Two different weekly-payment inputs
What is the difference between actual earnings and post-accident earning capacity?
Actual earnings show what was earned; capacity estimates what could be earned
Actual post-accident earnings come from work performed after the crash and are proved by payroll or business records. Post-accident earning capacity is a statutory assessment of the weekly amount the person can earn. For weeks 1 to 78 it concerns fitness for the pre-accident employment; after week 78 it concerns any employment reasonably available to the person. The weekly formula can use whichever of actual earnings or assessed capacity is greater, so both figures and the evidence behind them must be checked.
A person may have no wages because an employer has no suitable duties, yet the insurer may assess some capacity. Another person may earn above an assessed capacity during a short work trial without proving that those hours are sustainable. The concepts overlap factually but are not interchangeable.
Schedule 1 clause 8 identifies different statutory considerations before and after week 78. The Motor Accident Guidelines add factors for employment reasonably available after week 78. The decision should therefore identify the relevant period and the employment used in the assessment.
Reviewed by Herman Chan, Stephen Young Lawyers
How are actual earnings proved?
For an employee, use gross payslips, payroll summaries, rosters, overtime records and employer confirmation. Allocate arrears, bonuses and commissions to the correct period where possible. A bank statement proves receipt but may not explain when the income was earned or whether it was wages, leave or reimbursement.
For a contractor, platform worker or business owner, use invoices, platform statements, business accounts, expenses and evidence of personal work. Revenue generated by employees or payment of an old invoice may not show the claimant’s current labour. Conversely, cash work and another income source must not be omitted.
Actual earnings can vary weekly. A calculation that uses one selected payslip or an unexplained average should be tested against the complete sequence and the statutory weeks it affects.
How is post-accident earning capacity assessed?
During the first and second entitlement periods, Schedule 1 clause 8 focuses on capacity in the employment held immediately before the accident. The insurer considers the injury and recovery, treatment and rehabilitation needs, post-accident earnings and Certificates of Fitness. A job title alone does not establish the hours or duties the person can safely perform.
After week 78, the test broadens to employment reasonably available in light of fitness. The Act refers to injury, treatment, rehabilitation, training, skills, experience, age and medical certificates. Guidelines clause 4.60 also identifies education, pre-injury work, residence, time seeking work and other relevant circumstances.
Capacity is not a guarantee that an employer will offer a job. However, labour-market availability becomes especially important after week 78. Ask the insurer to identify the proposed occupations, hours, pay rates, location, restrictions and evidence rather than accepting a bare dollar figure.
How should a claimant respond when the figures differ?
Build a comparison table with actual hours and gross earnings in one column and the insurer’s proposed work, hours and rate in another. Add the Certificate of Fitness, treating reasoning, role demands, work trials and vocational evidence. This shows whether the difference comes from missing wages or an unrealistic capacity assumption.
Worked example: actual earnings are $240 for one short shift, while the insurer assesses $720 capacity for three shifts. The claimant should not argue only that the payslip says $240. The response should address why three shifts are unsafe, unavailable or unsustainable and support that explanation with medical, workplace and vocational evidence.
A written amount or capacity decision can attract internal review and PIC merit review. Identify the exact decision and follow its review notice. A complaint about service does not replace the statutory review process for the amount.
Practical next steps
Test an earning-capacity decision
Compare the real work record with the insurer’s assumed work.
Identify the entitlement period
The legal capacity test changes after week 78.
Record actual work and earnings
Use rosters, duties, payslips and business evidence for each week.
Obtain the insurer assumptions
Ask for proposed jobs, hours, rates, restrictions and source material.
Address sustainability and availability
Use treating, workplace, vocational and labour-market evidence.
Use the correct review process
Challenge the amount or capacity decision, not merely the insurer’s service.
Evidence
Actual earnings and capacity evidence
The evidence should answer both what occurred and what could realistically occur.
- Gross payslips, rosters and timesheets.
- Complete role description and inherent duties.
- Current Certificates of Fitness and treating reports.
- Work-trial records, failed shifts and symptom response.
- Employer statement about available duties and hours.
- Vocational assessment and identified occupations.
- Labour-market and pay-rate evidence where relevant.
- The insurer’s calculation and reasons.
Common capacity errors
- Zero earnings do not automatically establish zero capacity.
- One successful shift does not automatically prove ongoing full capacity.
- A Certificate of Fitness should be read with its restrictions and clinical basis.
- Before week 79, do not silently substitute any theoretical job for the statutory pre-accident-employment test.
- After week 78, do not ignore whether proposed employment is reasonably available.
Timing
Act on the written decision
Capacity assessments can affect the next payment quickly.
- Keep the date the capacity or weekly-amount decision was received.
- Read the internal-review and PIC instructions in that decision.
- Request the relied-on vocational and medical material promptly.
- Do not wait for a later certificate to assume the original review time has restarted.
Frequently asked questions
- If I earn nothing, must the insurer treat my capacity as zero?
- No. The Act allows a separate assessment of capacity. That assessment must still apply the correct period and be supported by evidence.
- Can the insurer assess a job I have never done?
- After week 78, any reasonably available employment may be considered with your skills, experience, age, injury and other statutory factors. Earlier periods use a different test.
- Are actual wages always used if they are higher?
- The weekly formulas refer to the greater of actual post-accident earnings or assessed capacity, subject to the applicable section and limits.
- Does a medical certificate decide capacity by itself?
- It is important evidence, but the Act lists other considerations. The insurer must make the legal decision and explain it.
- What if suitable work exists but my employer will not offer it?
- Keep the employer evidence. Availability and the statutory period matter, and the insurer should explain any different capacity assumption.
- Is this a PAWE dispute?
- Not necessarily. PAWE is the pre-accident baseline. Actual earnings and post-accident capacity are separate inputs.
Related NSW CTP guides
Official sources
- Motor Accident Injuries Act 2017 (NSW), current in-force version
- Motor Accident Injuries Regulation 2017 (NSW), current in-force version
- SIRA Motor Accident Guidelines, current published version
- SIRA Motor Accident Guidelines Part 4: claims
- Personal Injury Commission: merit review disputes
This page is based on the current Motor Accident Injuries Act 2017, the Motor Accident Injuries Regulation 2017 and Motor Accident Guidelines version 10.1. The correct result depends on the accident date, entitlement period, written insurer decision and current evidence.
Capacity and payment review
Does the insurer’s capacity figure exceed what you can realistically earn?
Send the written decision, payslips, Certificate of Fitness, role information and vocational evidence. We can identify the assumptions that require review.
General information only: This page provides general NSW CTP information, not legal, employment, accounting, tax or financial advice. It does not calculate an individual weekly benefit, determine work capacity, guarantee a review outcome or extend any time limit.