October 01 - Tax Accounting

Everything You Need To Know About Work Cover

A short and sweet one today, covering a topic we get asked about all the time: work cover. A surprising number of business owners don’t realise that this is an absolutely *essential* piece of compliance that you must follow. Here are your questions answered to clear the whole thing up!

What is work cover?

It’s insurance that pays for medical costs and income replacement costs when an employee is injured in the workplace.   

Who needs work cover?

Any business that employs trainees or apprentices, or if you have employees and pay more than $7,500 per financial year in remuneration (Victorian threshold). Although there are differences between inclusions and exclusions in each state, it is a required insurance throughout Australia. You can get state-by-state guidelines below.

VIC WorkSafe

QLD WorkSafe

NSW WorkSafe

NT WorkSafe

WA WorkSafe

TAS WorkSafe

Why do I need work cover?

It’s a legal requirement. If an employee gets injured on the job, you must provide payments which do things like cover any lost income and medical bills. Exactly what this looks like will vary case-by-case but the insurance covers you for any financial circumstance that may arise as a result of the incident.

How do I get work cover?

Each state has their own authority and the application is made online on the relevant WorkSafe website. During the application process you will potentially be required to choose the claims agent (businesses like Gallagher Bassett, EML Allianz, Zurich, DXC Claims), depending on the state. Head back to the websites linked above to find the guidelines most relevant to you.

Important note: if your employee works for you in multiple states, you only need to insure them in one state or territory.

How much does work cover cost? 

The amount paid (premium) per year is based on the wages and benefits (the total remuneration) paid to employees.  Remuneration has multiple components but the main two to consider are super and wages. The percentage applied to calculate the premium is based on the industry you work in – again find this via your state’s WorkSafe website linked above. The minimum cost in Victoria is $330.00 ($363.00 including GST).

Any other considerations to know about?

  • Each year you must calculate your total employee remuneration to the workcover insurer by 22 March for small employers (total remuneration of under $200k) or 27 Oct for larger employers 
  • The above is a summarised version! Further research and review on how this applies to your business should be undertaken before applying   

Can’t be bothered adding work cover to the list of things to do? No worries, give us a call and we can sort it out for you.