New South Wales could be headed for fresh industrial unrest as unions prepare to protest against controversial changes to the state’s workers compensation system.
Unions NSW, joined by the NSW Teachers Federation and the NSW Nurses and Midwives Association, will rally outside the state parliament on Monday. The protest is part of a broader campaign, with events also planned in regional areas such as Tweed Heads, Wagga Wagga, and Newcastle, aimed at halting the proposed Exposure Workers Compensation Bill.
The draft legislation, released last week, includes major reforms to the workers compensation process. One key proposal would raise the permanent impairment threshold for psychological injury compensation to 31 per cent—an increase unions argue would effectively disqualify up to 95 per cent of affected workers from making a claim.
The changes would also require court rulings before compensation could be granted for psychological injuries caused by bullying, racism, or sexual harassment. These measures have drawn criticism not just from unions, but also from some legal and industry experts.
Unions NSW Secretary Mark Morey said workers were increasingly frustrated—and now angry—that a Labor government would consider such reforms. He acknowledged the government had taken some positive steps but said these proposals were undermining its reputation.
“They’re becoming known as a government that’s constantly at odds with its workforce,” he said. “They should be supporting workers, not fighting them.”
The dispute adds to a string of recent conflicts between the Minns Labor government and unions, including a protracted and sometimes bitter standoff with the Combined Rail Unions, led by the Rail, Tram and Bus Union (RTBU). That dispute led to major disruptions across Sydney’s train network. Although the Fair Work Commission ordered a “cooling off” period earlier this year, which will expire in July 2025, tensions remain high.
Nurses and midwives, who have been campaigning over pay and hospital conditions, are also expected to participate in Monday’s rally. Thousands previously walked off the job in November.
While strikes have not been confirmed in response to the new bill, Mr Morey urged the government to withdraw the proposal and instead adopt a tripartite approach involving unions, business, and government to overhaul the system properly.
He warned that if the bill passes in its current form, many workers who would typically receive mental health support would instead be forced onto welfare or rely on family, with limited chances of returning to work due to a lack of support.
The first public hearing into the proposed reforms took place last week.
NSW Treasurer Daniel Mookhey defended the bill during his testimony, stressing that he would no longer authorise further taxpayer injections into the Treasury Managed Fund (TMF), the state’s self-insurer. He revealed the upcoming state budget would reflect a $2.6 billion writedown related to the TMF and noted the government has borrowed $6.1 billion since 2018 to cover liabilities.
“I will not approve more cash injections when that money could go to schools, hospitals, or vulnerable children,” Mr Mookhey said.
He admitted the reforms would be difficult but argued doing nothing was not an option, stating that the current system is failing both workers and businesses.
Business NSW CEO Daniel Hunter echoed concerns, saying the system is “broken.” He told the inquiry that private workers compensation premiums are rising by eight per cent annually, and the scheme lost $1.8 billion last year, despite rising premiums.
Hunter warned that without reform, some businesses could be pushed into bankruptcy, adding: “There is a human cost to this—the stress and pressure on business owners is immense.”
Asked whether the proposal was the right solution, Hunter responded bluntly: “In short, Rome is burning.”
