Gaps to watch if you have multiple jobs

Across Australia, more than a million people hold more than one job. It’s often a way to build income, diversify interests, or bridge into a new career. But if an injury puts them out of work, even temporarily, the cracks in state-based compensation systems can quickly show.

Workers compensation is designed to cover medical costs and part of your income if you’re injured on the job. But when you work more than one job, that income support may not reflect your full weekly earnings.

Here’s how it works, and where support may fall short.

A case of competing rules

Brie is 30 and works two jobs. Her main role is as a learning support assistant for a local primary school, and once a week she also works as a disability support provider. Together, she earns around $2,360 per week.

After a serious fall at the school, Brie finds herself unable to work for at least two months. Because the injury happened at her main workplace, she’s covered by that employer’s workers compensation policy. This means her salary from the school is partly covered, along with medical expenses.

But what about her second job?

That depends entirely on the state or territory where she works. Workers compensation is state-based, and each jurisdiction has its own rules about whether secondary income is included in the calculation of payments.

For example:

• In NSW and WA, the law explicitly allows earnings from more than one job to be counted in the compensation formula.
• In Victoria and Queensland, the picture is less clear. Income from a second job may be excluded, especially if the injury occurred during the first job and the second employer is unrelated.

Even though Brie cannot work either job due to her injury, she may only receive compensation for the role in which the accident occurred. This can come as a surprise to those who rely on multiple streams of income, particularly where a second job provides significant supplementary earnings.

Compensation is capped and often decreases

Another common issue is that compensation is capped. In NSW, for instance, the maximum weekly payment as at July 2024 is based on 95 percent of income, capped at $2,569.60 per week. That equates to around $134,000 annually. Victoria uses a cap based on 95 percent of $2,800 per week.

For higher-income earners, this may be far below their actual pre-injury earnings. The gap may widen further over time. In many states:

• You receive around 95 percent of your income for the first 13 weeks
• After that period, payments may reduce to 80 percent, depending on your location and whether you’ve returned to any form of work

If you do return in a reduced capacity, your partial earnings are factored in, often using a new calculation to determine the top-up amount. Again, the rules vary by jurisdiction.

Where a financial adviser can assist

These complexities are rarely front of mind until someone is injured and dealing with financial stress. A financial adviser can help make this period easier by offering practical and strategic guidance.

Support may include:

• Reviewing your cashflow and helping to restructure a short-term budget
• Recommending a legal review if you may be entitled to additional compensation
• Assisting with hardship applications or loan deferrals
• Reviewing your super to determine if early access under hardship provisions is appropriate
• Checking your personal or super-held insurance for potential income protection or lump sum cover

An adviser can also help you prepare in advance. For those with more than one job or a variable income, income protection insurance can offer a broader and more predictable safety net. Unlike workers compensation, it can cover you across jobs and apply regardless of how or where the injury occurred.

Multiple jobs matter, but not always in the rules

Holding more than one job is common in regional towns, coastal communities and city suburbs alike. Yet despite being part of a growing economic reality, these arrangements are not always recognised fully by existing compensation systems.

If you are injured at one job and it affects your ability to work elsewhere, the financial shortfall can be substantial. And in some states, that gap is not covered at all.

If you’d like to understand how a compensation claim might affect your income or explore what cover is available to protect your situation, our team at Stream Financial is here to help.