What happens: Ten major business organizations have one joint statement warned that the NSW legislation would grant union officials digital access to workplace systems including emails, payroll, customer databases and financial data in every business in the state.
Why this is important: The legislation comes as companies report that compliance has become more difficult in the past year. The bill introduced without regulatory impact statements or formal consultation with the small business sector will have the greatest impact.
A coalition of Australia’s largest business organizations have united to oppose the NSW government’s legislation, which they say will put sensitive personal data at risk and seriously undermine major projects across the state.
The joint statement, issued by ten industry bodies including the Business Council of Australia, Australian Industry Group and Council of Small Business Organizations Australia, warns that the Work Health and Safety Amendment (Digital Work Systems) Bill 2025 would grant union officials access to a wide range of digital systems in the workplace.
The legislation would apply to every workplace in NSW, from small retailers and hospitality venues to construction sites, housing developments, hospitals, schools, manufacturers, miners and government agencies that hold large amounts of confidential personal data, the joint statement said.
Matthew Addison, president of the Council of Small Business Organizations Australia, described the legislation as “a Trojan horse granting union officials WHS access, providing unprecedented access to digital business systems including platforms holding payroll data, customer lists, pricing algorithms and operational strategies, with penalties for companies that fail to provide reasonable assistance.”
The bill broadly defines a digital work system as “an algorithm, artificial intelligence, automation, or online platform,” which potentially includes almost any piece of software used in modern workplaces.
Business Council of Australia CEO Bran Black warned that “giving unions unlimited powers to access and inspect workplace digital systems is dangerous and reckless – it puts employee privacy at risk and forces companies to hand over highly sensitive commercial data without appropriate safeguards.”
The NSW Government introduced the bill via Industrial Relations Minister Sophie Cotsis, who said: “through this bill, the government wants to ensure that digital workplace systems help businesses and do not undermine the health and safety of workers.”
Minister Cotsis added that “when a system tracks you, times you and pushes you beyond safe limits – it is not innovation, it is its exploitation.”
The legislation is a response to a 2022 parliamentary committee report on technological change and its impact on the psychosocial health of workers. According to Sophie Cotsis’s Second Reading Speech, examples of inspectable items include “code or algorithms, performance metrics, records, data logs, and audit trails generated by digital systems.” Herbert Smith Freehill’s Kramer
Small business advocates have expressed particular concerns about the compliance burden. Addison said the compliance obligations in the bill are unclear because companies must ensure digital systems do not create “excessive,” “unreasonable” or “discriminatory” results. Yet none of these terms have been defined, leaving companies uncertain about their obligations.
The Council of Small Business Organizations Australia highlighted that the bill was introduced without any statement on regulatory impact, cost analysis or formal consultation with the small business sector, increasing concerns about hasty implementation.
Helen Waldron, head of the Australian Industry Group of New South Wales, said: “the proposed changes are completely unnecessary and the unclear obligations they would impose on the industry will undoubtedly be a catalyst for workplace discussions.”
Business groups also warned of timing issues. The federal government is currently hosting discussions on whether the implementation of artificial intelligence should be regulated nationally, while Safe Work Australia has been commissioned to conduct a best practice study aimed at harmonizing occupational health and safety laws.
COSBOA warned that the legislation is being rushed through the NSW Parliament before Safe Work Australia finalizes national guidelines for digital work systems, creating another example of NSW breaking ranks on national workplace regulations, the organization’s statement said, urging Parliament to address fundamental concerns about privacy, cyber security and the protection of employee and customer data.
Industry groups highlighted that current WHS legislation already requires companies to manage all workplace risks, including those from digital systems, and questioned the need for additional legislation.
The organizations warned that the impact would be particularly severe on residential construction and major infrastructure, energy and resources projects, where complex digital systems are central to business operations, with increased risks, uncertainty and delays directly undermining housing supply and investment decisions.
The joint statement concluded that without changes, the bill would make NSW an outlier and an investment killer.
COSBOA has called on the NSW Government to exempt small businesses with fewer than 50 full-time employees and undertake meaningful consultation before introducing the bill, with businesses reporting the cumulative regulatory burden could overwhelm businesses, especially SMEs.
The legislation is still before the NSW Parliament, with industry groups continuing to call for changes that address concerns around data privacy, commercial confidentiality and alignment with national workplace frameworks.
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