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Western Australia’s workplace landscape just got a significant regulatory update with the introduction of the Workers' Compensation and Injury Management Act 2023-2025. This new framework replaces outdated legislation to better reflect the modern workforce and improve how work-related injuries and illnesses are managed across the state. Whether you’re an employer, HR manager, or business owner, understanding the new WA workers' comp laws is vital to ensure compliance, avoid financial penalties, and support injured workers effectively.
This blog breaks down what you need to know about the latest WA workers' comp updates—including what’s changed, what it means for your business, and what practical steps you need to take right now.
What Is Workers Compensation in Western Australia?
Workers compensation in Western Australia provides wage replacement, medical treatment, and rehabilitation services to employees who become injured or ill as a result of their job. Under the WA Workers Compensation Act, all employers must hold insurance coverage to fund these benefits. The system is regulated and administered by WorkCover WA, which oversees compliance, education, and dispute resolution.
WA’s scheme applies to full-time, part-time, and casual workers and includes new workers regardless of how long they’ve been employed.
Key Statistics: Why These Changes Matter
WorkCover WA data shows that over 110,000 workers compensation claims are lodged annually, with injury rates rising particularly in industries like construction, healthcare, and agriculture. Psychological injuries now make up around 20% of these cases—a number that’s steadily increasing due to growing workplace stress, exposure to trauma, and burnout.
These statistics indicate significant demand for a flexible, responsive system that takes into account both physical and psychological injuries. The new WA workers compensation laws aim to meet this demand.
Major Changes in the WA Workers Compensation Act 2023-2024
1. Increased Limits on Medical & Health Expenses
Previously, injured workers faced limits on reimbursable treatment costs. Under the new Act, these monetary caps have doubled, providing better access to essential treatment, including specialist appointments, surgery, physiotherapy, and mental health services. For employers and insurers, this may result in larger individual claim payouts—but it's also expected to reduce longer-term costs by facilitating faster recovery and return-to-work timelines.
2. Step-Down Delay from 13 to 26 Weeks
Before 2023, workers received reduced weekly compensation after just 13 weeks off work. The law now extends that full-pay period to 26 weeks. Why does this matter? It reduces financial stress for injured workers while still encouraging employers to support early recovery and return to work programs. With more than 40% of long-term claims exceeding three months in recovery, this extension creates a more humane and practical buffer for recovery.
3. Fairer Wage Calculations
New wage calculation methods provide two options for determining weekly compensation: a 12-month lookback period or the average since employment began—whichever is more favourable to the worker. This particularly benefits casual and part-time workers, gig economy employees, and those recently hired. The goal is to ensure compensation reflects actual earnings—not just arbitrary or outdated formulas.
4. Psychological Injuries Now Clearly Covered
The new WA workers comp laws put psychological injuries and mental health conditions on equal footing with physical injuries. Claims for conditions such as PTSD, anxiety, and work-related depression are better defined, with clearer eligibility and claims pathways.
Workplaces must also meet new mental health safety standards. Employers are required to show evidence of mental health risk management processes, including employee training, supervisor awareness, and access to Employee Assistance Programs (EAPs). Psychological injuries now represent up to 30% of claim costs—even if they only make up about one-fifth of overall claims—because they often take longer to resolve and involve extensive treatment.
5. Catastrophic Injury Coverage Enhanced
The new version of the Catastrophic Injuries Support Scheme expands available services for individuals with severe, permanent injuries. This applies in cases of significant spinal trauma, brain injuries, and multiple limb loss. Support now includes advanced assistive technologies, at-home care subsidies, and tailored rehabilitation programs. For employers, this means ensuring incident reporting and claims are prompt and well-documented to avoid delays in accessing these enhanced services.
6. Faster Claims & Record-Keeping Requirements
Employers must now notify their insurer of a workplace injury within 7 calendar days (down from 14). The penalties for late notification are steep—up to $10,000 per worker. WorkCover WA enforces this rule and routinely audits workplace compliance.
This highlights the need for robust internal reporting systems, clear documentation processes, and staff training on incident response. Late paper trails can now trigger not just claim disputes but financial penalties and loss of insurance benefits.
What Employers Should Do Now to Comply
If you’re an employer in WA, here are five concrete actions to stay compliant with the new WA workers compensation laws:
1. Update Your Injury Management Policies
Ensure your internal procedures for injury notification, claims submission, and return-to-work programs align with the new requirements. Review timelines, documentation workflows, and team responsibilities.
2. Add Mental Health to Your Risk Management Plan
Under the updated WA workers comp framework, you must show that psychological risks are being assessed and managed. This includes risk assessments, manager training, and resources like EAPs.
3. Train Staff on New Requirements
Your HR, supervisory, and site safety staff need to understand:
- The 7-day injury report deadline
- Mental health claim pathways
- The change in weekly compensation and income calculation methods
Consider engaging expert consultants to review and update your insurance policy.
4. Communicate with Your Insurer
Work closely with your workers compensation insurer to identify how policy premiums or excess structures may change. Early coordination ensures smoother claims management and faster payouts.
5. Stay Updated via WorkCover WA
WorkCover WA regularly releases guidance notes on new WA workers comp laws and best practices. Subscribe to alerts, attend quarterly webinars, or join a local employer network to stay informed.
Fines and Penalties: What’s at Stake?
Here’s what non-compliance can cost your business:
- Late injury report: Up to $10,000 per worker
- Failure to maintain proper return-to-work plans: $5,000+
- Inadequate psychological risk measures: Investigations and possible stop-work orders
- Repeat offences: Possible cancellation of workers compensation coverage
These aren’t just theoretical figures—WorkCover WA enforces these penalties, and a 2023-2024 compliance blitz resulted in over 1,200 enforcement actions and $2.5 million in penalties statewide.
The Workers Compensation and Injury Management Act 2023-2024 represents a turning point in how workplace injuries are handled in Western Australia. By increasing benefits, streamlining claims, and introducing meaningful mental health coverage, the framework now more accurately reflects today’s work environment—and the challenges that come with it.
Whether you’re a small retailer or a large construction firm, adapting quickly to these changes will prevent costly mistakes and support a safer workplace culture.
In conclusion:
- Keep your policies updated
- Educate your workforce
- Prioritise mental health
- Act within timelines
Contact CBI if you want to get a new worker compensation insurance policy for your employees.
Read More
Workers' Compensation: Essential Steps for Australian Businesses
What Every Employer Needs to Know About Workers Compensation Insurance in WA
