This Order prescribes how employers’ workers‑compensation insurance premiums for policies effective between 30 June 2012 and 30 June 2013 are calculated. It sets numeric formulas for a base tariff, experience adjustments, experience premiums, and extra contributions (dust diseases, mine safety, GST/input‑tax adjustments), plus minimums, a 3% prompt‑payment discount and record‑keeping rules for vehicle/accommodation allowances.
Employers pay the premiums; insurers calculate them using the Order’s formulas and employer returns. The Authority retains limited discretion to issue guidelines and allow reductions.
This subordinate legislative instrument fixes the rules and numeric parameters for calculating and charging workers compensation insurance premiums for policies taking effect between 4 pm on 30 June 2012 and 4 pm on 30 June 2013 (clause 2; Schedule 2, clause 1). It prescribes the formulaic structure of the employer premium (clause 3(1)) and the discrete components that feed into that premium: the basic tariff premium (T), the experience adjustment factor (S), the experience premium (E), premiums adjustment contribution (Q), dust diseases contribution (D), input tax credit adjustment (I), Mine Safety Fund premium adjustment (M), and the apprentice incentive amount (A) (clause 3(1)). The order also sets operational rules for minimum premiums, discounts for upfront payment, calculation exceptions, recordkeeping methods for motor vehicle and accommodation allowances, and other adjustments that insurers must apply when issuing or renewing policies (Schedules 3-11; Schedule 6 minimum premium; clause 4 discount).
Mechanically, the employer premium P is assembled by reference to formulae in clause 3 and the appended Schedules. The experience-adjusted element of the premium is expressed in the instrument as the experience adjusted premium formula (T × (1 − S)) + (E × S) and then combined with the other adjustments and credits to produce the premium for a period not exceeding 12 months (clause 3(1)). The order imposes ceiling limits on how large the experience-adjusted element may be relative to T for defined size bands (clause 3(2) and (3)). It distinguishes small, medium and large employers by reference to the basic tariff premium and, in some cases, wages thresholds (Schedule 1, clause 2). It also prescribes a 3 percent discount where employers pay an eligible 12-month premium in full and have provided a reasonable estimate of wages to the insurer (clause 4).
Current sections
Direct links to the current provisions in Insurance Premiums Order 2012–2013.
This Order commences at 4 pm on 30 June 2012 and must be published in the Gazette.
3
Calculation of insurance premium payable by employer
3 Calculation of insurance premium payable by employer
3 Calculation of insurance premium payable by employer
(1) The premium payable by an employer for a policy of insurance is to be calculated by requiring the premium to be calculated for a period of insurance of not more than 12 months and:
(a) if the employer is a medium or large employer for the purposes of the policy, in accordance with the following formula:
(b) if the employer is a small employer for the purposes of the policy, in accordance with the following formula:
where:
P is the premium for the time being payable by the employer in respect of the period of insurance to which the policy relates, being:
(a) except as provided by paragraph (b), the initial premium so payable in accordance with this Order, or
(b) where adjustments are required to be made to that premium by reason of the operation of this Order, the premium so payable by reason of those adjustments.
T is the basic tariff premium for the employer, calculated with respect to the period of insurance in accordance with Schedule 3.
S is the experience adjustment factor for the employer determined with respect to the period of insurance in accordance with Schedule 4.
E is the experience premium, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 5.
Q is the premiums adjustment contribution, if any, for the employer.
D is the dust diseases contribution, if any, for the employer calculated with respect to the period of insurance in accordance with Schedule 11.
I is the input tax credit adjustment, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 8.
M is the Mine Safety Fund premium adjustment, if any, for the employer calculated with respect to the period of insurance in accordance with Schedule 9.
A is the apprentice incentive amount, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 10.
(2) However, where the basic tariff premium less the apprentice incentive amount [T − A] for a policy of insurance whose total premium is to be calculated under subclause (1) (a):
(a) is less than $50,000 (or, if the period of insurance is to be less than 12 months, where the basic tariff premium less the apprentice incentive amount [T − A] would be less than $50,000 were that period of insurance to be 12 months), the experience adjusted premium [(T × (1 − S)) + (E × S)] is not to exceed one and a half times the amount of that basic tariff premium [1.5 × T], and
(b) is or exceeds $50,000 but is less than $150,000 (or, if the period of insurance is to be less than 12 months, where the basic tariff premium less the apprentice incentive amount [T − A] would be or would exceed $50,000 but would be less than $150,000 were that period of insurance to be 12 months), the experience adjusted premium [(T × (1 − S)) + (E × S)] is not to exceed twice the amount of that basic tariff premium [2 × T], and
(c) is or exceeds $150,000 but is less than $300,000 (or, if the period of insurance is to be less than 12 months, where the basic tariff premium less the apprentice incentive amount [T − A] would be or would exceed $150,000 but would be less than $300,000 were that period of insurance to be 12 months), the experience adjusted premium [(T × (1 − S)) + (E × S)] is not to exceed two and a half times the amount of that basic tariff premium [2.5 × T].
(3) However, if the employer is a member of a group:
(a) subclause (2) does not apply, and
(b) where the sum of the basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] for all the members of that group:
(i) is less than $50,000 (or, if the period of insurance is to be less than 12 months, where the sum of basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] would be less than $50,000 were that period of insurance to be 12 months), the experience adjusted premium for the employer’s policy [(T × (1 − S)) + (E × S)] is not to exceed one and a half times the amount of the employer’s basic tariff premium [1.5 × T], and
(ii) is or exceeds $50,000 but is less than $150,000 (or, if the period of insurance is to be less than 12 months, where the sum of basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] would be or would exceed $50,000 but would be less than $150,000 were that period of insurance to be 12 months), the experience adjusted premium for the employer’s policy [(T × (1 − S)) + (E × S)] is not to exceed twice the amount of the employer’s basic tariff premium [2 × T], and
(iii) is or exceeds $150,000 but is less than $300,000 (or, if the period of insurance is to be less than 12 months, where the sum of basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] would be or would exceed $150,000 but would be less than $300,000 were that period of insurance to be 12 months), the experience adjusted premium for the employer’s policy [(T × (1 − S)) + (E × S)] is not to exceed two and a half times the amount of the employer’s basic tariff premium [2.5 × T],
where:
AG is the sum of apprentice incentive amounts (if any) for all the members of the group calculated:
(a) where the period of insurance to which the premium relates is 12 months—in accordance with Schedule 10 with respect to that period of insurance, or
(b) where the period of insurance to which the premium relates is not 12 months—in accordance with Schedule 10 as if the policies to which the premiums relate had a period of insurance of 12 months.
TG is the sum of the basic tariff premiums for all the members of the group calculated:
(a) where the period of insurance to which the premium relates is 12 months—in accordance with Schedule 3 with respect to that period of insurance, or
(b) where the period of insurance to which the premium relates is not 12 months—in accordance with Schedule 3 as if the policies to which the premiums relate had a period of insurance of 12 months.
4
Discount available for premiums paid in full
4 Discount available for premiums paid in full
4 Discount available for premiums paid in full
An employer is entitled to a discount of 3 percent on the initial premium payable by the employer for a policy of insurance if:
(a) the period of insurance to which the policy relates is 12 months, and
(b) the employer has paid the discounted amount of the premium in full by the date on which payment of the premium is due, and
(c) the employer has not elected to pay the premium by instalments, and
(d) the employer has notified the insurer, in accordance with the regulations, of the reasonable estimate of the wages that will be payable during the period of insurance.
