Overview
Cash payment is not the legal test
A cash-paid worker may still have a NSW workers compensation claim. The payment method does not remove the need to prove the legal work relationship, a compensable injury and any claimed loss of earnings.
These are separate questions. Strong evidence about cash wages does not by itself prove worker status or work causation. Equally, missing payslips do not by themselves prove that no employment or earnings existed.
Separate the claim into three questions
Were you a worker?
Identify the contract or arrangement under which the work was performed and whether the statutory worker definition or a Schedule 1 category applies.
Is the injury compensable?
Record the incident or work process, medical history, notice to the employer and evidence connecting the injury with the employment.
What earnings can be proved?
Reconstruct the earning period and earnings inputs used for PIAWE, then distinguish the weekly-rate issue from liability and capacity disputes.
Worker status depends on the legal relationship
Section 4 of the 1998 Act defines a worker as a person who has entered into or works under a contract of service or a training contract. The contract can be express or implied, oral or written. Schedule 1 of the 1987 Act also extends worker status to specified classes in particular circumstances.
A business name, ABN, invoice, contractor label or cash envelope may be relevant evidence, but no one item supplies a universal answer. Where the arrangement was not written, the parties' communications and conduct may help establish the agreed rights and obligations. Worker status can also involve exclusions, deemed-worker provisions or principal liability, so it should not be reduced to a checklist score.
- Any written agreement, onboarding form, invoice or payment note.
- Messages about rates, shifts, attendance, leave, substitutions and instructions.
- Who supplied tools, equipment, transport, materials and insurance.
- How work was allocated, supervised, corrected and paid.
- Whether the person could delegate the work and whether they operated an independent business.
- Induction records, uniforms, site access, job sheets and witness evidence.
These facts are evidence, not a mechanical statutory checklist. The legal character of the relationship must be assessed in context.
Prove the injury separately from the pay arrangement
The injury evidence should identify what work was being done, the time and place, the mechanism of injury and when symptoms were first reported. A later dispute about cash wages should not obscure the medical and factual evidence about the injury itself.
- A dated written report to the employer or person directing the work.
- A Certificate of Capacity and contemporaneous GP or hospital notes.
- Photos, CCTV preservation requests, job records and site access logs.
- Names and contact details of witnesses, supervisors and co-workers.
- A short chronology that distinguishes direct knowledge from later recollection.
Reconstruct PIAWE using records that can be tested
PIAWE is calculated under Schedule 3 and the current Workers Compensation Guidelines. For current non-exempt claims, the relevant earning period is generally the 52 weeks immediately before injury, but the period can be adjusted for matters such as shorter employment, unpaid leave or a permanent change in earnings. Concurrent jobs and particular earnings categories have their own rules.
Where payroll records are missing, collect independent records and make them consistent. A schedule showing each date, shift, hours, rate, amount and supporting source is more useful than an unsupported weekly average. The insurer should still explain the statutory calculation it adopts.
- Bank deposits or withdrawals linked to payment dates.
- Messages confirming rates, hours, shifts or amounts paid.
- Rosters, calendars, timesheets, delivery records or job sheets.
- Tax, accounting, superannuation or business records where available.
- Witness evidence from people with direct knowledge of hours or payments.
- Records for every concurrent job held at the injury date.
If the employer is uninsured or cannot be identified
A refusal to provide policy details does not establish that no policy exists. Section 161 allows a written request to inspect the policy that was in force for the worker when the injury occurred.
Division 6 of Part 4 of the 1987 Act permits a claim against the Nominal Insurer where the employer was uninsured, or where the relevant employer cannot be identified after due search and inquiry. The Division contains qualifications, including possible liability of a principal, and the claim must use the form and manner determined by the Nominal Insurer. The exact employer and contracting structure should therefore be checked before choosing this route.
Read the insurer decision by issue
A liability decision, a worker-status dispute, a PIAWE decision and a later work-capacity decision are not interchangeable. A section 78 notice disputing liability must give understandable reasons and identify the legislation relied on. A request for insurer review under section 287A is optional and must be decided within 14 days, provided it is made before referral to the Personal Injury Commission.
For a PIAWE decision made on or after 1 July 2026, PIAWE is not a section 43 work capacity decision. SIRA states that a worker may request an optional insurer review or lodge a PIAWE dispute directly with the Commission. Match the evidence and procedure to the decision actually made.
Documents to send for an initial review
- The claim form, section 78 notice or PIAWE decision and calculation.
- Current Certificates of Capacity and the first clinical notes after injury.
- Any contract, messages, rosters, invoices and work-allocation records.
- A dated earnings schedule with a source for each entry.
- The written request for policy details and the employer's response.
- A concise chronology of the work arrangement, injury and payments.
Keep originals and provide copies. Do not alter screenshots, reconstruct messages or ask a witness to confirm facts they did not observe.
Frequently asked questions
Can I claim workers compensation if I was paid cash?
Possibly. Cash payment does not by itself decide whether you are a worker or whether the injury is compensable. The contract or working arrangement, the injury circumstances and the available evidence must be assessed under the NSW legislation.
Does being called a contractor decide my claim?
No single label decides worker status. The statutory definition covers a person working under a contract of service or training contract, including an oral or implied contract, and Schedule 1 also treats some people as workers. The contract and the relationship as a whole need to be examined.
How can PIAWE be calculated without payslips?
Schedule 3 still governs the calculation. Bank entries, rosters, messages about rates and shifts, tax or accounting records, invoices, diaries and employer records may help establish the earning pattern. The evidence must be reconciled to the statutory earning period and earnings categories rather than simply averaged informally.
What if the employer denies that I worked there?
Preserve records showing the work arrangement and attendance, such as messages, rosters, site access, induction material, job sheets, location records and witness details. Medical notes and the written injury report should accurately identify when, where and how the injury occurred.
What if the employer will not identify the insurer?
Section 161 permits an injured worker to require the employer in writing to make the relevant policy available for inspection. If the employer was uninsured, or the relevant employer cannot be identified after due search and inquiry, section 140 provides a claim pathway against the Nominal Insurer, subject to the statutory conditions and any possible principal liability.
Do tax or record-keeping problems decide worker status?
Not by themselves. Tax, superannuation and record-keeping issues may need separate advice, but the workers compensation question is determined under the NSW worker definition and the applicable claim provisions. Do not assume that undeclared income either proves or defeats a claim.
What if the insurer accepts the injury but uses the wrong weekly rate?
Obtain the written PIAWE decision and calculation. Identify the earning period, each amount included or excluded and the evidence supporting the correction. A PIAWE decision made on or after 1 July 2026 can be reviewed by the insurer on request or disputed directly in the Personal Injury Commission; the insurer review is optional.
Related NSW workers compensation guides
Need the worker-status or weekly-rate decision checked?
Send the insurer decision, Certificates of Capacity, work-arrangement records and the clearest available earnings records. We can identify which issue is actually disputed and explain the available procedure. ILARS funding may be available for an eligible worker and issue, subject to an approved grant.
This information is general in nature and is not legal advice. You should obtain advice about your own circumstances.