Minister Judith Collins admits ACC staff are given bonuses for getting long-term claimants off the books.
Green Party ACC spokesperson Kevin Hague said documents released under the Official Information Act show that ACC staff working with people receiving long-term claim payments have specific targets they have to achieve.
"ACC staff are paid a flat rate which can go up or down
depending on how they perform," Hague said.
"It is completely unacceptable that one of the performance mechanisms for ACC staff receiving pay is how many claimants are cut off from receiving their entitlements."
Collins told Parliament it was about getting people back to work.
"If the member [Hague] wants to look at it like that, I can understand why he would be concerned," Collins said.
"But if he can look at it another way, which is a financial incentive to help people get back independence and back to work, I'd say that was probably a good thing."
Hague said it was inevitable some claimants will have financial
support withdrawn before it is clinically appropriate in some
"It is also important to note that staff failing to meet ACC's self-imposed targets to move claimants off ACC may be penalised financially," Hague said.
"ACC needs to return back to being an organisation that focuses on prioritising claimants needs."
Hague said the scheme was "symptomatic of a sick culture" within ACC.