Victoria holds its WorkCover average premium at 1.8% for a fourth consecutive year while investing $5.8 million to help injured workers recover
Victorian employers will pay no more for WorkCover insurance in 2026–27, with the Allan Labor Government confirming the average premium will remain at 1.8 per cent – unchanged for the fourth year in a row.
Deputy Premier and Minister for WorkSafe and the TAC, Ben Carroll, announced the freeze alongside a $5.8 million investment from the Victorian Budget 2026/27 for free training and tailored support to help businesses bring injured workers back on the job.
"Labor is modernising WorkCover and passing on the benefits to workers and businesses," Carroll said. "We're improving support for injured workers without increasing costs to businesses."
The new funding will include pilot programmes targeting some of Victoria's highest-risk public sector workers – nurses, teachers and police officers – with specialised, tailored support to help them navigate recovery and return to safe, sustainable employment.
The move signals a growing recognition within government that return-to-work outcomes for frontline workers require dedicated attention, particularly as workloads and psychological pressures in these roles continue to intensify. HR leaders across the public sector will need to prepare for these pilots and ensure their organisations are positioned to partner effectively with WorkSafe in the process.
For HR professionals managing workers' compensation obligations, the premium freeze offers breathing room – but the real opportunity lies in the wraparound support now being embedded into the scheme. Businesses that proactively engage with return-to-work programmes tend to see lower long-term costs, better workforce retention, and stronger employee relations
A scheme rebuilt for sustainability
The premium freeze is the result of reforms the Labor Government introduced in 2023–24 to stabilise WorkCover after years of rising claims costs. Victoria's WorkCover claims liability had tripled since 2010, driven largely by the increased cost of weekly income support, with mental injury accounting for 16% of new claims. The scheme had required an extra $1.2 billion to offset rising costs over three consecutive financial years before the modernisation effort took hold.
Labor committed at the time that once WorkCover returned to financial sustainability, savings would be reinvested into the scheme rather than banked. The $5.8 million training and support investment represents the government making good on that promise.
Last financial year, WorkSafe provided $3.4 billion in tailored support to more than 104,000 injured workers, while helping more than 26,000 injured workers return to safe and sustainable work – figures that underscore the scale of Victoria's compensation system and the importance of effective return-to-work infrastructure for employers of all sizes.
What this means for HR leaders
For HR leaders and people managers, particularly those in the public sector, the 2026–27 announcements carry practical implications. The free training component attached to the $5.8 million investment means organisations supporting injured workers will have access to resources without adding to their cost base – a useful lever for HR teams navigating complex return-to-work cases.
It is worth noting that while the average scheme rate is frozen at 1.8%, individual premiums for Victorian employers are still shaped by factors including remuneration levels and individual claims history.
Individual premiums are also based on more than 500 specific industry rates, which are set annually based on how dangerous that particular sector has been compared with other industries in recent years.
HR leaders should review their organisation's claims profile and work closely with their WorkCover agent to understand what their renewal notice will reflect when it arrives.
The continued freeze will be welcome news for businesses already managing cost pressures, and the pairing of premium stability with expanded worker support reflects a broader ambition to make the scheme work harder – for both sides of the employment relationship.