Note—
Clause 147 of the Workers Compensation Regulation 2010 requires an employer to notify the insurer concerned of the matter referred to in paragraph (d).
5
Recovery of excess from employer: section 160 of Act
5 Recovery of excess from employer: section 160 of Act
5 Recovery of excess from employer: section 160 of Act
For the purposes of the definition of prescribed excess amount in section 160 (1) of the Act, the following excess amount is specified:
(a) if the employer concerned notified the relevant insurance scheme agent of the injury that led to the weekly compensation claim of the worker within 5 days of the employer becoming aware of it—$0,
(b) in all other cases—the lesser of the following:
(i) the amount that is the weekly payment of compensation to which the worker is entitled as determined by section 36 of the Act,
(ii) $1,838.70.
Note—
Under section 160 (2) of the Act, an employer is required to repay the prescribed excess amount to the insurer under a policy of insurance in respect of each weekly compensation claim that the insurer has paid under the policy. However, if the amount that the insurer has paid in respect of any such claim is less than the prescribed excess amount, the amount the employer must repay is that lesser paid amount.
cl 5: Am 2012 (683), cl 3.
6
Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
6 Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
6 Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
For the purposes of sections 170 (8) and 172 (5) of the Act, the prescribed rate is 0.977% per month compounded monthly.
7
Calculation of costs of individual claims and provisional payments of compensation: clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of Regulation
7 Calculation of costs of individual claims and provisional payments of compensation: clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of Regulation
7 Calculation of costs of individual claims and provisional payments of compensation: clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of Regulation
For the purposes of clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of the Workers Compensation Regulation 2010, the amount specified is $1,838.70.
8
Exemption limit for certain employers: section 155AA (8) of Act
8 Exemption limit for certain employers: section 155AA (8) of Act
8 Exemption limit for certain employers: section 155AA (8) of Act
The exemption limit (within the meaning of section 155AA (8) of the Act) for an employer who carries on a business that is covered by Table A’s classes 612310, 612315, 612320, 612322, 612324, 612326, 612330, 931120, 931130, 931920, 931930, 931940 or 931950 (being classes that refer to a per capita rate), regardless of whether the employer carries on any other business, for the 2012–2013 financial year is fixed at $0.
Note—
The effect of fixing the exemption limit for the specified employers at $0 is that those employers will not be “exempt employers” within the meaning of section 155AA (Exempt employers not required to obtain policy of insurance) of the Act.
9
Schedules form part of Order
9 Schedules form part of Order
9 Schedules form part of Order
Schedules 1–13 form part of this Order.
Schedule 1
Interpretation
Schedule 1 Interpretation
Schedule 1 Interpretation
(Clause 9)
10
Meaning of “predecessor”
10 Meaning of “predecessor”
10 Meaning of “predecessor”
(1) For the purposes of this Order, a person is the predecessor of an employer if:
(a) Acquisition or otherwise gaining possession of predecessor’s business
the employer has acquired or otherwise come into the possession of the business of the person, or
(b) Transfer of all or majority of predecessor’s workforce
the employer has, during any policy period, employed workers who at any time constituted all or a majority of the workers employed, during any policy period, by the person and those workers have carried out activities or performed services for the employer that were the same or similar to activities carried out or services performed by those workers for the person.
Note—
The claims and wages history of an employer’s predecessor are used in the calculation of the employer’s workers compensation insurance premium—see Schedule 4, clause 4 and Schedule 5, clause 1 (3) of this Order.
(2) Subclause (1) (a) applies whether the business acquired is the whole or main part of the business of the person or is the whole or main part of a separate and distinct business of the person, and whether or not the business acquired is carried on at the same location.
(3) Subclause (1) (b) applies whether or not the activities carried out or services performed for the employer were carried out or performed at the same location as those carried out or performed for the person.
(4) In this clause, business has the same meaning as in Division 2B of Part 7 of the Act.
Schedule 2
Application
Schedule 2 Application
Schedule 2 Application
(Clause 9)
Schedule 3
Basic tariff premium
Schedule 3 Basic tariff premium
Schedule 3 Basic tariff premium
(Clause 3)
Schedule 4
Experience adjustment factor
Schedule 4 Experience adjustment factor
Schedule 4 Experience adjustment factor
(Clause 3)
Schedule 5
Experience premium
Schedule 5 Experience premium
Schedule 5 Experience premium
(Clause 3)
Schedule 6
Minimum premium
Schedule 6 Minimum premium
Schedule 6 Minimum premium
(Clause 9)
Schedule 7
Reduction of premium for employers of previously injured workers etc
Schedule 7 Reduction of premium for employers of previously injured workers etc
Schedule 7 Reduction of premium for employers of previously injured workers etc
(Clause 9)
Schedule 8
Input tax credit adjustment
Schedule 8 Input tax credit adjustment
Schedule 8 Input tax credit adjustment
(Clause 3)
Schedule 9
Mine Safety Fund premium adjustment
Schedule 9 Mine Safety Fund premium adjustment
Schedule 9 Mine Safety Fund premium adjustment
(Clause 3)
Schedule 10
Apprentice incentive scheme
Schedule 10 Apprentice incentive scheme
Schedule 10 Apprentice incentive scheme
(Clause 3)
Schedule 11
Dust diseases contribution
Schedule 11 Dust diseases contribution
Schedule 11 Dust diseases contribution
(Clause 3)
Source text: opening excerpt
Sourced from legislation.nsw.gov.au, CC BY 4.0.
1 Name of Order
1 Name of Order
1 Name of Order
This Order is the Insurance Premiums Order 2012–2013.
2 Commencement
2 Commencement
2 Commencement
This Order commences at 4 pm on 30 June 2012 and must be published in the Gazette.
3 Calculation of insurance premium payable by employer
3 Calculation of insurance premium payable by employer
3 Calculation of insurance premium payable by employer
(1) The premium payable by an employer for a policy of insurance is to be calculated by requiring the premium to be calculated for a period of insurance of not more than 12 months and:
(a) if the employer is a medium or large employer for the purposes of the policy, in accordance with the following formula:
(b) if the employer is a small employer for the purposes of the policy, in accordance with the following formula:
where:
P is the premium for the time being payable by the employer in respect of the period of insurance to which the policy relates, being:
(a) except as provided by paragraph (b), the initial premium so payable in accordance with this Order, or
(b) where adjustments are required to be made to that premium by reason of the operation of this Order, the premium so payable by reason of those adjustments.
T is the basic tariff premium for the employer, calculated with respect to the period of insurance in accordance with Schedule 3.
S is the experience adjustment factor for the employer determined with respect to the period of insurance in accordance with Schedule 4.
E is the experience premium, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 5.
Q is the premiums adjustment contribution, if any, for the employer.
D is the dust diseases contribution, if any, for the employer calculated with respect to the period of insurance in accordance with Schedule 11.
I is the input tax credit adjustment, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 8.
