The Industrial Relations and Other Legislation Amendment (Workplace Protections) Bill 2025 (the Bill), introduced by the New South Wales Government on 27 May 2025, and passed on 27 June 2025, proposes substantive amendments to the State’s industrial relations and work health and safety framework. The Bill will implement targeted and wide-ranging reforms to the Work Health and Safety Act 2011 (NSW) (WHS Act), the Industrial Relations Act 1996 (NSW) (IR Act), and the Industrial Relations (General) Regulation 2020 (IR Regulations). This comes as part of a wave of reforms following the Minns Labor Government’s pledge of a $344 million Workplace Mental Health Package.
The passing of the Bill follows the re-establishment of the Industrial Court of New South Wales as a “one-stop shop” for workplace matters in NSW on 1 July 2024, which handed down its first sentence the following month in the case of SafeWork NSW v Hibernian Contracting Pty Ltd [2025]1 (see our article linked here). The Bill also confers new jurisdiction on the Industrial Relations Commission (IRC) to conciliate, arbitrate, and make orders in relation to workplace bullying and sexual harassment to protect employees that are not captured by the federal workplace relations system under the Fair Work Act 2009 (Cth) (FWA). The amendments apply to employees in the New South Wales public sector, local government sector, and workers employed by unincorporated entities.
Key takeaways for employers
- The IRC can now award compensation of up to $100,000 and issue binding orders in workplace bullying and sexual harassment matters:
- Employers may be held vicariously liable for sexual harassment by employees or agents unless they can demonstrate that all reasonable steps were taken to prevent the conduct.
- Employers must comply with WHS codes of practice or implement alternative measures that provide an equal or higher level of health and safety protection, as a new enforceable duty.
- Courts will have discretion to extend the two-year limitation period for WHS prosecutions where it is in the interests of justice, including in cases involving delayed-onset illnesses such as silicosis.
- The IRC is now empowered to resolve WHS disputes, replacing the previous inspector-led process, and unions are granted standing to initiate or participate in these proceedings.
- The IRC may issue binding directions during conciliation and impose civil penalties of up to $25,000 for non-compliance with arbitrated outcomes.
- The small claims threshold under the IR Regulations will increase from $10,000 to $100,000.
Changes to the WHS Act
Codes of Practice
The Bill introduces section 26A into the WHS Act, which creates a duty for a person conducting a business or undertaking (PCBU) to either comply with an approved code of practice or to manage hazards and risks arising from work carried out as part of their business or undertaking in a way that achieves an equivalent or higher standard of health and safety required under the code. This reform brings New South Wales into alignment with Queensland, which enacted similar provisions in 2018.
Currently, in most harmonised jurisdictions, codes of practice do not impose standalone duties or attract penalties. They serve as admissible evidence of what is known or reasonably foreseeable to a PCBU in managing risks. The proposed amendment requires a PCBU to strictly demonstrate that any alternative measures implemented, achieve a threshold that is equivalent to, or higher than, that prescribed by the relevant code of practice.
Need to know:
- There are currently 30 WHS approved NSW codes of practice in force.2
- Codes of practice are accessible on the SafeWork NSW website.
What employers need to do next:
- Understand all applicable codes of practice relevant to your organisation and review existing controls, policies and procedures to ensure alignment (particularly where codes of practice are prescriptive or step-by-step in nature).
- Consult with your employees and relevant parties on any changes or identified risks.
- Maintain clear records of risk assessments, reviews, and any resulting actions.
Limitation periods
The Bill introduces a judicial discretion to extend the statutory limitation period under section 232(1)(a) of the WHS Act, which otherwise bars prosecutions to occur more than two years after an offence “first comes to the notice of the regulator”. This amendment (alongside others) responds directly to the decision of the NSW Court of Criminal Appeal in Prime Marble & Granite Pty Ltd v SafeWork NSW [2024]3, in which the Court held that the limitation period commenced when SafeWork NSW first became aware of the risk rather than when the consequential fatalities occurred. The prosecution had been initiated in 2023, following the 2020 deaths of two former workers from silicosis. However, the Court held that SafeWork had sufficient information in 2017 and 2018 to form a reasonable belief that an offence under section 32 had been committed. As a result, the proceedings were out of time and dismissed as statute barred.
