Proposed NSW AI safety laws expand unions’ rights to inspect digital work systems

The Work Health and Safety Amendment (Digital Work Systems) was introduced in November 2025, and the Legislative Council is now considering and debating it. It proposes significant amendments to the existing laws regulating the use of digital work systems and seeks to amend it to expressly regulate the health and safety impacts of digital work systems.

Currently, there is no set date for when these changes will come into effect. However, given the compliance implications, employers should begin to prepare by reviewing the digital systems they currently have in place.

These systems are defined to include any algorithm, artificial intelligence, automation or online platform, reflecting the increasing reliance on digitally assisted work allocation, monitoring and performance management in the workplace.

The amendments include a newly inserted provision which will create an additional primary duty of care for employers to ensure that the health and safety of workers is not put at risk from the use of digital work systems in a business or undertaking.
It also proposes the insertion of another provision placing an active duty on employers to ensure that any digital work system used does not risk the health and safety of a worker. The proposed provisions sets out risks that a person conducting a business or undertaking (PCBUs) must consider, including:

• excessive or unreasonable workloads for workers at work in the business or undertaking;
• the use of excessive or unreasonable metrics to assess and track the performance of workers at work in the business or undertaking;
• excessive or unreasonable monitoring or surveillance of workers at work in the business or undertaking; and
• discriminatory practices or decision-making in the conduct of the business or undertaking.

Under existing WHS laws, inspectors, unions and other permit holders may enter workplaces to inquire into suspected contraventions of the Act. The revised legislation, in its current drafting, will expand these powers by allowing permit holders to require reasonable assistance to access and inspect digital work systems suspected of breaching WHS obligations. 

This would, according to the second reading speech: “In practice, reasonable assistance means allowing the permit holder to access and inspect the system or providing an explanation of how the system functions so that the permit holder can meaningfully carry out the inspection. This amendment is important because individual workers often do not have visibility of how digital work systems operate or the awareness or opportunity to identify risks embedded within them.”

This would include access to system data, explanations of system logic, and demonstrations of how work is allocated or monitored. It would, in essence, require clarity about algorithmic management. The powers of an entry permit holder would be subject to guidelines made by the regulator, Safe Work Australia, who will be required to issue and publish guidelines on their website. Safe Work has not yet issued any proposed or suggested guidelines to consider in anticipation of these amendments.

An employer's refusal to assist an inspector can result in a maximum A$66,770 (approx. US$46,511) fine for a corporation, or a A$13,310 fine for an individual.

The proposed amendment allows for the minister for employment and workplace to determine, amongst other things, whether the new laws provide a higher standard of health and safety for workers than the relevant provisions.

Should the bill pass both NSW parliament, the state will be the first in Australia to address the safety risks posed to workers by digital work systems.

What do these amendments mean for employers?

The proposed amendments place a new level of scrutiny on the technologies employers use within the workplace. Businesses must continually review and monitor the digital tools they use, particularly those involved in work allocation, rostering, monitoring, or productivity assessment. Examples of systems likely to be captured include:

• automated shift allocation tools;
•  workflow allocation engines;
• AI-driven productivity scoring systems; and
• monitoring software that tracks keystrokes, task completion speed, or call handling time.

This wide definition means that even commonplace HR systems, scheduling software and management platforms will likely fall within its scope if the law is passed. Accordingly, PCBUs will therefore need to audit the digital systems currently in use, identify where work is being influenced or allocated by algorithms, and consider whether these systems could contribute to psychosocial risks.

A major challenge for businesses will be interpreting what amounts to “excessive or unreasonable workloads” or “excessive monitoring and metrics”. These concepts are inherently broad and ambiguous, and may vary across industries, roles and workforce demographics. Employers should expect the regulator to take a precautionary approach, especially where digital systems lack transparency or where workers have limited ability to challenge or understand automated decisions.

To prepare for the new requirements, employers should consider implementing the following measures:

• ensure there is human oversight on the usage of digital work systems – while these systems may certainly be useful in terms of efficiency, human oversight is essential in minimising psychosocial safety risks that may occur;
•  conduct a risk assessment by reviewing what systems are already in place and whether these are at risk of harming workers;
• consult with workers about levels of burnout, anxiety or fatigue associated with monitoring practices or workload allocation; and
• consider implementing training sessions for managers and senior executives as to what these new amendments will require and how to use the benefits of digital work systems responsibly.

Co-written by Nadine Walker of Pinsent Masons.