Workers Compensation Exposure Draft released

NSW Treasurer Daniel Mookhey has referred the Exposure Draft to a parliamentary inquiry to further examine and seek feedback on reform options.

Rounds of formal consultation began in March and an Exposure Draft’s release marks the next step in that process.

The NSW Government is committed to modernising the workers compensation system to ensure it is sustainable for future generations to rely on.

Reform proposals recognise that workplace health and safety and workers compensation laws are failing to both prevent psychological injuries and to treat those with psychological injuries quickly.

Under the current system, only 50 per cent of workers with a psychological injury are returning to work within a year. The rate is 95 per cent for workers with a physical injury.

And the system currently spends seven times more on keeping an injured worker away from the workplace than it spends on getting them healthy and back on the job.

NSW must have workplace health and safety laws, and a workers compensation system, that put prevention ahead of compensation as a response to psychological safety.

The status quo is failing workers and failing employers, who face premiums soaring by a forecast 36 per cent over the next three years if nothing is done.

The Government will not be adopting a final position on workers compensation reform until the community has had a chance to have its say. This Exposure Draft is intended to provide a starting point for the next phase of conversations and to highlight the scale of the challenges the scheme is facing.

The Standing Committee on Law and Justice in the Legislative Council will hold the inquiry.

Treasurer Daniel Mookhey said:

“We must ensure that NSW has a workers compensation system for future generations to rely upon.

“The status quo is failing workers and it’s failing businesses.

“I encourage people to read the Exposure Draft for themselves and examine proposals to protect this system.”

Minister for Industrial Relations Sophie Cotsis said:

“The Minns Labor Government is committed to strengthening a culture of prevention, early intervention, and effective return to work through a series of reforms.

“These include major reforms to SafeWork NSW, such as expanding the psychosocial inspectorate, and industrial relations reforms that establish a 'stop bullying' jurisdiction.

“Additionally, we have amended the iCare Act to include a principal objective focused on promoting early and appropriate treatment and care for injury and illness. This aims to optimise recovery, support return to work and daily activities, and ensure a sustainable compensation system."

Minister for Customer Service and Digital Government Jihad Dib said:

“The current system was primarily designed to support people who suffered a physical injury at work; it doesn’t do enough to help people experiencing psychological injury to recover and return to work.

"We welcome feedback on these proposals aimed at modernising the system and supporting people with serious injury.”