Proposed changes to Workers Compensation in NSW

Workers Compensation in NSW is in dire need of reform, but recent announcements from NSW Treasurer Daniel Mookhey around proposed changes will restrict how workers can access psychological injury claims at a time when mental health services are in desperate need.

Nurses and midwives will be significantly impacted by the changes as the largest group represented for having psychological injuries.

Making it almost impossible for workers to access compensation in the event of a psychological injury at work is not the way forward – this is not how a Labor government should act.

Latest update

12 December 2025

The NSW government and Liberal opposition have betrayed injured workers across NSW through a last-minute deal on workers compensation.

Under the reported deal, traumatised workers will have their weekly payments cut off after 3.5 years unless they can prove a Whole Person Impairment (WPI) above 25%, well above the current 21%, with a plan to increase that to 28% by 2029.

Note: These changes will NOT affect workers currently receiving payments.

The decision goes against repeated evidence that workers assessed above 20% are so injured they struggle with basic activities of daily living.

What happens next?

This deal by Labor and the Liberals means the Workers Compensation Legislation Amendment (Reform and Modernisation) Bill 2025 is expected to pass the Upper House when parliament resumes in February.

This isn’t a government that acts on its principles, and despite pledging to stand by injured workers at the state election, it’s choosing to abandon its essential workers who need the most support.

Once we have a full analysis of these latest changes, we will work with Unions NSW and the broader union movement to continue the fight to restore injured workers rights. In the meantime, we encourage you to contact your local Labor and Liberal MPs and hold them to account for this act of betrayal.