Category 1
What does ERA stand for?
Employer reimbursement agreement
- Employer continues to pay the client whilst on Weekly Compensation and the ACC reimburses the Employer.
Abatement must always come from Employer via an ACC038 or MYACC business task
What does CPX mean?
Cover Plus extra
- Self employed or shareholder clients
- We don't abate
What is an employer top up?
Some employers will make payments to top up the client’s Weekly Compensation to the level of their pre-injury pay. That is, they pay the difference between what ACC pays in Weekly Compensation (80%) and what the client would have received had they been able to work.
This payment is made either from the client’s sick or annual leave entitlement or as a payment made at the employer’s discretion.
What is abatement?
Abatement is the formula we apply to the earnings the client receives in each week during incapacity to determine the proportion by which weekly compensation is reduced
What is a work pattern?
Work pattern is the days of the week the client works
Does a top up relate to work performed by the employee?
No
Name three types of earning which are liable to be considered as abatement?
Salary/ Wages
Holiday Pay
Termination Pay
Stat Holiday Pay
Taxable Bonuses
Commision
Name three types of earnings which aren't considered liable for abatement?
-Redundancy
-Superannuation
-Weekly Compensation
-Employer Top ups (20%)
-Parental Leave Payments
-Anything without an earner levy attached
Why is work pattern important for abatement and what should you do if a client has a new job from when they were originally injured?
When we make a payment to a client, we only pay them for days they would ordinarily work in that employment. If, for example, a client works Monday to Friday when they are injured, they are also only paid for those days from ACC.
When it comes to abatement, we also apply abatement against the client’s ordinary work pattern.
Enter in new employment as a post incapacity employer and enter in new work pattern- abatement factors this in.
Name three ways how a clients abatement details can be gathered-
-RTE (with permission or if delayed set up)
-Payslips from client
-Employer- ERA abatement via an ACC038
-Employer- email, verbal, payslips
Recovery Team can also negotiate a weekly abatement especially common with self employed and shareholder clients.
Name the three different types of earners for the purpose of weekly compensation?
-Employee (PAYE)
-Self Employed (Schedular or withholding payments, partnership income or self employed income- Declared at clients financial year)
-Shareholder (PAYE as you earn or EOY- End of year allocation)
or combination of both.
Name two exceptions to the rule of abatement is abated over the period to which the payment relates to.
-One off taxable bonuses
- Any period relating to a previous tax year
What is a rate of abatement?
A set amount that is applied over a defined period and can either be applied weekly or fortnightly.
(Frequency drop down in EOS MATTERS)
What is an amount of abatement?
An amount is a payment that has been received by the client that relates to a specific period.
Frequency drop down DOES NOT Matter
Name three ways other than Rate and Amount of how we can abate a period?
- Hourly Rate
- Hours per week
-Percentage