NSW government announces new workers' compensation measures, amid union criticism

Australia Broadcast Center

27-05-2025

The New South Wales government has announced a series of measures aimed at softening its major overhaul of workers' compensation, after a fierce backlash from unions and concerns raised by medical professionals and lawyers.
But the planned legislation, which is being introduced to parliament on Tuesday, will still make it significantly harder for workers to claim long-term compensation for psychological injuries, including post-traumatic stress disorder.
Under changes announced today, the government has dropped plans to force workers to go to the industrial relations commission to prove they have suffered a psychological injury before they can lodge a compensation claim.
That measure will be replaced by an eight-week accelerated process for psychological injuries caused by bullying, harassment or excessive work demands.
NSW Treasurer Daniel Mookhey said it would mean workers would be able to receive a partial payment while the claim was determined while still making the scheme more sustainable.
"The introduction of a fast-tracked assessment process for bullying and harassment fundamentally resolves the problem that is plaguing the current system, which is that ….this category of claim is taking disproportionately longer than any others," Mr Mookhey said.
The Industrial Relations Commission (IRC) will have the power to issue stop-bullying orders and enforce remedies ranging from a public apology to damages of up to $100,000.
But the government is sticking with another of the most controversial elements of the bill.
The planned legislation will require people to prove a 30 per cent whole-of-person impairment if they are seeking support more than two and a half years after a psychological injury.
It's a dramatic increase of the current threshold which is 15 per cent, and one that was widely condemned by experts in a snap parliamentary inquiry that was held into the changes.
Unions and psychiatrists have claimed the threshold is too high — with some saying it would prevent 99 per cent of people who are still psychologically able to function at work from receiving compensation.
In a small concession to that opposition the government will now phase in the changes between now and July next year.
Mr Mookhey defended the benchmark.
"The reason why is because every state now that have comparable systems to NSW have already made that change and used that threshold," Mr Mookhey said.
"I should also stress that NSW is the only jurisdiction in Australia that offers lifetime support above that 30 per cent."
It's not yet clear whether the changes will be enough to gain enough support for the government to pass the bill, which has been broadly criticised by the Opposition and crossbenchers, through parliament.
Mr Mookhey said the legislation was necessary to ensure people could access workers' compensation.
""Of course I expect that there will still be people opposed to these reforms and I respect their right to do so," he said.
"The question now for parliament is are these reforms worse than the status quo and the status quo is failing and doing nothing is not an option."