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How we calculate your employer claims excess

If a worker is injured in your workplace and needs time off work to recover, you may need to pay an employer excess if their workers’ compensation claim is accepted. We’re here to help you understand what the excess is, how it’s calculated and what you need to do. 

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When a worker is injured, an excess may apply 

An employer excess is similar to the excess you pay on any other insurance policy.  

If one of your workers makes a claim, you’ll need to pay an excess when:

  • they have time off work because of their injury, and
  • we accept their claim (sometimes called a ‘time loss claim’).

You’ll pay this excess directly to your worker as their first weekly compensation payment. We don’t pay the worker during this period.

We’ll tell you if you need to pay an excess

We’ll also tell you:

  • when to pay
  • how much to pay.

The excess is capped and based on weekly compensation

The amount you pay is limited.

The excess is the lower of:

What you must do as an employer

If an excess applies, you must:

  • pay the excess directly to the worker (we’ll tell you how much to pay)
  • pay within 10 business days of being notified.

If you don’t pay on time

We’ll pay your worker and recover the cost from you. A 50% penalty may also apply. 

You have other responsibilities when a worker is injured 

If one of your workers is injured at work, you also have responsibilities to support them while they recover.

Find out more

The law explains how excess works

The employer claims excess is set out in:

These laws tell us when an excess applies and how it must be calculated. They also set penalties if employers don’t pay on time.

We start by working out weekly compensation

To calculate the excess, we first need to work out the worker’s weekly compensation rate.

We do this by looking at:

  • their weekly wages
  • their capacity to work after the injury.

We’ll ask you for the worker’s wages information

This helps us calculate their weekly compensation rate.

Once we ask, you need to send the information within five business days.

You can upload it through your WorkCover Connect online account – it’s quick and easy.

Wages information can include:

  • an itemised payroll report for the 12 months before the injury, showing wages, penalties and allowances
  • payslips for the 12 months before the injury (or from their start date if they’ve worked for you for less than 12 months)
  • other written evidence if payroll records aren’t available, such as tax invoices or bank statements.

 

Weekly compensation depends on the worker’s capacity for work

How we work out weekly compensation depends on if the worker:

  • can’t work at all (total incapacity)
  • can work reduced hours (partial incapacity)
  • has a mix of both in the same week
  • has more than one employer. 

Once we know the weekly compensation, we work out the excess

In all cases, the excess is based on both the worker’s:

  • capacity for work
  • normal employment arrangements.

The excess is always the lower of:

  • the weekly compensation amount, or
  • QOTE.

Some examples of how we work out the excess 

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