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14.3 NWE in relation to 'transitional' (i.e. pre-SRCA) cases

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Neither the 1971 Act nor the 1930 Act determined the amount of incapacity payments by the use of Normal Weekly Earnings or any similar concept. These Acts set the quantum of the weekly payment by reference to a set statutory rate. That rate is then subject to variation by the addition of other specified amounts paid in respect to the number and nature of dependants, etc.

Section 25 of the 1971 Act does provide for an amount titled 'Average Weekly Earnings' (AWE) to be calculated using a period of unspecified length taken from immediately before the injury and not earlier than 12 months prior to it. However, the function is quite different to that of NWE. The AWE represents a maximum payment – i.e. a ceiling – for incapacity benefits. As such, it is/was not required to be calculated in every case where a client was incapacitated which is fortunate as the procedures for calculation of AWE are complex and time consuming.

Subsections 124(1A) and (2) of the SRCA provides that compensation is payable under the SRCA for an injury occurring under the earlier Acts, providing only that compensation would also have been payable under the 1971 Act or the 1930 Act, had those Acts not been repealed. The proper interpretation of this provision, is that a period of incapacity arising under the SRCA is to be paid in the manner specified under the SRCA (i.e. calculated by mean of S19, 20, 21, etc.) even though the injury responsible for that incapacity originated under an earlier Act.

  • This means that the delegate must determine an NWE in those cases. That NWE will usually be the rank/pay level at the date of discharge.

However in cases where a delegate is retrospectively paying incapacity benefits in respect of a period of incapacity which occurred before the commencement of the SRCA Section 127(7) applies. This section requires the payment to be calculated by the method in force at the time of the period of incapacity.

  • This means that for periods of incapacity occurring before 1 December 1988, delegates should not determine NWE but pay compensation in accordance with the statutory rates current at that time.