The instrument specifies further numeric parameters employers and insurers must use: a minimum premium of $175 (Schedule 6, clause 1), a prescribed late payment rate of 0.977 percent per month compounded monthly for payment default purposes under ss 170(8) and 172(5) of the Act (clause 6), prescribed prescribed excess amounts for the purposes of s 160(1) of the Act (clause 5), and a specified dollar amount used in particular claim cost calculations ($1,838.70) (clause 7). It sets out detailed recordkeeping and calculation methods for motor vehicle allowances (Schedules 1 cl 3-7), provides an apprentice incentive calculation (Schedule 10), an input tax credit adjustment table (Schedule 8), Mine Safety Fund adjustment (Schedule 9) and dust diseases contributions (Schedule 11). Schedules 1-13 form part of the Order (clause 9).
All definitions and cross-references used throughout the Order are contained in Schedule 1 (clause 9). The instrument cross-references the Workers Compensation Act 1987, the Workers Compensation Regulation 2010 (clauses 4 and references in multiple schedules), the A New Tax System (Goods and Services Tax) Act 1999, the Apprenticeship and Traineeship Act 2001 and the Workers’ Compensation (Dust Diseases) Act 1942. Where the Order leaves discretion, it delegates guideline and implementation functions to the Authority or provides for Ministerial or Governor notification in the Gazette (see Sch 4 cl 5, Sch 5 cl 1(b), various Gazette/editorial notes).
Main concepts
The Order is formula-driven and modular. Its core concepts and building blocks are:
Basic tariff premium (T). T is the baseline premium calculated by multiplying wage (or per capita) bases by industry class rates specified in Table A (Schedule 3, clause 1). Classification of the employer’s business is done by reference to Table B (Schedule 1, clause 1; Schedule 1, clause 8).
Experience adjustment factor (S). S is a calculated factor that reflects an employer’s recent claims history, expressed through a formula that uses Employer Claim Cost Rates and industry claims cost rates, and scaled depending on whether the employer is new, previously self-insured or part of a group (Schedule 4, clause 1). It may be reduced by application to the Authority where there have been breaks in insurance (Schedule 4, clause 5).
Experience premium (E). E adjusts the premium to reflect actual employer claim costs and industry benchmarks. E is calculated differently depending on whether it is an initial calculation (before the expiry of the insurance period) or a hindsight calculation (after the period has expired), with separate formulae for policies of different lengths and for employers moving to Comcare (Schedule 5, clause 1).
Experience-adjusted premium. The instrument combines T, S and E in the expression (T × (1 − S)) + (E × S) to produce the experience-adjusted component used in the overall premium (clause 3(1); various Schedules).
Caps on experience adjustments. The Order sets caps on the experience-adjusted premium relative to T: for specified ranges of T − A (basic tariff less apprentice incentive), the experience-adjusted premium cannot exceed 1.5 × T, 2 × T or 2.5 × T respectively; the group context has its own aggregation to determine which cap applies (clause 3(2)-(3); Sch 8 also mirrors these caps in determining I).
Apprentice incentive amount (A). A reduces the basic tariff premium to reflect wages paid to apprentices and is calculated analogously to T using the same Table A rates but applied to apprentices’ wages (Schedule 10).
Input tax credit adjustment (I). The Order adjusts premiums to reflect an employer’s input tax credit entitlement, using the employer’s notified ITC entitlement to select a percentage discount B% from a table, and computing I accordingly (Schedule 8).
Other contributions and adjustments. Dust diseases contribution (D) (Schedule 11), Mine Safety Fund adjustment (M) (Schedule 9), premiums adjustment contribution (Q) (defined in Schedule 1), and the minimum premium floor (Schedule 6) are discrete add-ons or constraints.
Recordkeeping methods for allowances. The Order sets two alternative methods to calculate the motor vehicle allowance exclusion from wages,the continuous recording method (Schedule 1, clause 4) and the averaging method (Schedule 1, clause 5),and prescribes particular data employers must keep under each method. Accommodation allowances excluded to fixed per-night amounts are set out (Schedule 1, clause 3).
Interaction with returns and regulation. Many calculations rely on returns furnished "in accordance with the regulations" (for example, Schedule 3 clause 1(2); Schedule 5 clause 1(2)). The Order makes specific default provisions where employers do not supply required returns (for example, input tax credit entitlement defaults to 100 percent if not notified to the insurer, Schedule 8 clause 2(2); W1 fallback in Schedule 5 clause 1(2)). The Authority (undefined here but referenced) has power to issue guidelines and develop criteria for reductions and other administrative matters (Schedule 7 clause 4; Schedule 4 clause 5).
These concepts are implemented by numerical parameters that the Order specifies directly: discount 3 percent for full 12-month payment (clause 4); minimum premium $175 (Schedule 6); prescribed excess amounts for s 160 employers (clause 5); late payment rate 0.977 percent per month compounded monthly (clause 6); and a set dollar figure ($1,838.70) used in clause 7 and the s 160 cap (clause 5 and clause 7).
Who it affects
Primary financial burden
Employers. Employers are the payers of the premium P. The Order defines who counts as an employer and sets out how their premium is calculated and adjusted (Schedule 1, clause 1: "employer includes a person who proposes to become an employer"; clause 3). Employers pay the bundled premium composed of the basic tariff, experience adjustments, contributions and statutory levies (clause 3(1); Schedules 3-11). Employers that fail to supply required returns or notices face specific defaults: input tax credit entitlement defaults to 100 percent if not notified (Schedule 8 clause 2(2)); wages for premium calculation are estimated upward by multiplication by 1.3 if returns are missing (Schedule 1 clause 9(2)); apprentice incentive A is taken to be zero if the wage notice required by clause 147 of the Workers Compensation Regulation 2010 is not supplied (Schedule 10 clause 2(2)).
Small, medium and large employers. The Order differentiates treatment by size. Size is primarily defined by the basic tariff premium (Schedule 1 clause 2) and, for small employers, by wages thresholds. The caps on experience-adjusted premiums and certain formulaic substitutions depend on whether an employer is small, medium or large (clause 3(1)(a)-(b); clause 3(2)-(3); Schedule 8 mirrors the caps in I calculation).
Secondary affected parties
Insurers. Licensed insurers are required to apply the Order’s formulas when calculating premiums, apply discounts where conditions are met, and implement the recordkeeping and notification consequences described. The Order requires insurers to use employer-supplied returns and allows insurers to substitute prior calculation figures where current returns are missing (Schedule 5 clause 1(2); Schedule 3 clause 1(2)).
Groups of employers. Employers who are members of a group see their tariffs and experience adjustments aggregated for some limits and for the computation of S and certain caps (clause 3(3); Schedule 4 clause 2; Schedule 8 clause 3). The Order includes special treatment when a member departs or ceases operating to reallocate claims costs and wages between continuing and departing members (Schedule 5 clause 3).
Employees. Employees are affected indirectly. The order determines whether certain items form part of wages for premium calculation - e.g. motor vehicle and accommodation allowances can be excluded to specified extents subject to employer recordkeeping (Schedule 1 clause 3). The Order also fixes the employer’s liability to repay an excess amount to the insurer (clause 5), which may influence employer behaviour on injury notification and claims management.
