Important changes to workers' compensation in NSW

by 16 Jul 2012

Following the passing of the Workers Compensation Legislation Amendment Bill 2012, the landscape of workers’ compensation in New South Wales has significantly changed. The new laws change the way workers’ compensation benefits claims are assessed and paid, and will affect the majority of all new and existing workers’ compensation claims.

The changes are a significant win for employers, as the former scheme was suffering a $4.1bn deficit, and had it continued, employer premiums would have immediately increased by as much as 28%. While the majority of changes have already come into effect, some of the changes will be phased in over the next 12 to 18 months.

Return to work obligations – important changes

  • The changes mean a worker who is able to work must, in co-operation with the employer or insurer, make reasonable efforts to return to work in suitable employment, and may request their employer to provide such suitable employment.
  • The employer must comply with this request so far as it is practicable.
  • WorkCover inspectors are now authorised to issue employer ‘Improvement Notices’ if they believe the employer is not meeting their obligations in this regard.
  • In addition, it is an offence for the employer if they fail to meet their obligations, subject to a penalty of up to $11,000. If a worker who is able to work fails to make reasonable efforts to do so, he or she may have their weekly payments suspended or – in extreme cases - terminated.

Other key features of the transitional arrangements include:

  • Seriously injured workers who have been receiving long-term weekly benefits and whose whole person impairment is more than 30% can move from $432.50 per week, to the transitional rate of $725. WorkCover is taking steps to apply the new benefits to these workers as soon as practicable.
  • During the first 26 weeks of incapacity payments, the amount paid will be the same as under the existing rules;
  • Claimants who have already received 26 weeks of payments and have an ongoing entitlement will be paid according to the transitional rate that is significantly more than the current basic statutory rate of payment; and
  • The existing weekly payment rules will continue to apply until the person has undergone an individual work capacity assessment. Due to the large number of people receiving payments, it may take more than 12 months for all existing claimants to undergo work capacity assessment.
  • Workers will be given three months’ notice of any changes to their weekly benefits due to the new laws. The most seriously injured workers will not be subject to work capacity assessments unless they wish to have one.

For further information on the changes, visit the NSW workers compensation fact sheet available here or visit

*Stay tuned to HC – tomorrow we reveal 10 expert tips on how to improve your workers compensation claims outcomes


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