The NSW Treasurer, Hon. Daniel Mookhey, has issued this Ministerial Statement to the NSW Parliament, warning that the current workers compensation scheme is unsustainable without significant reform in the management of workplace psychological injuries.
The Treasurer shared the following statistics:
- In the last 6 years, the number of claims for psychological injuries had doubled, whereas all other injuries had grown by 16%.
- Psychological injuries are 12% of total claims in NSW but represent 38% of the total cost.
- The average cost of a psychological injury has almost doubled from $146,000 in 2019-2020, to $288,542 in 2024-2025
- Unless the system were to change, it is forecasted that employers, who are facing no claims against them, are likely to expect premiums to rise by upwards of 36% over the next 3 years.
The model proposed to parliament would increase barriers to injured workers receiving compensation for workplace psychological injuries.
For claims relating to psychological injuries caused by bullying and harassment, it was proposed that injured workers must first have their claims heard by the NSW Industrial Relations Committee (IRC) before making a claim for compensation. Furthermore, the Treasurer also proposed that the NSW whole person impairment be re-aligned, to match the systems in South Australia and Queensland. The Australian Lawyers Alliance (ALA) has described this as an “imminent threat to the rights and entitlements of thousands of workers reporting psychological injury in the workplace.”
We agree with the ALA. Rather than stamping out tens of millions of dollars lost in rejecting and delaying claims, the NSW Parliament suggests that it should be injured workers who shoulder the brunt of the problem, further alienating and undermining an already vulnerable class of workers trying to do their very best to survive an already stressful and shambolic system.
We hereby call on the NSW Parliament to broaden its inquiry to include millions in State funds lost through bewildering bureaucracy and patent case management blunders. Icare and its agents are often the subject of SIRA and IRO complaints by workers and their representatives, particularly in relation to poorly communicated and illogical case management and liability decisions, sometimes unlawful and/or in breach of the Standards of Practice. Put simply, so long as the workers compensation scheme remains an adversarial one, millions in State funding will be lost each year fighting claims which are ultimately successful including claims which were logically always more likely to be successful than not.
We call on the NSW Treasurer to disclose the “steps taken to rein in [icare’s] spending”. We further call on the NSW Parliament to properly consult with the ALA and all IRO Approved Lawyers before making any decision to further restrict and strip away workers’ rights and entitlements.
DISCLAIMER
This article reflects the current law at the time of publication. It is intended for informational purposes only and does not constitute legal advice. The actual decisions in each case are summarised for general understanding. For specific legal guidance in relation to your situation, please consult with a qualified legal professional.
