Overview
What needs to be checked when liability is disputed?
Start with the insurer's written reasons, the diagnosed condition, the alleged work causes and the evidence about functional impact. A reliable response usually needs a dated factual sequence and medical reasoning that addresses both work events and any non-work or pre-existing factors.
- Align the claim to the right legal route first (weekly payments, treatment disputes, or WPI/lump sum).
- Build evidence in three layers: specialist report, dated timeline, and corroboration.
- A section 11A response should address the identified management action, causation, reasonableness and the way the action was carried out.
Which psychological-injury rules apply?
Law reviewed 2026-07-21
The new primary psychological injury rules apply where the employer first received notification of the injury on or after 1 July 2026. A primary psychological injury notified before that date continues under the earlier provisions. The amendments also do not apply in the same way to secondary psychological injuries, exempt workers such as police officers, paramedics and firefighters, coal miners, volunteers or dust-disease claims. The notification history, worker category and transitional provisions must be checked before choosing a legal test.
New primary psychological injury
For a primary psychological injury within the post-1 July 2026 framework, the claimed condition must be a mental or psychiatric disorder causing behavioural, cognitive or psychological dysfunction. Compensation is only payable if one or more statutory relevant events caused the injury, there is a real and direct connection between those events and the employment, and employment is the main contributing factor.
Bullying, sexual harassment, racial harassment and excessive work demands are “relevant conduct”. A post-1 July 2026 primary psychological injury caused by relevant conduct uses a special claim process. A completed claim form and prescribed minimum information are required; the insurer has 42 days after receiving a completed claim to decide liability. Interim weekly payments and up to $7,500 for eligible outpatient treatment may be available during that determination period. Provisional liability does not apply to this special claim type. If liability remains disputed, the insurer review and the correct IRC or PIC pathway depend on the stated reason for the decision.
Section 11A and earlier claims
For a claim to which the amended section 11A applies, no compensation is payable if the psychological injury was predominantly caused by reasonable management action taken or proposed by the employer, the worker's expectation of reasonable management action, or the worker's perception of reasonable management action. The action must be taken in a reasonable way and be reasonable in all the circumstances. The amended provision applies to both primary and secondary psychological injury.
For an earlier psychological injury claim governed by the pre-reform section 11A, the question was whether the injury was wholly or predominantly caused by specified reasonable action taken or proposed by or on behalf of the employer concerning matters such as transfer, demotion, promotion, performance appraisal, discipline, retrenchment, dismissal or employment benefits. The action and the way it was taken also had to be reasonable.
Permanent impairment threshold
Psychological injuries often face stricter dispute scrutiny than physical injuries in NSW.
- !15% WPI gateway: For a primary psychological injury, section 66 lump sum compensation generally requires an assessment of at least 15% WPI under the PIRS method.
- !Primary vs Secondary: Primary psychological injuries are treated differently from secondary psychological consequences of physical injury when assessing entitlement pathways.
How legal tests differ by remedy type
Not all psychological outcomes use the same legal test. A claim aimed at weekly payments or treatment approval focuses on different evidence than a lump sum pathway that tests permanent impairment and long-term functional impact.
- Weekly payments: usually requires detailed functional capacity material and treatment continuity, not just impairment score.
- Section 78 responses: usually turns on timing, medical opinion quality, and whether the causal chain is sufficiently tied to workplace factors.
- Lump sum (WPI): often requires at least 15% WPI evidence and a clear pathway from psychiatric diagnosis to workplace event impact.
Types of Psychological Claims
A psychological injury can be just as disabling as a physical injury. In NSW, claims usually involve either acute trauma exposure or cumulative workplace stressors such as bullying, harassment, or persistent unreasonable pressure.
PTSD (Post-Traumatic Stress Disorder)
Often linked to exposure to traumatic incidents, including serious accidents, workplace violence, or emergency-response events.
Major Depressive Disorder / Anxiety Conditions
May arise from prolonged bullying, harassment, unsafe psychosocial conditions, or sustained adverse treatment at work.
Reasonable management action under section 11A
Section 11A is not expressed the same way for every claim. For a claim within the post-1 July 2026 framework, the amended provision asks whether the psychological injury was predominantly caused by reasonable management action, the worker's expectation of such action, or the worker's perception of such action. The action must be reasonable in all the circumstances and carried out in a reasonable way. Earlier claims may instead use the former wholly or predominantly caused test for the specified categories of management action. The notification date, injury type and transitional provisions must be checked before applying either test.
- Transfer, demotion, or promotion decisions
- Performance reviews and disciplinary processes
- Work direction and supervision disputes
- Retrenchment or dismissal steps
If your claim was refused, start with practical next steps in claim denied disputes, Section 78 notice responses, and this focused section 11A dispute roadmap.
Is your claim being disputed under Section 11A?
Read the stated reasons carefully and obtain advice about the evidence and review pathway that apply to your circumstances.
Request a claim checkEvidence checklist
A disputed psychological injury claim usually needs more than a brief GP certificate because diagnosis, causation, capacity and permanent impairment involve different questions.
Detailed Psychiatric Evidence
Independent specialist reporting, including diagnosis, causation analysis, and impairment methodology.
Timeline + Documents
A chronological record of incidents, emails, complaints, medical attendances, and role changes.
