Today in Parliament, Abigail gave an adjournment speech about NSW Labor’s cruel and dangerous proposal to rip away critical workers compensation entitlements for workers who suffer a psychological injury at work.
Abigail said:
In an abrupt and shocking about face, the New South Wales Minns Labor Government—after years of campaigning and pledging to protect and bolster the rights of injured workers—now intends to take a sledgehammer to workers compensation entitlements. That will mean that employers, including the Government itself as Australia's largest employer, will benefit from reduced obligations towards their workers by denying compensation entitlements to thousands of injured and traumatised workers. The changes are ill‑conceived, ignorant, callous and dangerous. Without being dramatic or hyperbolic, if allowed to proceed, people will die.
The New South Wales Labor Government is targeting workers suffering a specific type of injury: a psychological injury. But the Government's claim that there is some explosion in psychological injury claims and that it puts an impossible burden on the workers compensation scheme just does not add up, particularly not when it comes to employers other than the Government. Psychological injury claims made up 5 per cent of workers compensation claims in the Nominal Insurer in 2015‑16, and make up 7 per cent of claims today. From 2021‑22 to 2023‑24, total claims for the Nominal Insurer increased by an additional 10,100 claims, but 80 per cent of that increase was for non‑psychological claims. The Treasurer has claimed that an additional 80,000 psychological injury claims are expected in the next five years, but that assertion is plainly absurd when you look at the modelling provided and this year's data so far. The Treasurer and the Premier are tying themselves in knots trying to make the case that callously cutting off entitlements for workers injured at work is somehow necessary to keep premiums manageable.
So what is really going on? Is it perhaps that the Government itself is presiding over the most psychologically unsafe workplaces in the State? For government employees, the increase in psychological claims certainly has become more pronounced, representing an increase from 13 per cent of claims in 2015‑16 to 20 per cent of claims today. The fact that it is the Treasurer spearheading the change when the workers compensation Acts are actually the shared responsibility of the Minister for Work Health and Safety and the Minister for Customer Service and Digital Government should tell us everything we need to know about the Government's proposals. It has nothing to do with the proper functioning of the scheme and everything to do with the New South Wales Government's own budget bottom line.
The Government is seeking to create a definition of psychological injury that will create an extremely high barrier for entry for compensation—markedly higher than what currently exists and totally distinct to the regime that operates for physical injuries. The current definition of an injury under workers compensation law does not distinguish between physical and psychological injuries; the only test is whether or not an injury has occurred in the workplace and whether compensation or assistance to recover is required. Entitlements for long-term care and support face being massively, dramatically and arbitrarily curtailed for workers who have been deemed to be seriously and permanently psychologically injured in the workplace. In the eyes of lawyers, psychiatric specialists, unions and other advocates, the Government's 31 per cent threshold sets an almost impermissibly high barrier to entry to access entitlements that exist for all other types of injury.
The message is clear: The Government considers psychological injuries to be inherently less legitimate and less deserving of support. Gallingly, the Government is also embedding an inherent suspicion in the legitimacy of sexual and racial harassment claims, alongside bullying and excessive work demand claims. Under the Government's proposed changes, a successful claim for racial or sexual harassment will still incur a financial penalty to the claimant, who will not receive their full weekly payments. Hidden in the detail is also the extraordinary step of requiring injured workers to pay for their own legal costs to pursue a workers compensation claim in a situation where they are unrecoverable even if successful.
Despite the rhetoric that the bill is only about psychological injuries, the Government is proposing to create a new test for access to medical and related costs that is harsher than that seen in any other workers compensation jurisdiction on mainland Australia. The change to "reasonable and necessary" has been described by the Independent Review Office as a significantly more demanding test than the current test, and will affect physical and psychological claims, and impact every category of worker, including those otherwise excluded workers such as police, firefighters and paramedics. The changes will apply retrospectively for claims already in the system. Like other aspects of the proposals, they serve no conceivable preventative purpose.
The Treasurer's claim of modernising the scheme is a self-serving piece of Orwellian doublespeak. What is in fact happening is not a modernisation of anything; it is instead a reactionary step that will take workplace protections, and the painstaking work towards destigmatisation of mental health, backwards by decades, and is in direct contradiction to recent changes to national work health and safety laws that recognise the potential for psychological harm and injury that can arise in the workplace. Workers compensation is a lifeboat for injured workers. We have identified that the lifeboat has sprung plenty of leaks, but the Government's plan to stop the sinking is to throw certain workers overboard. It is an act of unimaginable cruelty and callousness. If it is to pass, there will be blood on Government members' hands.
Read the transcript in Hansard here.
29 May 2025