The Authority and Governor. The Authority is allocated administrative functions under the Order: issuing guidelines, developing criteria for reductions in S, allowing delayed recording of vehicle nominations and potentially recommending different Industry Claims Cost Rates to the Governor (Schedule 4 clause 5; Schedule 5 clause 1(1)(b)). The Governor, on recommendation from the Authority, may determine different industry claims cost rates for particular classes and publish them in the Gazette (Schedule 5 clause 1).
Administrative and compliance actors
Accountants, payroll departments and compliance officers. The Order creates recordkeeping obligations and optional choices (e.g. which motor vehicle allowance calculation method to adopt) that require payroll and accounting systems to capture odometer readings, classification returns, apprenticeship wages, GST input tax credit entitlements and wage estimates in accordance with the Regulations and the Order (Schedule 1 clauses 3-7; Schedule 8 clause 2; clause 4).
Employers who are or were self-insurers or Comcare employers. There are tailored rules when employers were previously self-insurers (Schedule 4 clause 3) and where an employer has become a Comcare employer for the purposes of experience premium calculation (Schedule 5 clause 1(1)(c)(i)).
Who decides
Employers decide which motor vehicle allowance method to adopt and whether to pay premiums in full or by instalments (Schedule 1 cl 3(3), cl 4, clause 4). Employers also decide whether to apply for experience adjustment reductions from the Authority where breaks in insurance exist (Schedule 4 clause 5).
Insurers decide classification when employers do not supply sufficient information; they allocate the business to the highest rate class that appears applicable and may reclassify when sufficient information is later supplied (Schedule 3 clause 2; repeated in Schedules 10 and 11).
The Authority and Governor exercise discretion on guidelines and industry rates, respectively (Schedule 4 clause 5; Schedule 5 clause 1(1)(b)).
Key duties and rights
Duties imposed on employers
Payment duty. Employers must pay the premium calculated in accordance with clause 3 and the Schedules. The premium must be calculated for a period of not more than 12 months (clause 3(1)).
Notification and return duties. Employers must supply returns "in accordance with the regulations" to enable accurate tariff calculation and experience rating (Schedule 3 clause 1(2); Schedule 5 clause 1(2); Schedule 8 clause 2(1) referencing clause 151 of the Workers Compensation Regulation 2010). Failure to notify triggers specified defaults: input tax credit entitlement taken as 100 percent if not notified (Schedule 8 clause 2(2)); apprentice incentive A is taken to be zero where a required notice as to wages has not been supplied (Schedule 10 clause 2(2)); W1 fallback in Schedule 5 clause 1(2).
Recordkeeping for allowances. Employers who seek to exclude motor vehicle or accommodation allowances from wages must keep the prescribed details. Under the continuous recording method, employers must keep odometer readings for each business journey and purpose for each journey (Schedule 1 clause 4). Under the averaging method, employers must record a specified set of odometer readings and proportions for a 12-week relevant period and follow the renewal rules for that averaging to endure for up to four subsequent periods unless varied (Schedule 1 clause 5).
Injury notification. For purposes of s 160 of the Act, to avoid payment of a prescribed excess amount an employer must notify the relevant insurance scheme agent of the injury that led to a weekly compensation claim within 5 days of becoming aware of it; clause 5 specifies that the prescribed excess is $0 in that event, otherwise the prescribed excess is the lesser of the weekly payment amount or $1,838.70 (clause 5).
Application rights. Employers may apply to the Authority for reductions of S where breaks in insurance have occurred; the Authority may develop criteria and calculate reductions (Schedule 4 clause 5).
Rights of employers
Discount right. Employers are entitled to a 3 percent discount on the initial premium for a 12-month policy if they pay the discounted amount in full by the due date, do not elect instalments, and notify the insurer of a reasonable wage estimate in accordance with the regulations (clause 4).
Choice of allowances method. Employers may choose between the continuous recording method or the averaging calculation method for motor vehicle allowance exclusions (Schedule 1 clause 3(3)). The averaging method includes transitional and renewal rules and a procedure for nominating replacement vehicles (Schedules 1 clauses 5-7).
Reclassification and recalculation rights. Where insufficient classification information is initially supplied, the employer may later supply sufficient details and be reclassified to a lower rate (Schedule 3 clause 2; Schedule 10 clause 2(1); Schedule 11 clause 2).
Duties and discretions of insurers and the Authority
Insurer duty to apply formulas and defaults. Insurers must calculate T, S, E, and other elements in accordance with the Schedules and apply default calculations where employers fail to supply required information (Schedule 5 clause 1(2); Schedule 3 clause 1(2)).
Insurer discretion on reclassification. Insurers may reclassify business on receipt of sufficient information (Schedule 3 clause 2).
Authority’s guideline-making. The Authority may issue guidelines on the application process for premium reductions relating to hiring of previously injured workers (Schedule 7 clause 4), may develop criteria for reduction of S when breaks in insurance exist (Schedule 4 clause 5), and may issue other administrative guidelines as contemplated in the Order.
Statutory interactions and constraints
Caps on experience adjustment. The order enforces statutory caps on how far experience-adjusted premiums may depart from the basic tariff depending on T − A range, with special aggregated assessments for employer groups (clause 3(2)-(3); Schedule 8 clause 1(b)-(d) and Schedule 8 clause 3).
Minimum premium constraint. Regardless of the formula outcome, the minimum premium payable is $175 (Schedule 6 clause 1-3), and discounted amounts cannot reduce the premium below that floor (Schedule 6 clause 3).
Procedural constraints. Certain elements require publication or notification in the Gazette: Table A and Table B are specified to be seen in the Gazette (Schedule 1 editorial notes); ICCR2 may be varied by Governor via Gazette notice on Authority recommendation (Schedule 5 clause 1(1)(b)).
Penalties and enforcement
Sources of enforcement power in the Order
References to the Act. The Order operates as subordinate instrument under the Workers Compensation Act 1987, and many of its enforcement effects are tied to the Act’s enforcement provisions (the Order itself cites s 160, s 170(8), s 172(5) of the Act in clauses 5 and 6). The Order prescribes particular amounts and rates to be applied under those Act provisions (clause 5 prescribes the "prescribed excess amount" for s 160(1); clause 6 prescribes the late payment rate for ss 170(8) and 172(5)).
Monetary and administrative penalties implicit in calculation rules. The Order creates financial consequences for non-compliance with return and notification obligations through default calculation rules and monetary adjustments:
If an employer fails to notify the insurer of input tax credit entitlement, the entitlement is taken to be 100 percent for the period and that affects I (Schedule 8 clause 2(2)).
If employers fail to provide wage returns, insurers may estimate wages for prior periods by multiplying the previous period by 1.3 (Schedule 1 clause 9(2)).
Apprentice incentive A may be set to zero if wage notice not supplied (Schedule 10 clause 2(2)).
Insurers are authorised to assign the highest applicable classification rate where employers do not provide sufficient classification information (Schedule 3 clause 2; similar clauses in Schedules 10 and 11).
Late payment interest. Clause 6 prescribes the interest rate for late payments of amounts required under ss 170(8) and 172(5) of the Act as 0.977 percent per month compounded monthly. The Order thus fixes a statutory rate for use where the Act authorises an interest charge for overdue amounts.
