Proposed changes to Workers Compensation in NSW

On 18 March 2025, NSW Treasurer Daniel Mookhey announced the NSW government is considering changing how the NSW Workers Compensation system handles psychological injury claims.

In collaboration with Unions NSW, the Association has begun consultation with the state government to better understand their proposal and the potential impact on nurses, midwives and carers.

The proposed changes of concern are:

• Workers who experience work-related bullying will be required to undertake legal proceedings at the NSW Industrial Relations Commission or the Fair Work Commission before being able to access workers compensation.
• A new legal definition of psychological injury and what constitutes reasonable action by your manager, which could restrict access to workers compensation and shift more power towards employers.  Specifically, itwill exclude claims for psychological injury from excessive workloads – one of the most common factors for nurses and midwives submitting claims.
• Introduce a higher threshold for how injured a worker must be to access income replacement payments after 2.5 years – doubling the percentage of whole person impairment that you would be required to prove.

We know nurses and midwives will be impacted significantly by the proposed changes, as the largest group represented for having psychological injuries. The most common cause of psychological injury at work for nurses and midwives is workplace bullying, or assault.

While we agree workers compensation insurance in NSW does need reform, the government’s proposal is of significant concern for nurses, midwives, carers and future generations. The government’s proposed changes will restrict workers’ access to compensation in the event of a psychological injury.

In a time when workers’ mental health and wellbeing have never been more important, the NSW government should be prioritising mental health support not cutting it.

The Association will continue working with other unions to resist these changes and position  NSW as  a leader in workplace safety with a worker compensation system that keeps workers safe. Together we’ve made a number of recommendations to the state government about positive reform to workers’ compensation.

NSW government MPs and Members of the Legislative Council (MLCs) signed a pledge promising to reform the workers compensation system when they got into government.

These same MPs and MLCs are now supporting these cuts and turning their backs on injured workers.

Send an email to your local Labor MP and MLCs and tell them to stand by their pre-election promise to support injured workers. Click here to take action.

We also want to hear from you to understand better the proposed reform’s impact on nurses, midwives and carers. This will also help inform our priorities while we undergo engagement with the government.

Share your feedback in this short survey.

These proposed reforms fall short of addressing the underlying problems in our health system.

As healthcare professionals, we know prevention is key to reducing the risk of poor health or illness. The government must do better.