Workers' compensation is compulsory for almost every Australian employer, and it's run separately by each state and territory scheme (icare in NSW, WorkSafe in Victoria, WorkCover in Queensland, and so on). Your premium is not a flat fee — it's built from your wages and how risky your industry is, so the same payroll can cost very different amounts depending on what your business does and where.
At its simplest, premium = rateable wages × an industry rate. Rateable wages are your total wages bill including most superannuation and allowances. The industry rate is set by your workplace's classification — a clerical office attracts a low rate (often well under 1%), while construction, manufacturing or aged care can be several times higher because injuries are more frequent and more expensive.
For larger employers, schemes apply experience rating: your recent claims history adjusts the premium up or down from the industry benchmark. A clean safety record can pull your premium below the base rate, while a run of serious claims pushes it above. Smaller employers below a wages threshold usually pay the standard industry rate without experience adjustment, which is why the estimate above is a starting point rather than a quote.
The policy funds weekly payments to replace lost wages when a worker is injured, their medical and rehabilitation costs, and lump sums for permanent impairment. It protects the business too — without cover, an employer can be personally liable for those costs plus penalties. Premiums are a deductible business expense.
Do I need cover for contractors? Often yes — if a contractor is really a worker in substance, or is deemed a worker under scheme rules, their payments may be rateable. Misclassifying workers as contractors is a common and costly mistake.
Does super count in rateable wages? In most schemes, yes — superannuation and many allowances are included alongside ordinary wages.
Why did my premium jump this year? Usually a rise in your wages bill, a reclassification of your industry, a new claim flowing into your experience rating, or a scheme-wide rate change.
This calculator uses current published rates from Australian government and regulator sources. The result is an estimate for general guidance — it does not constitute personal financial advice. For decisions about your circumstances, consult a registered financial adviser, tax agent, or other professional. See editorial standards for how DecisionLab sources and updates its calculator data.
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