for a worker who is under legal incapacity (as defined in Part 6 of the Workers Compensation Commission Rules 2011).
Note that where the insurer has yet to approve or refuse to approve an agreement, the insurer must still start payments within seven days of the initial notification of injury (unless there is a reasonable excuse not to, or liability is disputed).
Further information on PIAWE agreement can be found in Insurer guidance GN 5.1A Calculating PIAWE.
Workers under 21 years of age, apprentices and trainees
Some workers are entitled to incremental earning increases at certain ages or stages during their employment. This includes:
- workers under the age of 21
- apprentices, or
- trainees for the purposes of becoming qualified to carry on an occupation.
For these workers, PIAWE is to be recalculated following injury at each age or stage in accordance with what they would have been entitled to receive, had they not become injured and continued in that employment.
The minimum PIAWE is $155 per week. This amount is not indexed.
If a worker’s PIAWE is calculated to be lower than the minimum PIAWE ($155), then the minimum PIAWE is set as the worker’s PIAWE.