Guideline on the Definition of Wages
For the purpose of calculating workers compensation premiums
This guideline has been developed to assist parties who are involved in applying section 96A of the Act.
The objectives of this guideline are:
- To provide a comprehensive guideline on wages components for licensed insurers, self-insurers (for their notional premium calculations), auditors, accountants, brokers, employers and other interested parties.
- To provide a consistent basis of premium assessment.
- To provide a framework for review of contentious issues.
The basic principle adopted by WorkCover Tasmania in deciding whether specific payments or benefits made to workers are considered to be "wages" is that, where they are made in return for the worker's labour, such payments in cash or in kind, constitute wages assessable for workers compensation premium calculation purposes.
Exceptions to this principle occur where there are specific exclusions under the Act, where there is a work-related reason for the expenditure being incurred by the workers, or where the benefit is incidental to the worker's employment.
It is important to note that the definition relates only to wages for the establishment of premiums and has no relationship to the payment of weekly entitlements to an injured worker covered by workers compensation.
This guideline is intended to assist in the interpretation of section 96A of the Act, but should not be regarded as authoritative. It indicates the manner in which WorkSafe Tasmania interprets this section, with a view to encouraging uniform application of the section. The Guideline is not intended as legal advice, and users of the Guideline should not rely upon it, but should rely on the advice of their own legal advisers. The proper interpretation of section 96A is ultimately a matter for the Courts.
Any enquiries regarding the application of the Definition of Wages should be forwarded to:
PO Box 56
ROSNY PARK TAS 7018
Phone: Helpline 1300 366 322 (inside Tasmania)
(03) 6166 4600 (outside Tasmania)