The NSW Government has now introduced major industrial relations and work health and safety reforms.
On Friday 27 June 2025, the Industrial Relations and Other Legislation Amendment (Workplace Protections) Bill 2025 (NSW) (Bill) passed both houses of parliament and will amend the Industrial Relations Act 1996 (NSW) (IR Act) and the Work Health and Safety Act 2011 (NSW) (WHS Act).
The amendments for the IR Act are specific to all state and local government employers.
According to the NSW Government, the Bill is aimed at modernising workplace protections, improving gender equality outcomes and strengthening the jurisdiction of the Industrial Relations Commission (IRC) in addressing critical issues, such as sexual harassment and bullying.[1] The Bill is part of, and complements, the proposed reforms separately introduced for the state’s workers compensation system under the Workers Compensation Legislation Amendment Bill 2025 (NSW).
The changes in the Bill are important and potentially far-reaching.
Changes to the IR Act
Described by the Minister for Industrial Relations and Work Health and Safety, Sophie Cotsis, as “critical measures,” the changes focus on five key areas:
- gender equality;
- protections relating to the freedom of association and victimisation;
- prohibition of sexual harassment;
- stopping bullying and sexual harassment; and
- the IRC’s powers in resolving industrial disputes.
New “objects” for the IR Act
The objects of the IR Act will be amended to ensure there is a greater focus on achieving “gender equality”, as opposed to just “equal remuneration”, and in “preventing and eliminating discrimination, bullying and sexual harassment in the workplace”.
These new objects are reflected in the other changes to the IR Act and will be a consideration of the IRC in the way that it determines any matters before it.
Industrial disputes – arbitration orders, recommendations and directions
The IRC has always had powers to issue recommendations and directions in dealing with industrial disputes. Now, the changes clarify that such recommendations and directions are not subject to, or are to be swayed by, the interests or attitudes of the disputing parties.
If a party does not comply with a recommendation or direction, they must outline in writing why they have not complied so that the IRC can determine whether a further conciliation is appropriate.
The IRC will be empowered to make arbitration orders (that apply from the date of the order or a later date), including on a final or interim basis, which will effectively stop an industrial dispute. Breaching such orders incurs a civil penalty of $25,000 (more on this below).
An extension of the IRC’s dispute resolution jurisdiction will now permit it to deal with disputes about injured workers, which may include deciding matters around returning to work and the types of alternative duties that might be suitable.
Expanded victimisation protections
The current IR Act requires an employee, seeking to commence a victimisation claim, to establish (or at least allege) that they have suffered a detriment because of the existence of a “protected matter” outlined in s210(1) of the IR Act.
A rebuttable presumption will then apply – it is presumed that an employee experienced detriment because of the alleged protected matter, unless the employer satisfies the IRC that the alleged matter was not a substantial and operative cause of the detriment.
With the changes, the scope of protected matters will be expanded significantly, such that an employee could now commence a victimisation claim if they suffered a detriment because they:
- are entitled to a benefit or a claim under workers compensation;
- have a role or responsibility under an industrial legislation or instrument;
- engage in or propose to engage in industrial organisation activities;
- have a “characteristic” (not just an attribute) protected from discrimination under the Anti-Discrimination Act 1977 (NSW) (AD Act);
- made a “complaint” or “inquiry” about their employment – as federal system employers know, these concepts have been interpreted broadly; or
- made a “complaint” or “inquiry” to a public authority about their employer (including about matters other than their employment).
These changes will likely increase the number of victimisation claims in the IRC. They create an alternate option for employees who feel they have been subjected to discriminatory behaviour, although employees cannot commence both a claim under anti-discrimination legislation (federal or state) and a victimisation claim – it’s one or another.
The changes introduce an “objective” element to the rebuttal presumption. An employer must satisfy the IRC that from an “objective” perspective, the alleged protected matter was not a substantial and operative cause of the detriment. Relying on the subjective evidence of a decision maker may be not sufficient to meet this “objective” test and the IRC may rely on “unconscious factors” when determining the cause of the detrimental action.
Prohibition against sexual harassment in connection with work
The changes introduce an express prohibition against “sexual harassment” towards another person “in connection with” that person being an employee, a prospective employee or a person conducting a business or undertaking.
The definition of “sexual harassment” has the same meaning as in the AD Act – being an unwelcome sexual advance, an unwelcome request for sexual favours, or unwelcome conduct of a sexual nature, by one person towards another person, in circumstances where a reasonable person, having regard to all the circumstances, would have anticipated that the other person would be offended, humiliated or intimidated.
An employer is vicariously liable if their employee or agent engages in sexual harassment, and did so in connection with their employment or their duties as an agent, unless the employer establishes that they took all reasonable steps to prevent the employee or agent from engaging in the unlawful act.
Stop bullying and sexual harassment orders
Employees in the federal jurisdiction have had access to stop bullying and stop sexual harassment orders for some time now.
The incoming NSW jurisdiction aims to “fill a gap” for NSW state and local government employees, which extends beyond the federal scheme in some respects.
The IRC will be empowered to make any order it considers appropriate to prevent a person from being bullied or if a person has been sexually harassed.
Damages of up to $100,000 are available.
Download a summary here which sets out more detail regarding this new jurisdiction.
Provision of information during bargaining
The changes will require the provision of information about gender equality in the context of mutual gains bargaining or as an element of good faith bargaining, placing greater focus on how proposed terms and conditions achieve gender equality in the workplace.
Civil penalty jurisdiction and other changes
The IR Act will include provisions that allow the Industrial Court (and the IRC in court session) to make civil penalty orders in the event an employer contravenes a civil penalty provision.
The IRC in court session has been granted express statutory power to grant injunctive relief to restrain further contraventions of civil penalty provisions.
The small claims division of the Industrial Court now has jurisdiction to award up to $100,000 (previously $10,000).
Key takeaways
Employers must become familiar with the changes – they affect all aspects of industrial relations and the employment relationship, from bargaining to the handling of complaints made by employees.
The changes may result in a greater number of victimisation claims, particularly in the areas of alleged detriment arising from workplace complaints or association with a union or industrial organisation
The IRC having access to compensation orders of up to $100,000 when granting stop bullying or anti-sexual harassment orders makes these orders more impactful than their federal counterparts.
The defences to vicarious liability for sexual harassment continue to apply – clear evidence of robust training and policies will support an argument that all reasonable steps have been taken to stop employees from engaging in sexual harassment.
Conclusion
The Bill awaits Royal Assent with the changes to commence on a day to be confirmed.
Please do not hesitate to contact the authors for a detailed briefing of the Bill.
This Insight article is part one of a two-part Insight article series. For an overview of how the Workplace Protections Bill is changing the Work Health and Safety Act 2011 (NSW), please see part two of the series here.
[1] Ministerial media release, Minns Labor Government introduces flagship legislation to prevent psychological and physical workplace injuries, 27 May 2025.
The views expressed in this article are general in nature only and do not constitute legal advice. Please contact us if you require specific advice tailored to the needs of your organisation’s circumstances.