Specified monetary limits and calculations used by enforcing actors
Prescribed excess. For s 160 of the Act, the Order specifies that the prescribed excess is $0 where an employer notified the insurer of the injury within five days; otherwise the prescribed excess is the lesser of the weekly compensation payment amount determined under s 36 of the Act or $1,838.70 (clause 5).
Fixed dollar figures used in claim cost and provisional payment calculations. Clause 7 prescribes $1,838.70 for the purposes of particular claim-cost calculations in the Workers Compensation Regulation 2010 clauses 154(2)(d)(ii)(C) and 155(2)(d)(ii)(C).
Limitations on the Order’s enforcement detail
The Order itself does not set out criminal offences, administrative penalty amounts (other than the financial mechanics above), or procedural tribunal mechanisms. Those enforcement mechanisms, where applicable, derive from the Act and related regulations. Practitioners must therefore consult the Workers Compensation Act 1987 and relevant regulations for procedural and penalty frameworks that sit above or interact with the instrument’s numeric and formulaic prescriptions.
Discretionary levers that affect enforcement outcomes
Authority guidelines and reductions. The Authority may develop eligibility criteria and calculation methods for reducing S where breaks in insurance exist and issue guidelines for premium reduction applications under Schedule 7. Those administrative instruments will affect the practical enforcement and relief landscape, but the Order leaves the substance of those criteria to the Authority (Schedule 4 clause 5; Schedule 7 clause 4).
Insurer assessment and reclassification. Insurers are empowered to classify employers where insufficient information is supplied and to recalculate premiums when employers later supply information. This operational discretion affects enforcement by creating de facto penalties (higher initial classification or premium) for information gaps (Schedule 3 clause 2; Schedule 10 clause 2(1)).
How it interacts with other laws
Direct cross-references in the Order
Workers Compensation Act 1987. The Order is subordinate to the Act and repeatedly references sections of the Act: clause 3 is explicitly “for the purposes of” calculating premiums under the Act; clause 5 references s 160(1) about prescribed excess amounts; clause 6 references ss 170(8) and 172(5) of the Act for late payment rates. The Order’s definitions also expressly define "the Act" as the Workers Compensation Act 1987 (Schedule 1 clause 1).
Workers Compensation Regulation 2010. The Order repeatedly cross-references clauses of the Workers Compensation Regulation 2010: clause 4 refers to clause 147 requiring employer notification of wages; Schedule 5 clause 1(2) and Schedule 8 clause 2 point to clause 151 of that Regulation for input tax credit notifications. The Order uses the text "in accordance with the regulations" when referring to returns and notices employers must furnish. The instrument includes editorial notes with links to that Regulation (Schedules 1 and elsewhere).
A New Tax System (Goods and Services Tax) Act 1999 (Commonwealth). GST and input tax credit concepts are referenced; Schedule 1 defines GST "has the same meaning as in" the GST Act and Schedule 8 relies on the employer's ITC entitlement as defined by that Act.
Apprenticeship and Traineeship Act 2001. "Apprentice" and "apprenticeship contract" are defined by reference to that Act for the apprentice incentive calculation (Schedule 1 clause 1; Schedule 10 clause 1(3)).
Workers’ Compensation (Dust Diseases) Act 1942. Schedule 11 makes special provision for employers engaged in certain dust-disease risk classes, including reference to a 1979 determination by the Dust Diseases Board published in the Gazette.
Operational interaction effects
Regulation-dependent inputs. The calculations for T, S, E and various adjustments depend on employer-supplied returns "in accordance with the regulations" and on insurer access to those returns. The Order therefore presupposes the operation of the relevant regulation regime (Workers Compensation Regulation 2010), and defaults or substitutions in the Order apply where those regulatory returns are missing.
GST interaction. The Order adjusts premiums for input tax credit entitlements using a specified percentage table (Schedule 8). Employers who claim partial input tax credits under the GST Act will see their premiums adjusted via the I element. Failure to notify ITC entitlement to the insurer under the referenced regulatory clause leads to the default entitlement of 100 percent (Schedule 8 clause 2(2)).
Group aggregation and corporate law concepts. The notion of a "group" and "predecessor" for experience-rating purposes uses business acquisition and workforce transfer concepts; Schedule 1 clause 10 defines "predecessor" in practical terms, and Schedule 4 clause 2 and Schedule 5 clause 3 have rules for groups and departing members. The Order references Division 2B of Part 7 of the Act in defining "business" for predecessor purposes, creating a link back to statutory definitions in the Act.
Comcare and federal licensing. Schedule 5 clause 1 provides a specific formula for calculating E where an employer has become a Comcare employer and thus left the NSW scheme, referencing the Safety, Rehabilitation and Compensation Act 1988 (Commonwealth).
Gazette publication. Table A and Table B are scheduled and their texts are to be found in Gazette No 66 of 27 June 2012 and Gazette No 66 p 2633 respectively (Schedule 1 editorial notes). The Order also contemplates Governor-notified ICCR2 rates on Authority recommendation and Gazette publication (Schedule 5 clause 1(1)(b)).
Limits of the interaction description in the instrument
The Order prescribes numeric values and calculation rules and points to other Acts and Regulations for definitions and procedures. It does not restate the procedural enforcement framework of the Act or detailed GST law; practitioners must read the relevant sections of the Workers Compensation Act 1987, the Workers Compensation Regulation 2010 and the GST Act to understand procedural rights, dispute mechanisms, and tax law consequences.
Amendment history
Commencement and editorial notes
The Order commences at 4 pm on 30 June 2012 and must be published in the Gazette (clause 2). The Order includes editorial notes referencing Gazette No 66 of 27 June 2012 for the text of Schedule 12 (Table A) and Schedule 13 (Table B), and an erratum reference in Gazette No 72 of 13 July 2012 (Schedule 1 editorial notes).
Recorded amendments in the text
Clause 5 contains an internal amendment note: "cl 5: Am 2012 (683), cl 3." This indicates that clause 5 was amended in 2012 by instrument 683, clause 3. No other specific amendment entries appear in the text supplied.
Schedules status
The Order explicitly states that Schedules 1-13 form part of the Order (clause 9). The text provided contains Schedules 1-11 and references Schedules 12 and 13 (Table A and Table B) which the editorial notes place in the Gazette.
Implications for practitioners
The Order’s numeric parameters and formulas are fixed for the 2012-2013 policy year as specified, and any modification to industry claims cost rates or Table A/B rates requires the Governor/Authority process described in the Order (Schedule 5 clause 1(1)(b) and Schedule 1 editorial notes). Changes to the Order thereafter would be effected by fresh Insurance Premiums Orders or amendments published in the Gazette; this instrument includes a temporal qualification in Schedule 2 clause 1 that makes it applicable for policies to take effect on or after the commencement date and before 4 pm on 30 June 2013, and provides a temporary extension mechanism if a new order has not been made by that latter date (Schedule 2 clause 1(2)).
The single explicit amendment note in clause 5 should be traced to the amending instrument referenced (2012 (683), cl 3) for the details of the alteration. No other amendment history is set out in the instrument text provided.
Litigation history
Documented litigation
The instrument contains no case names, judicial decisions, or explicit references to litigation. It does not itself record any challenges, judicial review matters, or tribunal decisions.
