Scheme overhaul and anti-bullying regime supported

Source: OSH Alert (subscription service) - 7 May 2025

A peak business group has declared its support for plans to overhaul the NSW workers' compensation system to reduce psychological injury claims, calling for a scheme that "distinguishes genuine injuries from workplace disputes". Meanwhile, stakeholders have been asked to provide feedback on SafeWork NSW's proposed priorities as a standalone regulator, including harassment in the public sector and an additional hazardous substance.

Business NSW CEO Daniel Hunter said that while his organisation fully supports the rights of injured workers to "fair compensation", it backs the State Government's push for reforms because the system is being "misused".

As reported by OHS Alert in March, NSW Treasurer Daniel Mookhey flagged reducing psychological injury claim numbers and costs by, among other things: creating an anti-bullying and harassment jurisdiction within the State Industrial Relations Commission; requiring workers who believe they have been psychologically injured by bullying or harassment to pursue a claim in the IRC before they are eligible to seek workers' compensation; and making it harder for injured workers to obtain lump sum payments (see related article).

Mookhey told Parliament the new IRC system would give workers "the right to call out a psychological hazard before an injury takes place", but didn't elaborate on how the plan might apply to workers who actually sustain bullying- or harassment-related injuries.

In a statement issued this morning, Hunter said many of Business NSW's members (totalling nearly 50,000 businesses) have reported the workers' comp scheme "being used to escalate workplace grievances and performance issues".

He said one business reported that an employee lodged a psychological injury claim after attending a routine performance meeting, and was eventually awarded compensation in the Personal Injury Commission based on her "perception of being overworked".

This was despite her having, the business claimed, half the workload of her colleagues. Three years later, she remained unable to work more than 16 hours per week, pushing up its insurance premiums, it reported.

"These stories are becoming all too common," Hunter said.

He made similar comments in an opinion piece in Sydney newspaper The Daily Telegraph today, which was triggered by Mookhey yesterday briefing the Labor caucus on why he believes the workers' comp reforms are needed.

The newspaper reported that the NSW Labor Government is preparing for "an all-out assault from the union movement" on the issue.

In March, Unions NSW secretary Mark Morey said unions will engage in efforts to improve the workers' comp system, but "strongly oppose" any measures that disadvantage injured workers (see related article).

Morey said the Government needs to allow recently implemented strategies aimed at preventing psychological injuries to play out before considering major reforms, and "look inward at its own workforce practices", given the greatest increase in psychological injury claims is occurring in the public sector.

Hunter said the Government must "restore integrity and fairness to the system before it collapses under its own weight".

"This isn't about taking rights away, it's about making sure the system works for the people it was designed to protect," he said.

SafeWork plans focus on government and welding

SafeWork NSW's proposed priorities for the next financial year – its first year as a standalone regulator – include tackling work-related psychosocial risks with a "particular focus" on government workplaces, suggesting Morey's advice on this point has been heeded.

Outlined in an 11-page consultation paper, the regulator's other proposed priorities for 2025-26 include welding fumes, in addition to other hazardous substances (silica and asbestos) that are also priority issues for the current financial year.

"Welding fumes are a carcinogen, and welding is a hazardous process," the paper says.

"Research and evidence indicates that there is a lack of awareness of harms relating to welding across industry and workers and fume exposure is not being adequately controlled," it says.

Further proposed regulatory priorities for 2025-26 include falls from heights, harms to workers in the healthcare and social assistance sector, and injuries from mobile plant, vehicles and fixed machinery.

The Government urged employers, industry groups, workers and unions to comment on the proposals (by 25 May), saying the feedback will inform the next Annual Regulatory Statement for SafeWork.

SafeWork was established as a standalone executive agency – excised from the State Department of Customer Service – under an Amendment Bill that passed Parliament in March (see related article), and takes effect on 1 July.

The changes are aimed at ensuring SafeWork targets more PCBUs and is widely perceived as the "cop on the beat".

Referring to this development, the new consultation paper says work is "underway on a comprehensive reform program to embed best-practice approaches and transform SafeWork NSW into a strong, responsive, and accessible regulator".

In the meantime, SafeWork will "continue to take a firm stance to address high priority issues, working with industry, unions, workers and their representatives to secure compliance with work health and safety laws", it says.