28 May 2026
7 min read
#New South Wales Government, #Workplace Relations & Safety
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The Work Health and Safety Amendment (Digital Work Systems) Act 2026 (NSW) (Amendment Act) represents the first express statutory duty in Australia directed at digital work systems, including algorithmic allocation of work, performance metrics and worker surveillance. The introduction of section 21A in the Work Health and Safety Act 2011(NSW) (WHS Act), which will commence on a date to be proclaimed, clarifies that the use of digital systems to allocate work is now legally considered a potential risk to health and safety which must be proactively managed by the primary duty holder, including NSW Government agencies.
The reforms reflect a broader regulatory focus on psychosocial risks arising from algorithmic management, monitoring and the use of automated decision making in the workplace. While the primary duty of care under section 19 of the WHS Act has always required NSW Government agencies, known in the legislation as a person conducting a business or undertaking (PCBU) to ensure, so far as is reasonably practicable the health and safety of workers, section 21A makes clear that digital systems fall within that duty and must be assessed and controlled as a system of work.
This raises important questions about how the duty will operate in practice for NSW Government agencies, how its structure is likely to shape enforcement, how it interacts with existing work health and safety (‘WHS’) jurisprudence, and how regulators may approach investigations into digital work systems.
In practice, under section 21A, the use of digital systems to allocate work is now legally considered a potential risk to health and safety that NSW Government agencies must proactively manage by implementing controls to eliminate or minimise the risk to workers.
Section 4 of the WHS Act provides a broad definition of a ‘digital work system’, which includes any algorithm, artificial intelligence, automation or online platform. Digital systems are not just tools or equipment, but rather a system of work which the PCBU must actively monitor.
Traditionally, work is allocated by a human supervisor. Under the new section 21A, the law now recognises that, when this task is delegated to a digital work system (including AI, algorithms or platforms), the mere use of the system has the potential to create a hazardous workplace environment.
The duty changes the obligations on NSW Government agencies such that they can no longer assume the digital system poses no risk in itself. Rather, the legislation requires an assessment to be undertaken of the digital system to determine whether it creates hazards, including excessive or unreasonable workloads for workers, the use of excessive or unreasonable performance metrics, excessive or unreasonable monitoring or surveillance, and unlawful discriminatory practices or decision making.
From an enforcement perspective, an inspector can attend a NSW Government workplace and enquire whether any digital work systems are being used to allocate work. The inspector can then enquire whether the agency has:
It may be reasonable for these steps to be undertaken by or in conjunction with a consultant or supplier of the digital system to the NSW Government agencies, but there must be evidence that the agency itself considered these issues in the context of the application of the system in the agency.
Agencies will essentially need to assess what their systems can do and whether they are operating appropriately. Many agencies rely on third-party systems with limited ability to modify them. However, the duty is nondelegable. If a PCBU uses a system, it must be able to explain how it works, why it is configured in that way, and take steps to control the risks arising from its use. Agencies cannot assume they can simply rely on software suppliers to explain why allocation occurs in the way it does and any limitations on modifying those systems.
Section 21A is included in the WHS Act as a general duty of care on a PCBU. It supplements the general duty under section 19, which requires a PCBU to ensure, so far as is reasonably practicable, the health and safety of workers engaged by the person, or whose activities are influenced or directed by the person, while they are at work.
The duty under section 19 also extends to other persons who may be exposed to harm because of the agencies’ operations. By contrast, section 21A requires the agency to undertake a risk assessment specifically for digital systems, but only in respect of workers (noting workers has a broader definition under the WHS Act to include contractors engaged by the PCBU).
The phrase ‘allocation of work by or using a digital work system’ is a key qualifier in defining the scope of the duty. The duty is not focused on all aspects of a digital system, but on the allocation of work. The provision recognises a digital system may not be conscious of matters that a human supervisor would ordinarily consider, such as the physical and mental health of workers or their level of experience.
The plain and ordinary meaning of the words extends beyond who is allocated a task and when they do it, to include how much time they have to complete it and any other factors used by the system in its decision making. The application of the duty is therefore dynamic and broad enough to cover both simple and complex operations.
The new duty is structured to include a mandatory framework of specific risks a PCBU must consider, including whether they are created by digital systems that allocate work.
Under section 21A(2), a PCBU must specifically assess whether the system results in:
By listing these four factors, the legislature has created a specific audit mechanism. A PCBU that cannot demonstrate it has assessed these areas of risk and implemented appropriate controls may breach section 21A, regardless of whether a physical or psychosocial injury has occurred.
Enforcement is likely to be shaped initially through education by the regulator as to the meaning of a digital system and the obligations of the PCBU. Inspectors may also rely on improvement notices to require agencies to undertake the necessary assessment process and implement appropriate controls. PCBUs are likely to rely on suppliers of digital systems to assist in this process. SafeWork NSW has committed to engaging approximately 20 specialist psychosocial inspectors whose focus will include digital systems as well.
Section 118A of the amended WHS Act mandates that SafeWork NSW must issue and publish formal guidelines specifically regarding the power of WHS entry permit holders to require reasonable assistance to access or inspect digital work systems. Permit holders cannot exercise these powers until at least one month after the guidelines are published. As at the date of publication, the guidelines have not been released.
The guidelines are expected to cover what a PCBU must provide to comply with the requirement to give reasonable assistance, including explanations of system logic, data logs and demonstrations of how work is allocated. They may also address risk assessment frameworks, examples of higher-order controls and industry specific risks.
If you have any questions regarding effectively implementing and managing digital work systems, please contact us here.
Disclaimer
The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.
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