CTP Insurance, Insurance

PAWE Calculation Conundrums

12 February, 2024

In Brief

  • In calculating PAWE, only income actually received before the day of the accident is relevant.
  • Undocumented earnings remain relevant to the calculation of PAWE but the onus is on the Claimant to establish, on the balance of probabilities, that the cash they received was for personal exertion labour.


On 9 February 2024, the Personal Injury Commission published its decision in Kipkorir v Insurance Australia Limited t/as NRMA Insurance [2024] NSWPICMR 3.

On or before 4 August 2023, the Claimant entered Australia on a student visa, which precluded the Claimant from working more than 48 hours in a fortnight during study terms.

The Claimant was involved in a motor vehicle accident on 25 September 2023.

On 4 August 2023, the Claimant began to receive undocumented earnings as a labourer.

On 12 September 2023, less than two weeks before the accident, the Claimant began working as a casual freight handler.

The Insurer determined the Claimant’s Pre-Accident Weekly Earnings (PAWE) in the sum of $762.21.

The Insurer calculated the Claimant’s PAWE on the basis that the Claimant had not been earning continuously before he arrived in Australia.

The Insurer’s PAWE determination was confirmed on internal review.

The Claimant requested a merit review of the Insurer’s internal review decision.

The Merit Reviewer’s Reasons

 The Merit Reviewer set aside the Insurer’s PAWE determination and calculated PAWE at the lower amount of $460.60.

The Merit Reviewer reasoned as follows:

  • There was no dispute that the Claimant was an earner.
  • The words of clause 4(1)(a) of Sch 1 to the Motor Accident Injuries Act 2017 (MAIA) focusses attention on monies “received by the earner as an earner” in the relevant period before the accident.
  • Any earnings received on or after the day of the accident are excluded by the wording of clause 4(1)(a) even if the corresponding work was carried out before the day of the motor accident.
  • The onus is on the Claimant to demonstrate what income he received in the relevant period.
  • Deposits in the Claimant’s bank statement demonstrated he began to receive undocumented payments from 4 August 2023.
  • Accordingly, for the purpose of clause 4(2)(a) of Sch 1 to MAIA, the period over which the Claimant “started to earned continuously” was 4 August 2023 to 24 September 2023 (being the day before the accident).
  • The Claimant’s bank statements demonstrated that the Claimant received $421.56 as a freight handler and $3,000 of undocumented earnings for work as a labourer.
  • Given that the Claimant received a total of $3,421.56 during the relevant 52-day period his PAWE was $460.60.

Key Learnings

The decision in Kipkorir reiterates that Insurers should only look at income actually received by the Claimant before the relevant motor accident when calculating PAWE. Any income received post-accident should be excluded even if that income relates to work performed before the accident. This is because of the word “received” in clause 4(1)(a) of Sch 1 to MAIA.

Insurers should, however, include undocumented income in their calculations – even if untaxed – provided they are satisfied that the cash-in-hand relates to personal exertion labour.


If you have a query relating to any of the information in this case note, or would like to discuss a similar matter of your own, please don’t hesitate to get in touch with CTP Insurance Special Counsel Helen Huang today.


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