Pre-accident Weekly Earnings (for accidents on or after 1 January 2005)
This policy should be read in conjunction with the Loss of Earnings Benefits policy.
For clients injured in transport accidents on or after 1 January 2005, the TAC will assess LOE benefits by calculating the client's 'pre-accident weekly earnings', using the client's average weekly gross earnings.
'Pre-accident weekly earnings' in relation to an earner (other than a self employed person) who is injured as a result of a transport accident means:
- the weekly average of the gross earnings received by the client as an earner during the 12 months immediately before the accident date; or
- if the client was earning continuously at the time of the accident but had not been earning continuously for at least 12 months, the weekly average of the gross earnings received by the client as an earner during the period from when the earner started to earn continuously to immediately before the accident date.
'Earning continuously' refers to earnings from permanent employment that was likely, at the time of the accident, to continue for a period of at least 6 months.
'Seasonal earner' is a person who engages in one or more seasonal activities.
'Seasonal activities' are activities that occur on an annual basis but that only provide employment for most of the people engaged in them for less than 6 months in any 12 month period. For example, fruit picking, skiing instructors.
How are pre-accident weekly earnings assessed where a client was continuously employed in the same position for at least 12 months prior to the date of the transport accident?
Where a client was continuously employed for the past 12 months prior to the transport accident, the TAC will assess his/her pre-accident weekly earnings based on their gross earnings for the entire 12 month period and averaging this over 52 weeks. This average amount will be affected by periods of leave without pay, industry pay rises, leave loading, bonuses paid, etc. during that 12 month period.
The client who was earning $52,000 ($1,000 gross per week) had taken eight weeks leave without pay, 9 months prior to the transport accident. As a result of that leave, her earnings during the 12 month period prior to the accident were actually $44,000, which will give her a pre-accident weekly earnings amount of $846.15, i.e. 44,000 divided by 52 weeks.
How are pre-accident weekly earnings assessed if the client was earning continuously up to the date of the accident but had not earned continuously for at least 12 months?
Where a person was earning continuously at the date of the accident, but had not earned continuously for at least 12 months, the TAC will calculate the weekly average of the gross income for that period for which he/she was earning continuously up to the date of accident.
For example, where a client is employed at the time of the accident, but had only been earning continuously for the previous 9 months, his/her weekly average gross income will be averaged over the 9 month period.
How are pre accident weekly earnings assessed if the client was unemployed at the date of accident but had been employed in various positions in the 12 months prior to the transport accident?
If a client was unemployed at the date of accident but had been employed in various positions for the 12 months prior to the transport accident, the TAC will calculate the weekly average of all the gross earnings received by the client as an earner over the 12 months immediately prior to the transport accident.
How are pre-accident weekly earnings assessed where earnings significantly increased during the 12 months before the accident?
Where, due to action taken by the client, their earnings significantly increased during the 12 months before the accident, the TAC will calculate the weekly average of the gross income for the period of the increase up to the date of accident. For example, a client that moves from part time to full time employment or where a client receives a pay increase arising from a promotion (This does not apply to pay rises applying across an industry).
How are pre-accident weekly earnings assessed where the client had more than one employer?
Where a client has more than one employer, the TAC will calculate the average weekly gross earnings of all income received from all jobs up to the statutory maximum payable. For example, if at the date of accident, the client worked full time as a nurse and worked as a casual waitress on weekends, the TAC will calculate the average weekly gross earnings of both jobs.
How are pre-accident weekly earnings assessed where the client had entered into an employment arrangement prior to the transport accident?
Where this occurs, the TAC will calculate the client's average weekly gross earnings based on what the client could reasonably have been expected to earn, but for the injury, in employment under that arrangement. All previous earnings will be disregarded.
How are pre-accident weekly earnings assessed for clients who are either under the age of 21, apprentices or employed under a contract of service?
If at the time of the accident a client is an earner and is either:
- under the age of 21 or
- an apprentice or
- employed under a contract of service and is required to undergo training , instruction or an examination in order to qualify for the occupation
and the client was entitled to increased earnings as the employment continued, the TAC will re-calculate the client's pre-accident weekly earnings in respect of any week after the accident, based on the weekly earnings that the client was likely to be entitled to in that week had the accident not occurred."
How are LOE benefits calculated for clients who are engaged in seasonal work?
A seasonal earner may elect to receive LOE benefits in one of two ways:
- firstly, the seasonal earner may elect to receive LOE benefits on the same pattern that he/she was accustomed to before the injury i.e. higher payments in the weeks in which he/she would have been working full time and no, or lower payments when he/she would normally have been unemployed or working part time or
- secondly, the seasonal earner may elect to receive the same amount each week based on a weekly average of his/her earnings in the last 12 months.
Assume Client A is involved in a transport accident on 12 January 2005. At the time of the accident the client is employed as a fruit picker and will continue to do so for the entire 3 month fruit picking season. The client will not undertake any further employment until the next fruit picking season in November 2005. During the 3 months that he will be employed, he will earn $8,000 gross ( i.e. $615 gross per week).
The client can elect to be paid either:
- According to the same pattern that he was accustomed to before the injury, i.e. on the basis of pre accident weekly earnings of $615 gross per week, until the conclusion of the 13 week fruit picking season. No further payments will be made until the start of the next fruit picking season in November 2005, if the client's injury is still preventing him from returning to work.
- At a rate of $154 per week for the duration of his period of incapacity. This amount is based on his pre accident weekly earnings averaged over 52 weeks.
In the example illustrated above, how would the client's pre accident weekly earnings be assessed if he was unemployed at the date of the accident?
The client would also have a choice as outlined above, however, if he chooses to be assessed at the pattern that he was accustomed to before the injury (i.e. option a, $615 per week), then payments would not commence until the next fruit picking season in November 2005.
When does a seasonal earner have to notify the TAC of his/her preferred method of assessment?
A seasonal earner must notify the TAC within 14 days after becoming entitled to receive a payment. If the seasonal earner fails to do so, LOE will be paid using the second option; however, this period may be altered where the TAC considers it appropriate to do so.
The method of assessment will remain in place for the remainder of the entitlement period and cannot be revoked once a payment has been made.
Can the TAC consider scholarship amounts when determining a client's eligibility for LOE benefits?
The TAC will consider a client's scholarship/stipend amounts when determining eligibility for LOE benefits and in assessing the LOE rate provided that:
- the scholarship is principally provided as work or research to benefit the scholarship provider; and
- the person is or continues to be part of an arrangement with the scholarship provider that is for their labour; and
- the person is entitled to work like conditions such as paid sick leave, annual leave and maternity leave etc as part of the scholarship.
The TAC may also consider whether the person becomes or continues to be an employee of the scholarship provider.
How are pre-accident weekly earnings benefits calculated if a client has another accident while currently receiving LOE benefits?
If a client is involved in a subsequent transport accident that aggravates their injuries or causes a new injury while they are receiving Loss of Earnings (LOE) benefits from a prior transport accident, the TAC will now continue to pay amounts calculated pursuant to the pre-accident weekly earnings before the prior transport accident.
* Previously, TAC recalculated the amount payable to a generally lesser amount based on earnings at the time of the second transport accident. The change applies to accidents on or after 6 July 2022.