About classification units
All employers and self-employed people working in New Zealand pay a Work levy. This money pays for supporting injuries that have been caused by work-related accidents.
Businesses pay different levy rates depending on the level of risk in their primary business activity (the risk of injury in relation to the type of work employees are doing).
After assessing a business’s risk, businesses are allocated into one of 539 classification units (CUs). The CUs are grouped into one of 142 levy risk groups (LRGs) based on injury risk profiles (the frequency and severity of injury, plus how long it takes for an injured worker to return to work - represented by the estimated total cost of claims, compared to wages paid).
ACC sets the levy rates for businesses at the LRG level. All CUs in each LRG are charged the same rate. When a CU’s risk profile no longer reflects the risk level of the LRG in which it is placed, then we look at transitioning the CU into a more suitable LRG.
We regularly review how we classify businesses and recent claims histories to ensure the CUs reflect changes in New Zealand’s business activities. We also consider feedback we have received on what we can do better.
As a result, we’re proposing changes to how we classify:
- retail and wholesale trade businesses
- professional cricket players and clubs
- prime contractors
Proposal for retail and wholesale trade businesses
Proposal for professional cricket players and clubs
Proposal for prime contractors
About credit interest
Credit interest is applied when the amount collected through provisional levies (invoices based on an estimate of the levies payable) is more than $1,000 higher than the final levy assessment.
We have held the current credit interest rate of 6% consistent for several years. However, given current low interest rates in New Zealand, this rate is no longer representative of the wider market. We’re therefore proposing to change the credit interest rate which applies to levies.
Proposal for credit interest