PAWE for Employees: The 52-Week Averaging Rule
For most employees, Pre-accident Weekly Earnings (PAWE) are calculated using a standard 52-week average. While this seems simple, disputes often arise about what counts as "gross earnings" and which weeks should be included. General information only.
1) The 52-week averaging rule
Under Schedule 1 of the Motor Accident Injuries Act 2017, the starting point for employees is the total gross earnings received in the 52 weeks before the accident, divided by 52.
If you were with your employer for less than 52 weeks, the average is taken over the actual period of your employment.
2) What counts as "Gross Earnings"?
It is a common mistake for insurers to only look at your "base rate". Legally, PAWE must include:
- Your normal salary or wages.
- Overtime: All overtime worked in the relevant period.
- Allowances: Shift allowances, site allowances, and other regular payments.
- Bonuses & Commissions: Any performance-based payments received.
Fringe benefits and non-monetary perks are generally excluded from the PAWE calculation.
3) Handling unpaid leave and gaps
If you had gaps in your employment or periods of unpaid leave (e.g. for travel or health) during the 52 weeks, simply dividing by 52 may result in an artificially low PAWE. There are legal arguments to have these periods adjusted so that your weekly payments accurately reflect your "earning capacity".
4) Why you should check the insurer’s math
Insurers often rely on a single employer summary or a limited set of payslips. If they miss one large bonus or a period of high overtime, your weekly payments could be underpaid for the entire life of your claim. Contact us to have your PAWE calculation audited by a specialist.
Frequently asked questions
- Does PAWE include overtime and bonuses?
- Yes. Gross earnings include salary, overtime, bonuses, shift allowances, and commissions. These should all be included in the 52-week averaging calculation.
- What if I was on unpaid leave during the 52 weeks?
- Periods of unpaid leave can sometimes distort the average. In certain cases, these periods may be excluded or the averaging adjusted to ensure the PAWE reflects your actual earning capacity.
- How do I prove my earnings?
- Payslips, group certificates (Income Statements), and bank statements are the primary evidence. It is important to provide a full 52-week history to ensure nothing is missed.