Witness and Corroboration Material
Statements from colleagues or supervisors that support workplace causation and factual context.
How PIRS measures primary psychological impairment
After maximum medical improvement, the assessor uses the Psychiatric Impairment Rating Scale (PIRS) to classify six functional areas: self-care and personal hygiene, social and recreational activities, travel, social functioning, concentration/persistence/pace, and employability. The median class and the aggregate score are then read against NSW Guidelines Table 11.7 to determine WPI.
Illustrative calculation
If the six supported class ratings were 1, 2, 2, 3, 3 and 4, the median class would be 3 and the aggregate score would be 15. Under Table 11.7 that combination corresponds to 15% WPI. The classes must be supported by the actual functional evidence; this arithmetic illustration is not an impairment estimate.
What does not establish psychological WPI
- A diagnosis, symptom description or certificate of unfitness without PIRS functional findings.
- A secondary psychological consequence of a physical injury; NSW does not assess it as a separate WPI value.
- Adding a primary psychiatric WPI value to physical WPI; the assessments remain separate.
- A PIRS assessment before the condition has reached maximum medical improvement.
Source: NSW permanent impairment Guidelines, Chapter 11 and Table 11.7. General information only; this is not legal advice or an impairment estimate.
Current process
Permanent impairment assessments from 1 July 2026 to mid-2027
NSW is in an interim period. Separate examinations arranged by the worker and insurer can still occur, but an interim assessment must be performed by an assessor on SIRA's register. Liability for the injury must have been determined before an interim assessment is made.
Independent legal advice is compulsory
A worker must receive independent legal advice about the full legal implications before being seen by a permanent impairment assessor. Advice is also required before entering an impairment agreement.
The assessment can affect several entitlements
The principal assessment is used across weekly payments, medical and related treatment expenses, Section 66 lump sum compensation, commutation access and work injury damages. It is not only a lump sum calculation.
Agreement or medical dispute
If the worker and insurer agree on the degree of impairment, they may enter a written impairment agreement. If they do not agree, the insurer must give written notice and either party may refer the disagreement to the Personal Injury Commission as a medical dispute, supported by medical evidence.
A further assessment is tightly restricted
A second or later assessment during the interim period requires agreement that there appears to be unexpected and material deterioration. The deterioration must be capable of increasing the impairment by at least a further 10 percentage points. Ordinary age-related deterioration does not meet that test.
Last reviewed 20 July 2026. Sources: SIRA worker guidance and SIRA interim assessment guidance. See also the PIC dispute guide.
Different thresholds apply to different entitlements
For a primary psychological injury notified on or after 1 July 2026, the ordinary physical-injury section 39 description should not be used as a shortcut. Sections 39A and 39B create a separate weekly-payment framework, while section 66 lump sum compensation and work injury damages use different thresholds.
- Section 66 lump sum: at least 15% WPI for a primary psychological injury. Secondary psychological injury is not assessed for section 66 permanent impairment compensation.
- Weekly payments: 0-20% WPI is generally limited to 130 weeks. At 21-24% WPI, a worker may qualify for a further 52 weeks if the statutory capacity, work and application requirements are met. At 25-30% WPI, payments may continue to retiring age subject to section 38 requirements. More than 30% WPI is the highest-needs category.
- Medical and related treatment: post-reform primary psychological claims generally have a one-year period after weekly payments cease, or from the claim date if no weekly payments were made. Highest-needs workers are not subject to that maximum period.
- Work injury damages: from 1 July 2026 the psychological-injury gateway is at least 25% WPI, but employer negligence, economic loss and the other statutory requirements must also be established.
These post-reform thresholds do not automatically apply to injuries notified before 1 July 2026, secondary psychological injury or excluded worker groups. Source: SIRA psychological injury guidance, sections 8.1-8.5, reviewed 21 July 2026.
Related Help for Financial Pressure and Permanent Impairment
If a disputed psychological claim has affected your income, read what to do when weekly payments stop.
For serious and long-term injury outcomes, see how lump sum WPI claims are assessed.
Frequently Asked Questions
Can I claim compensation for workplace bullying-related depression?
Potentially. The key issues include the medical diagnosis, work-related causation and whether the insurer raises a reasonable management action defence. The applicable legal test and transitional rules depend on the circumstances and timing of the claim.
Do all psychological injuries require a 15% WPI rating?
No. The 15% WPI threshold concerns section 66 lump sum compensation for a primary psychological injury. Liability, weekly payments, treatment and other entitlements involve different legal tests. Secondary psychological impairment is not assessed for section 66 compensation.
What if my insurer says my condition is just “stress” and not compensable?
The insurer may be disputing the diagnosis, causation or another legal requirement. A specialist opinion, treating records and a dated factual chronology may help address the insurer’s written reasons, depending on the evidence.
Related psychological injury and dispute guides
- Serious injuries hub
- Workers compensation NSW service
- Workers compensation disputes
- Claim denied guide
- Section 78 notice guide
- Weekly payments hub
- Weekly payments stopped
- Psychological injury evidence guide
- PIC dispute process
- IME report dispute guide
- Lump sum WPI claims
- Section 11A psychological injury guide
- Start free claim check
Free Psychological Claim Check
Send the insurer decision and relevant medical material if you need help identifying which current rules and review pathway apply, especially where liability was denied under section 11A or weekly payments have stopped.