The proposed reforms permit the court to allow proceedings to be brought out of time where it is in the “interests of justice”. As explained by Minister Sophie Cotsis in her first reading speech, this is intended to address “situations in which there is delayed onset of injury or illness, such as in the case of some dust diseases, following a worker’s exposure to a risk of harm”.
Notification requirements
The WHS Act previously contained no obligation for a PCBU to notify the regulator upon receipt of a Provisional Improvement Notice (PIN) issued by a health and safety representative (HSR). The insertion of section 97A of the WHS Act establishes a new requirement for the PCBU to provide the regulator with a copy of the PIN as soon as practicable, with a maximum penalty of 50 penalty units for non-compliance.
Resolution process
| Area | Position in Current Act | Changes under the Bill |
| Escalation of a dispute | Disputes could be escalated to the regulator (s 82)
Inspectors could be appointed to assist in resolution (s 82(2)) |
Parties may notify the Industrial Registrar of a dispute. Jurisdiction is conferred on the IRC to deal with the dispute under section 102C. |
| Who can refer a dispute | A PCBU, worker, health and safety representative | A PCBU, worker, health and safety representative, or relevant union may notify the Industrial Registrar of a dispute concerning a defined “WHS matter” (s 102A) |
| Scope of disputes | No defined list | Applies to disputes about a defined “WHS matter” including:
|
| Inspector involvement | Indefinitely (subject to resolution) | Section 102D prohibits inspector involvement once a dispute has been notified to the IRC, unless the IRC orders otherwise.
Existing inspector involvement must also cease |
| Avenues of dispute resolution | Resolved informally between the parties or with assistance of an inspector | The IRC may resolve the dispute through mediation, conciliation, or arbitration, with powers to make binding orders (s 102E(2)) |
Union powers expanded
The Bill marks an expansion of union powers under the WHS Act. Unions are now conferred standing to initiate and participate in work health and safety disputes before the IRC, in respect of a broad range of defined WHS matters (see ‘scope of disputes’ above).
Where not originally named as a party, a union may elect to participate by notice and will be treated as a party to the proceedings. In parallel, the powers of union officials exercising right of entry have been substantively broadened, with the amendments now authorising the collection of evidence by way of measurements, testing, and audiovisual recordings, following long-standing concerns regarding evidentiary constraints in complex or high-risk work environments. The reforms also confer expanded rights of review, enabling unions representing affected workers to challenge a wider array of regulatory decisions. Notably, the Bill simplifies the pathway for union-led prosecutions, removing prior statutory barriers including the requirement for Director of Public Prosecutions involvement and permitting unions to prosecute any offence under the WHS Act following consultation with the regulator.
Industrial Relations Act 2011
Workplace bullying
The introduction of Chapter 3A, Part 1 into the IR Act creates a dedicated jurisdiction for the IRC to hear and determine workplace bullying complaints. While the statutory definition of bullying mirrors that contained in the FWA, the obligations imposed on employers under the NSW regime are considerably more onerous.
Although the NSW provisions do not apply to employers regulated under the national system, they apply to public sector bodies, local councils, and unincorporated entities. These employers are now subject to more prescriptive obligations in managing workplace conduct, complaints, and investigations, as well as more significant legal and reputational risks for non-compliance.
Remedies
The IRC must attempt to resolve the matter through conciliation before moving to arbitration. Where bullying is substantiated, the IRC can issue orders to stop the conduct and may award compensation to an affected employee, capped at $100,000 (s 144G).
This significantly exceeds the scope of the FWA, where the Fair Work Commission (FWC) may only issue non-compensatory orders and has no power to award payment of damages. For employers, this represents a material increase in financial exposure in respect of bullying claims.
Enforcement
Non-compliance with an order exposes employers to civil penalties of up to $93,900 for corporate entities and $18,870 for individuals (s 144H). These are new obligations that do not exist under the federal bullying jurisdiction, making the NSW scheme considerably more demanding from an enforcement perspective.
