Business ACC levies to vary

Businesses that have fewer workplace accidents will pay cheaper ACC levies and those with higher accidents will pay more under plans unveiled this afternoon.

ACC Minister Nick Smith said 'experience rating' on levies would be introduced for businesses from April 1.

The new system would base ACC levies on the number of workplace accidents that result in ACC claims, and would apply to business that paid more than $10,000 a year in workplace levies.

Under the system, levies would either be discounted or loaded by up to 50 per cent depending on claims history.

Dr Smith said the system would affect about 5000 workplaces employing more than 30 workers each. It would cover about 690,000 workers, just under a third of the national workforce.

He said the system would reintroduce the experience rating that had applied from ACC's inception in 1972 till Labour scrapped the provision in 2000, and make it fairer for business with better workplace safety records.

“New Zealand’s workplace safety does not compare well internationally with more than one worker killed and another 600 injured each week,” Dr Smith said.

“The averaged levy system means businesses with good workplace safety are carrying the cost of others that are less safe. This detracts from the incentives for improving safety. The new system of accident experience rating will reward those businesses that have safer work and return to work practices."

He said experience rating was more difficult for smaller employers, so a no-claims/high claims bonus and loading system would apply.

This would mean that if no weekly compensation claim was lodged in the preceding three years, the employer would receive a 10 percent no-claim bonus on their ACC levies. 

Penalties would apply where there were more than four weekly compensation claims in the past three years.

An expected 220,000 small businesses would receive discounts under the proposed policy and approximately 1000 would pay penalties.

Dr Smith said ACC would consult with employers and workers over the coming months on the details of the proposal.

The Council of Trade Unions has in the past signalled concerns about a return to experience rating, warning that it could result in dangerous workplaces trying to cover up accidents by not reporting them or pressuring workers not to take ACC claims.