What the absence here means for research
The Order is a technical price-setting instrument with numerous formulae and operational rules. Where litigation does arise, it is likely to concern classification disputes, reclassification, insurer determinations of wages, application of caps and experience rating calculations, disputes about whether an employer is part of a group or a predecessor relationship, or alleged failures in insurers’ application of the formulae. However, none of those cases are named in the text. Practitioners must therefore search external databases, tribunal records and court reports for any cases referring to the Insurance Premiums Order 2012-2013, the Workers Compensation Act 1987 clauses cited, or disputes over particular Schedules.
Practical research steps
To assemble a litigation history, consult NSW Administrative Decisions Tribunal (or its successor tribunals), NSW Civil and Administrative Tribunal, the NSW Supreme Court, and relevant workers compensation arbitration decisions for the 2012-2013 period. Cross-check for decisions that refer to key contested provisions in the Order such as Schedule 4 (experience adjustment S), Schedule 5 (experience premium E), classification disputes under Schedule 3, or the prescribed excess amounts under clause 5.
Check Gazette notices and Authority publications for any administrative appeals or reviews referenced in decisions. The Order’s editorial notes point to Gazette No 66 (27 June 2012) and No 72 (13 July 2012) for Table A and Table B, check those Gazettes for any explanatory statements or amendments the Governor or Authority published that might have been the subject of legal dispute.
Limitations
Because the instrument itself does not list litigation, this section records only that no litigation is documented in the instrument and sets out where to look externally for cases. The Order’s operation intersects many facts that commonly give rise to dispute; absence of reported litigation in the instrument is not evidence that no disputes occurred.
Gotchas
Default assumptions and their financial effects
Input tax credit default. If an employer fails to notify its input tax credit entitlement in accordance with clause 151 of the Workers Compensation Regulation 2010, Schedule 8 clause 2(2) treats the employer’s ITC entitlement as 100 percent. Given the sliding B% adjustment table in Schedule 8 clause 1, this default removes any ITC-based premium discount and can increase the premium relative to a correctly notified partial ITC. Employers must ensure timely notification of ITC entitlements to avoid an unfavourable default.
Wage-return default multiplier. If an employer fails to furnish returns for a relevant period, Schedule 1 clause 9(2) substitutes an estimate equal to 1.3 times the prior equivalent period. That 30 percent increase is applied to wages for premium calculation and can materially increase T and the experience premium base. Insurers are authorised to use that fallback.
Recordkeeping traps
Motor vehicle allowance methods. Employers may elect continuous recording or averaging for excluding motor vehicle allowances (Schedule 1 clause 3(3)). Each method has precise data requirements. Under the averaging method, an initial 12-week record is used to set percentages that apply for up to four subsequent policy periods, with fresh recording required in the next succeeding period after four consecutive periods (Schedule 1 clause 5). Employers who do not keep the required odometer or purpose details will not be able to rely on the exclusion and may face higher assessed wages. The Authority can, however, direct employers to keep records for additional periods (Schedule 1 clause 5(3)(a)).
Classification assigned to highest rate class. If an employer does not supply sufficient information to allow classification, Schedules 3, 10 and 11 repeatedly require that the business be classified in the class with the highest percentage rate that appears applicable. Employers who postpone supplying classification information risk a higher tariff until reclassification is accepted.
Group aggregation and cap calculations
Caps apply on group aggregated bases. For employers who are group members the caps on experience-adjusted premiums and the substitution limits in Schedule 8 depend on the sum of TG − AG (sum of basic tariffs less sum of apprentice incentives) across the group (clause 3(3); Schedule 8 clause 3). A member’s premium cap may therefore be driven by the group’s aggregated tariffs, not the member’s standalone tariff. Employers in groups should understand the group aggregation rules and be wary of strategic grouping or de-grouping implications.
Departing member calculations are complex. Schedule 5 clause 3 prescribes a multi-stage reallocation of C0, C1, C2 and W0-W2 when a group member departs during calculation periods. Practitioners should not attempt ad hoc reallocations; follow the schedule’s formulae strictly.
Apprentice incentive and wage notices
Apprentice incentive A can be zeroed by a missing wage notice. Schedule 10 clause 2(2) takes A to be zero where the employer has not supplied the wage notice required by clause 147 of the Workers Compensation Regulation 2010. Employers who rely on the apprentice incentive as a premium reduction must ensure compliance with the regulation’s notice provisions.
Experience factor reduction is discretionary
The Authority controls reductions of S. Schedule 4 clause 5 permits the Authority to reduce S (including to nil) on application where breaks in insurance exist, but the Order leaves eligibility criteria, calculation methods and other matters to Authority-developed criteria and guidelines. Employers should not assume an automatic reduction; they must apply and meet the Authority’s forthcoming criteria.
Minimum premium and discount interactions
Minimum premium floors interaction with discount. The minimum premium is $175 (Schedule 6 clause 1-3) and the 3 percent discount under clause 4 applies to the initial premium but cannot reduce a premium below the minimum floor per Schedule 6 clause 3. Employers should calculate whether paying in full yields a net benefit once the minimum premium floor is considered.
Excess recovery and notification window
Tight 5-day notification window for $0 excess. Clause 5 makes the prescribed excess $0 where the employer notifies the relevant insurance scheme agent of the injury within five days of becoming aware of it; outside that window the prescribed excess is the lesser of the weekly compensation payment amount or $1,838.70. Employers must implement prompt injury notification processes if they wish to avoid the potential excess repayment obligation.
Late payment cost
Compound monthly rate. Clause 6 prescribes a late payment rate of 0.977 percent per month compounded monthly. This is effectively a compounding penalty and can accumulate quickly over successive months. Ensure systems prevent overdue premium payments.
Regulation dependence
Reliance on external regulations and Gazette publications. Many obligations and inputs are via references to “the regulations” and Table A/B published in the Gazette. Practitioners must ensure they consult the underlying Table A and Table B texts and the relevant clauses in the Workers Compensation Regulation 2010 (e.g. clauses 147 and 151) for operative detail and the exact rates. The Order’s editorial notes point to Gazette No 66 of 27 June 2012 (and note an erratum in Gazette No 72 of 13 July 2012) but do not reproduce Table A/B in full in the text supplied.
How to comply
Immediate procedural checklist for employers and advisers
Identify policy period and applicability
Confirm the policy takes effect between 4 pm 30 June 2012 and 4 pm 30 June 2013 or falls within the Order’s temporary extension provision (clause 2; Schedule 2 clause 1). If outside those dates, consult the subsequent Insurance Premiums Order.
Classify the business and assemble wage data
Determine the employer’s applicable class or classes from Table B (Schedule 1 clause 8) and the corresponding percentage rates in Table A for the basic tariff T (Schedule 3 clause 1). Where multiple classes apply, allocate parts of total wages to each class as per Schedule 3 clause 1(2). If insufficient information exists, expect the insurer to classify at the highest apparent rate and reapply for reclassification when full information is available (Schedule 3 clause 2).
Furnish returns and notices
Supply wage returns and input tax credit entitlement notifications to the insurer "in accordance with the regulations" (Schedule 3 clause 1(2); Schedule 8 clause 2(1) referencing clause 151 of the Workers Compensation Regulation 2010). Missing wage returns trigger a fallback that inflates wages by 30 percent for the prior equivalent period (Schedule 1 clause 9(2)). If ITC entitlement is not notified, it defaults to 100 percent and removes potential premium discounts (Schedule 8 clause 2(2)). If seeking the apprentice incentive A, ensure the wage notices required by clause 147 of the Regulation are supplied or A will be taken as zero (Schedule 10 clause 2(2)).