Sexual harassment
Chapter 3A, Part 2 establishes a new jurisdiction within the IRC to address sexual harassment in connection with work. While the legislative definition aligns with that in the Sex Discrimination Act 1984 (Cth) (s 144L), the proposed NSW framework introduces a more prescriptive and structured approach to the resolution of sexual harassment complaints.
Procedural Requirements
Unlike the FWA, which generally requires parties to pursue separate court action if mediation fails, the NSW regime mandates that the IRC attempt conciliation in the first instance (s 144R), followed by arbitration where necessary (s 144S). Employers may be required to participate in both stages, and to implement binding orders made as part of the resolution process. This streamlines what would otherwise involve multiple forums at the federal level.
Compensation and Penalties
The IRC can issue a wide range of orders to stop or prevent the harassment and award compensation of up to $100,000. Breaches of these orders can also attract civil penalties in line with those available for bullying.
Vicarious Liability
Proposed section 144O introduces vicarious liability for employers and principals where an employee or agent engages in sexual harassment in connection with their employment or agency duties. Liability will be imposed unless the employer can demonstrate that all reasonable steps were taken to prevent the conduct.
Procedural and enforcement powers
The reforms also extend the IRC’s general dispute resolution powers:
- The IRC is now authorised to issue directions or make recommendations during conciliation, even if a party does not consent. Where a party does not comply, written justification must be provided.
- The IRC may also determine matters involving the interpretation or application of industrial instruments during arbitration. Breaching these determinations may result in a $25,000 penalty.
Freedom of association
Chapter 7, Part 6, Division 2 of the Bill reinstates the reverse onus of proof for proceedings concerning alleged victimisation of an employee or prospective employee. However, the reform departs from prior interpretations by introducing a revised, objective test. The IRC must now be satisfied, objectively, that the alleged proscribed reason – such as engaging in lawful industrial activity or asserting a workplace right – was not a substantial and operative cause of the employer’s conduct.
The explanatory note clarifies that this amendment responds directly to the High Court’s decision in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012]4, which interpreted similar provisions under the FWA. The Bill aligns instead with the broader approach taken by the majority of the Full Federal Court in Barclay v The Board of Bendigo TAFE [2011]5, notably that “the proposed amendment clarifies that the reasoning of the majority of the Full Federal Court… is the preferred test when determining if the presumption has been rebutted”.
Under this approach, the IRC may consider both conscious and unconscious motivations and need not rely solely on direct evidence of intent. For employers, this significantly elevates the threshold required to rebut a presumption of unlawful motive.
Implications for employers
The NSW reforms introduce more onerous obligations on employers compared to those that apply to employers operating under the federal regime, both substantively and procedurally. Employers falling within the scope of the NSW industrial relations system must now contend with:
- Binding financial remedies for bullying and harassment;
- Civil penalties for non-compliance;
- Greater exposure to conciliation and arbitration processes; and
- Heightened evidentiary requirements to rely on reasonable management action or avoid vicarious liability.
In practical terms, these reforms demand a renewed focus on workplace conduct policies, training, early intervention procedures, and documentation. Employers who fail to meet these heightened standards may face not only legal consequences, but also significant reputational damage.
IR Regulations
The Bill amends the IR Regulations to support the expanded enforcement framework. Key changes include:
- Raising the small claims threshold from $10,000 to $100,000, removing the previous cap and allowing higher-value disputes to be dealt with under the simplified small claims process.
- Introducing new civil penalty provisions to reflect the Bill’s expanded coverage of bullying, sexual harassment, and victimisation.
These changes are designed to improve access to enforcement and streamline claims. Employers should be aware that larger claims may now be pursued through faster, lower-cost small claims proceedings.
For more information on the likely impact of these regulatory changes, please contact Michael Tooma or Roxanne Fisch of our Workplace and Safety team.
1NSWIC 4.
2As of 1 July 2025.
3NSWCCA 105.
4HCA 32.
5FCAFC 14.
