By Brittany Morgan and Brian Powles

The commencement of 2026 has brought with it a significant expansion of the obligations imposed on persons conducting a business or undertaking (PCBUs) under the Work Health and Safety Act 2011 (NSW) (WHS Act), following the introduction of the Work Health and Safety Amendment (Digital Work Systems) Bill 2025 (NSW) (Bill).

As outlined in the Explanatory Memorandum, the Bill introduces an express primary duty of care requiring PCBUs to ensure that the health and safety of workers is not put at risk by the use of a digital work systems. A “digital work system” is now defined broadly within the WHS Act to include algorithms, artificial intelligence, automation and online platforms.

The newly inserted section 21A of the WHS Act requires PCBUs to ensure that any digital work system they use, including any work allocated by that system, does not pose a risk to workers’ health and safety, including the now‑express protection of workers’ psychosocial safety. In assessing compliance, PCBUs must have regard to risks associated with work allocation through digital systems, including:

• Excessive or unreasonable workloads;
• Excessive or unreasonable metrices to assess or track performance;
• Excessive or unreasonable monitoring or surveillance of workers; and
• Unlawful discriminatory practices or decision making.

The Bill also expands the powers of work health and safety entry permit holders (WHS Permit Holder). In particular, PCBUs are now required to provide reasonable assistance to enable a WHS Permit Holder to access and inspect a digital work system where it is relevant to a suspected contravention of the WHS Act. A WHS Permit Holder must give notice of the proposed entry at least 48 hours, and no more than 14 days, before the entry.  This includes Union officials with WHS entry permits, so long as they hold a ‘reasonable suspicion’ in relation to a WHS contravention.

There is, however, a carve‑out where a PCBU is not required to provide access or assistance if doing so would contravene a Commonwealth or State law.

PCBUs that refuse or fail to comply with these obligations face penalties of up to 121 penalty units for individuals and 607 penalty units for bodies corporate. A penalty unit under the WHS Act for FY25-26 is $123.31, which is subject to increase in July 2026.

Whether these reforms strike the right balance for employee protection in an increasingly digital economy, or simply add another compliance hurdle for PCBUs, will no doubt be tested. In the meantime, employers should take a close look at how artificial intelligence and other digital systems are being used in their businesses, particularly given the risk of embedded bias in generative AI and the exposure this now creates under the WHS Act.