Decide payment method and claim discount if eligible
For a 12-month policy, elect to pay the discounted amount in full by the due date, do not elect instalments, and notify the insurer of a reasonable wages estimate to secure the 3 percent discount (clause 4). Verify whether the discounted premium is above the $175 minimum (Schedule 6 clause 1-3).
Choose motor vehicle allowance calculation method and keep records
If motor vehicle allowances are paid and exclusion is sought, choose between:
a) Continuous recording: keep odometer readings for each business journey, record the purpose and calculate total business distance (Schedule 1 clause 4); or
b) Averaging method: conduct and retain a 12-week relevant period record with specified odometer and percentage calculations, then apply the derived percentage for up to four successive periods, refreshing records thereafter (Schedule 1 clause 5).
Retain all records for audit and insurer verification. If averaging method is used and vehicles are replaced, record replacement nominations in writing (Schedule 1 clause 7).
Establish and preserve claims and wages history for S and E calculations
Maintain accurate claims cost records (C0, C1, C2) and wages (W0, W1, W2) as used in Schedule 5 for E calculations and Schedule 4 for S (Schedule 5 clause 1; Schedule 4 clause 1). If the employer has a predecessor or has been previously self-insured, compile the predecessor’s claims and wages history as per Schedule 4 clause 4 and Schedule 4 clause 3.
Group membership and departing member situations
If part of a group, understand that TG−AG aggregation applies for cap determinations and that the group’s member histories and supplied particulars determine whether S for group members is calculated on a group basis (clause 3(3); Schedule 4 clause 2; Schedule 8 clause 3). Where a group member departs during calculation periods, apply Schedule 5 clause 3 formulas for reallocation; engage actuarial assistance where necessary.
Apply for Authority relief where eligible
Where breaks in insurance have occurred and you seek a reduction in S, prepare an application to the Authority under Schedule 4 clause 5. The Authority may develop eligibility criteria and calculation methods; consult any published criteria and guidelines before applying. For premium reduction tied to employment of previously injured workers, follow the Authority’s guidelines under Schedule 7 clause 4.
Check the prescribed excess and injury notification processes
To avoid the employer prescribed excess under s 160(1), ensure injuries that lead to weekly compensation claims are notified to the relevant insurance scheme agent within 5 days of the employer becoming aware of them (clause 5). Put internal processes in place to capture and notify injuries promptly.
Monitor and prevent late payments
Ensure premium payments are made by the due date. Clause 6 prescribes a late payment rate of 0.977 percent per month compounded monthly for ss 170(8) and 172(5) calculations. Where instalment arrangements are used, ensure those instalments are met to avoid compounding interest.
Record retention and audit readiness
Keep all classification evidence, wage returns, GST/ITC documentation, odometer readings and purpose records, apprenticeship wage records, injury notifications and insurer correspondence. The Order authorises insurers to use prior period calculations or default assumptions where records are incomplete; good recordkeeping prevents exposure to higher assessed premiums and default calculations.
Engage with insurer and Authority proactively
Where classification, group status, predecessor relationships or self-insurer history is complex, engage with the insurer early to present supporting documentation. Where relief from experience adjustments is sought, obtain the Authority’s guideline and application form and follow the specified process for evidence and submission.
Technical assistance
Many elements (S and E calculations, group reallocations on departing members, ICCR calculations across multiple classes) are numerically complex. Practitioners should involve actuaries or experienced premium-modelling advisers to ensure proper implementation and to verify insurer calculations against the Order formulas (Schedule 4 and Schedule 5 contain formulae incorporating Employer Claims Cost Rates, Industry Claims Cost Rates and cost of claims totals).
Final compliance note
The Order repeatedly conditions its calculations on returns and regulatory notices made "in accordance with the regulations" and on the text of Tables A and B published in the Gazette. Ensure compliance with both the Order and the referenced regulations and obtain the official Table A/B texts from the Gazette cited in the Order’s editorial notes to perform accurate calculations.
Section 6Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
M is the Mine Safety Fund premium adjustment, if any, for the employer calculated with respect to the period of insurance in accordance with Schedule 9.
A is the apprentice incentive amount, if any, for the employer determined with respect to the period of insurance in accordance with Schedule 10.
(2) However, where the basic tariff premium less the apprentice incentive amount [T − A] for a policy of insurance whose total premium is to be calculated under subclause (1) (a):
(a) is less than $50,000 (or, if the period of insurance is to be less than 12 months, where the basic tariff premium less the apprentice incentive amount [T − A] would be less than $50,000 were that period of insurance to be 12 months), the experience adjusted premium [(T × (1 − S)) + (E × S)] is not to exceed one and a half times the amount of that basic tariff premium [1.5 × T], and
(b) is or exceeds $50,000 but is less than $150,000 (or, if the period of insurance is to be less than 12 months, where the basic tariff premium less the apprentice incentive amount [T − A] would be or would exceed $50,000 but would be less than $150,000 were that period of insurance to be 12 months), the experience adjusted premium [(T × (1 − S)) + (E × S)] is not to exceed twice the amount of that basic tariff premium [2 × T], and
(c) is or exceeds $150,000 but is less than $300,000 (or, if the period of insurance is to be less than 12 months, where the basic tariff premium less the apprentice incentive amount [T − A] would be or would exceed $150,000 but would be less than $300,000 were that period of insurance to be 12 months), the experience adjusted premium [(T × (1 − S)) + (E × S)] is not to exceed two and a half times the amount of that basic tariff premium [2.5 × T].
(3) However, if the employer is a member of a group:
(a) subclause (2) does not apply, and
(b) where the sum of the basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] for all the members of that group:
(i) is less than $50,000 (or, if the period of insurance is to be less than 12 months, where the sum of basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] would be less than $50,000 were that period of insurance to be 12 months), the experience adjusted premium for the employer’s policy [(T × (1 − S)) + (E × S)] is not to exceed one and a half times the amount of the employer’s basic tariff premium [1.5 × T], and
(ii) is or exceeds $50,000 but is less than $150,000 (or, if the period of insurance is to be less than 12 months, where the sum of basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] would be or would exceed $50,000 but would be less than $150,000 were that period of insurance to be 12 months), the experience adjusted premium for the employer’s policy [(T × (1 − S)) + (E × S)] is not to exceed twice the amount of the employer’s basic tariff premium [2 × T], and
(iii) is or exceeds $150,000 but is less than $300,000 (or, if the period of insurance is to be less than 12 months, where the sum of basic tariff premiums less the sum of apprentice incentive amounts [TG− AG] would be or would exceed $150,000 but would be less than $300,000 were that period of insurance to be 12 months), the experience adjusted premium for the employer’s policy [(T × (1 − S)) + (E × S)] is not to exceed two and a half times the amount of the employer’s basic tariff premium [2.5 × T],
where:
AG is the sum of apprentice incentive amounts (if any) for all the members of the group calculated:
(a) where the period of insurance to which the premium relates is 12 months—in accordance with Schedule 10 with respect to that period of insurance, or
(b) where the period of insurance to which the premium relates is not 12 months—in accordance with Schedule 10 as if the policies to which the premiums relate had a period of insurance of 12 months.
