When compensating employees for lost earnings due to workplace injury, specific calculation rules apply.
Key payment principle
Pay a maximum of 80% of pre-injury income.
⚠️ You should not calculate 80% of their hourly rate or average daily pay rate, which could be different calculations. The calculation is based on actual pre-injury income.
The optimal approach depends on several factors related to timing and income patterns.
Payment scenarios
Injury occurs mid-week (payment split across pay periods)
The starting point of the compensation (i.e. from the time the employee was injured) can often happen during a pay period, requiring ACC payments to be split.
In these cases:
Pay up to 80% of pre-injury income in the first period.
Pay the remaining balance in the second period.
Employee absent less than one week
Pay up to 80% of pre-injury income for the absence period.
Employee absent one week or more with regular income
Choose one of these methods:
Option 1: Use ACC as "Time Worked" category
Apply "1st week ACC" pay code.
Use a 0.8 multiplier (representing 80%).
⚠️ Leave types don't support multiplier options, so this must be used as a work-type code.
Option 2: Use "Leave Taken" category
Pay 4 days of ACC leave for employees working 5-day weeks (4/5 = 80%).
Select "I know how much the employee would have earned" in the leave wizard.
Employee absent one week or more with irregular income
Pay 4 days of ACC as "Leave Taken" category using the employee's Average Daily Pay rate.
For 5-day work weeks: 4/5 = 80% of normal earnings.
Additional resources
For more information about ACC workplace injury requirements, refer to: ACC: What to do when an employee is injured