Who pays for the first week after a work injury in New Zealand?

The employer does. For a work related injury the employer pays first week compensation at 80 percent of the employee's earnings for the first week off work, and ACC picks up weekly compensation from the second week onwards at the same 80 percent rate. That first week is a direct cost to the business and is separate from any levy effect.

Does a claim increase my ACC levy?

It can. ACC runs experience rating and safety programmes that adjust a business's work levy up or down based on its claims history relative to others in its classification unit. The effect depends on the size of the business and the programme it sits in, so enter your own estimate rather than assuming a fixed number.

What costs do businesses usually miss after an incident?

The time. Investigating properly, notifying WorkSafe where the incident is notifiable, retraining, and covering the absent person all consume hours from people who are not doing their normal jobs, and those hours rarely appear in any report. Lost productivity while a replacement gets up to speed is usually larger than the compensation itself.

Workplace Incident Cost Calculator NZ 2026

This calculator works out what a workplace injury actually costs the business, which is almost always several times the compensation figure people have in mind. You enter the injured person's weekly earnings, how long they are off, your cover arrangements, the hours spent investigating and reporting, and any equipment, retraining or levy effect, and it returns the total with each part shown separately. The first week is the piece many employers do not realise is theirs. For a work related injury the employer pays first week compensation at 80 percent of the employee's earnings for the first week off work, and ACC takes over weekly compensation from the second week at the same rate. So a short absence is entirely your cost, and a long one is your first week plus everything else. Everything else is where the real money is. Covering the absent person, the hours your managers and health and safety people spend investigating and notifying WorkSafe where the incident is notifiable, retraining, replacing damaged equipment, and the period where a replacement is not yet up to speed all consume real money that rarely appears in any report. On top of that sits the levy: ACC runs experience rating and safety programmes that move a business's work levy up or down based on its claims history against others in its classification unit, and the size of that effect depends on your business and your programme, so it is entered here rather than assumed.

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Their weekly earnings

Weeks off work

Weekly cost of cover

Investigation and reporting hours

Loaded hourly cost of that time

Equipment, repairs and retraining

Extra ACC levy over the next year

First week compensation rate

$15,420

total cost of this incident to the business

First week you pay$1,040

Cover while they are away$8,400

Investigation time$1,680

Equipment and levy$4,300

ACC pays weekly compensation from the second week; the first week is yours at 80% of earnings. Everything after that first week is cover, time and consequence rather than compensation, which is why the total runs well above the figure most people have in mind.

How it works

First week compensation is the injured person's weekly earnings multiplied by the first week rate, and it applies only if they are off for a week or more. From the second week ACC pays weekly compensation directly, so nothing further from that appears in your total. Cover is your weekly cover cost multiplied by the whole period they are away, because the work still has to be done. Investigation time is the hours you enter multiplied by the loaded hourly cost of the people spending them, which should be their real cost to the business rather than their base salary. Equipment, repairs, retraining and any extra ACC levy are added as entered. The result is the cost the business carries, not the cost to the injured person, whose income after the first week comes from ACC.

Worked example

Someone earning $1,300 a week is injured at work and is off for six weeks. You pay first week compensation of 80 percent of their weekly earnings, which is $1,040, and ACC covers weekly compensation from week two onwards. Cover at $1,400 a week for the six weeks costs $8,400. Investigating the incident and reporting it takes 24 hours of manager and health and safety time at a loaded $70 an hour, which is $1,680. Replacing damaged equipment and retraining costs $2,500, and the claim is expected to add $1,800 to your ACC work levy over the next year. The incident therefore costs the business about $15,420, of which only $1,040 is compensation.

Related calculators

ACC Weekly Compensation: what the injured person receives.
ACC Levy by Classification: the levy this affects.
True Cost of an Employee: the cost of the cover.
Span of Control: sizing a team that can absorb an absence.

Data sources: first week compensation and levy rules are maintained against ACC and Employment New Zealand. Not legal or health and safety advice. Figures are checked twice monthly.