TG is the sum of the basic tariff premiums for all the members of the group calculated:
(a) where the period of insurance to which the premium relates is 12 months—in accordance with Schedule 3 with respect to that period of insurance, or
(b) where the period of insurance to which the premium relates is not 12 months—in accordance with Schedule 3 as if the policies to which the premiums relate had a period of insurance of 12 months.
4 Discount available for premiums paid in full
4 Discount available for premiums paid in full
4 Discount available for premiums paid in full
An employer is entitled to a discount of 3 percent on the initial premium payable by the employer for a policy of insurance if:
(a) the period of insurance to which the policy relates is 12 months, and
(b) the employer has paid the discounted amount of the premium in full by the date on which payment of the premium is due, and
(c) the employer has not elected to pay the premium by instalments, and
(d) the employer has notified the insurer, in accordance with the regulations, of the reasonable estimate of the wages that will be payable during the period of insurance.
Note—
Clause 147 of the Workers Compensation Regulation 2010 requires an employer to notify the insurer concerned of the matter referred to in paragraph (d).
5 Recovery of excess from employer: section 160 of Act
5 Recovery of excess from employer: section 160 of Act
5 Recovery of excess from employer: section 160 of Act
For the purposes of the definition of prescribed excess amount in section 160 (1) of the Act, the following excess amount is specified:
(a) if the employer concerned notified the relevant insurance scheme agent of the injury that led to the weekly compensation claim of the worker within 5 days of the employer becoming aware of it—$0,
(b) in all other cases—the lesser of the following:
(i) the amount that is the weekly payment of compensation to which the worker is entitled as determined by section 36 of the Act,
(ii) $1,838.70.
Note—
Under section 160 (2) of the Act, an employer is required to repay the prescribed excess amount to the insurer under a policy of insurance in respect of each weekly compensation claim that the insurer has paid under the policy. However, if the amount that the insurer has paid in respect of any such claim is less than the prescribed excess amount, the amount the employer must repay is that lesser paid amount.
cl 5: Am 2012 (683), cl 3.
6 Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
6 Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
6 Late payment prescribed rates: sections 170 (8) and 172 (5) of Act
For the purposes of sections 170 (8) and 172 (5) of the Act, the prescribed rate is 0.977% per month compounded monthly.
7 Calculation of costs of individual claims and provisional payments of compensation: clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of Regulation
7 Calculation of costs of individual claims and provisional payments of compensation: clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of Regulation
7 Calculation of costs of individual claims and provisional payments of compensation: clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of Regulation
For the purposes of clauses 154 (2) (d) (ii) (C) and 155 (2) (d) (ii) (C) of the Workers Compensation Regulation 2010, the amount specified is $1,838.70.
8 Exemption limit for certain employers: section 155AA (8) of Act
8 Exemption limit for certain employers: section 155AA (8) of Act
8 Exemption limit for certain employers: section 155AA (8) of Act
The exemption limit (within the meaning of section 155AA (8) of the Act) for an employer who carries on a business that is covered by Table A’s classes 612310, 612315, 612320, 612322, 612324, 612326, 612330, 931120, 931130, 931920, 931930, 931940 or 931950 (being classes that refer to a per capita rate), regardless of whether the employer carries on any other business, for the 2012–2013 financial year is fixed at $0.
Note—
The effect of fixing the exemption limit for the specified employers at $0 is that those employers will not be “exempt employers” within the meaning of section 155AA (Exempt employers not required to obtain policy of insurance) of the Act.
9 Schedules form part of Order
9 Schedules form part of Order
9 Schedules form part of Order
Schedules 1–13 form part of this Order.
Schedule 1 Interpretation
Schedule 1 Interpretation
Schedule 1 Interpretation
(Clause 9)
1 Definitions
1 Definitions
1 Definitions
(1) In this Order:
apprentice has the same meaning as in the Apprenticeship and Traineeship Act 2001.
apprentice incentive amount, in relation to an employer, means the amount calculated in accordance with Schedule 10.
basic tariff premium, in relation to a policy, means the basic tariff premium for the policy calculated in accordance with Schedule 3.
claim means a claim made by a person against an employer to which a policy relates.
dust diseases contribution, in relation to an employer, means an amount equivalent to the contributions, if any, payable by an insurer in respect of the employer to the Workers’ Compensation (Dust Diseases) Fund (plus any GST payable) that is calculated in accordance with Schedule 11.
employer includes a person who proposes to become an employer.
input tax credit entitlement, in relation to an employer, means the amount of input tax credit that may be claimed by the employer in accordance with the A New Tax System (Goods and Services Tax) Act 1999 of the Commonwealth in respect of the issue or renewal of a policy of insurance expressed as a percentage of the GST payable by the employer in respect of the issue or renewal of that policy.
insurer means a licensed insurer, or a former licensed insurer, within the meaning of the Act.
limited proprietary company means a proprietary company limited by shares as referred to in section 112 of the Corporations Act 2001 of the Commonwealth.
NSW WorkCover Industry Classification System or NSWWIC System means the industry classification system set out in Table B.
per capita rate means a rate specified in Column 3 of Table A that is expressed otherwise than as a percentage.
period of insurance, in relation to a policy, means a period for which an insurer assumes risk under the policy, being a period that commences on the first day on which the policy is in force after having been issued or renewed.
policy or policy of insurance means a policy of insurance within the meaning of the Act.
predecessor—see clause 10.
premiums adjustment contribution, in relation to an employer, means an amount equivalent to such part of the contributions, if any, payable by an insurer to the Insurance Fund under section 208 or 208AA of the Act as relates to the premium payable by the employer to the insurer.
regulations means regulations under the Act.
Table A means the Table set out in Schedule 12.
Editorial note—
For the text of Schedule 12 see Gazette No 66 of 27 June 2012, p 2608 (see also erratum in Gazette No 72 of 13 July 2012, p 3355). The Gazette can be accessed at the following website: http://nsw.gov.au/gazette/2012
Table B means the Table set out in Schedule 13.
Editorial note—
For the text of Schedule 13 see Gazette No 66 of 27 June 2012, p 2633. The Gazette can be accessed at the following website: http://nsw.gov.au/gazette/2012
the Act means the Workers Compensation Act 1987.
wages means wages as defined in section 174 (9) of the Act, but does not include a motor vehicle allowance or accommodation allowance to the extent that the allowance is required to be excluded from wages by clause 3.
(2) The value of any amount of money calculated or included in a calculation under this Order is to be expressed in dollars.
(3) In this Order, a reference to wages that are payable by an employer includes a reference to wages that have been paid by the employer.
(4) In this Order, a reference to any GST that is payable by an employer includes a reference to GST that has been paid by the employer.
(5) In this Order, a reference to any input tax credit that may be claimed by an employer includes a reference to any input tax credit that has been claimed by the employer.
2 Meaning of small, medium and large employer
2 Meaning of small, medium and large employer
2 Meaning of small, medium and large employer
(1) In this Order:
large employer means an employer whose basic tariff premium for an insurance policy at the time at which the insurer demands a premium for the policy:
(a)
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