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PIAWE calculation and weekly payments

PIAWE (pre-injury average weekly earnings) should be a fairly simple calculation however insurers regularly get it wrong.

The recent Workers Compensation Amendment Regulation 2018 (Amendment Regulation) has amended the Workers Compensation Act to make significant changes to the calculation of pre-injury average weekly earnings (PIAWE). PIAWE is defined as;

“The weekly average of the gross pre-injury earnings received by the worker during the period of 52 weeks before the injury in any employment in which the worker was engaged at the time of injury.”

How is it calculated?

Based on the definition of PIAWE, the insurer is required to obtain a copy of the pay slips for the 52 weeks immediately prior to the injury and calculated the average gross weekly earnings received by the worker during that period.

This should be a fairly simple calculation however insurers regularly get it wrong.

It includes the calculation of “pre-injury average weekly earnings” and includes the workers ordinary earnings as well as any overtime and/or shift allowance payment.

The insurer must make a decision in writing in relation to the PIAWE rate and notify the worker of this decision.

What if I disagree?

If you disagree with the amount calculated by the insurer, this can be challenged through the Workers Compensation Commission and you should discuss this with a lawyer.

The recent changes

The significant change that has been made by the amending regulations is that for those that are injured on or after 26 October 2018, overtime and shift allowances are no longer excluded from the calculation of the PIAWE rate after receiving 52 weeks of weekly compensation payments.

For anyone injured prior to 26 October 2018, the PIAWE is recalculated after you have received 52 weeks of weekly compensation benefits to reduce the PIAWE rate by excluding any overtime or shift allowance from the calculation.

This often resulted in a significant reduction in the weekly amount of compensation entitled to an injured worker. Often workers rely heavily on receiving overtime and shift allowance in their weekly wage.

This has been recognised by the government and changes made to the calculation of the PIAWE rate but only for people injured on or after 26 October 2018.

The 4 systems for determining the PIAWE rate

There are therefore 4 different systems for determining the PIAWE rate, depending on the date and circumstances of your injury.

  1. Coal Miners have a different method of calculating average weekly earnings.
  2. Exempt workers under the Workers Compensation Act (such as emergency workers) have a different method of calculating average weekly earnings.
  3. Those workers injured before 26 October 2018 as noted above.
  4. Those workers now injured on or after 26 October 2018 as noted above.

The government has simplified the calculation of weekly payments and made it much fairer by allowing a worker to receive essentially 80% of their pre-injury average weekly earnings including overtime and shift allowance.

If you have any questions in relation to the calculation of the PIAWE rate please do not hesitate to contact us to discuss further.

About Matthew Garling

Matthew Garling, Founder of Garling & Co is a NSW Law Society Accredited Specialist in Personal Injury Law. He specialises in compensation law and has acted on behalf of thousands of injured people in work accidents, motor vehicle accidents and negligence cases over the last 20 years.

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