WHS Penalties NSW: What Every Business Owner Needs to Know in 2025–26

WHS penalties in NSW now exceed $11 million for bodies corporate and carry up to 10 years’ imprisonment for individuals. Since 1 July 2024, NSW has significantly increased penalty rates under the Work Health and Safety Amendment Act 2023, with penalty amounts indexed annually using a penalty unit value of $123.31 for the 2025–26 financial year. Both companies and individuals face prosecution and you cannot insure against these fines.

If you run a business in New South Wales, these penalties apply to you. They apply to your directors and depending on the circumstances, they apply to your workers too.

This guide breaks down the three categories of WHS offences, explains who carries personal liability, shows you the current dollar amounts behind every penalty unit figure, and gives you a practical compliance checklist you can act on today.

Maximum WHS Penalties in NSW: Full Breakdown

The Work Health and Safety Act 2011 (NSW) categorises offences into three tiers based on severity, plus industrial manslaughter provisions introduced directly into the Work Health and Safety Act 2011 (NSW) as Part 2A, s 34C via the Work Health and Safety Amendment (Industrial Manslaughter) Act 2024.

Maximum penalties have more than doubled since the 2023 amendments took effect on 1 July 2024.

The following table shows the maximum penalties for each offence category using 2025–26 indexed penalty unit values.

Offence	Description	Individual (Worker)	PCBU / Officer	Body Corporate
Industrial Manslaughter	Gross negligence causing workplace death	25 years’ imprisonment	25 years’ imprisonment	$20,000,000
Category 1 (s31)	Reckless or grossly negligent breach of duty	9,038 PU = $1,114,475 + 10 yrs	18,805 PU = $2,318,844 + 10 yrs	90,424 PU = $11,150,183
Category 2 (s32)	Failure to comply with duty exposing person to risk of death or serious injury	1,813 PU = $223,561	3,626 PU = $447,122	18,128 PU = $2,235,363
Category 3 (s33)	General failure to comply with a health and safety duty	607 PU = $74,849	1,214 PU = $149,698	6,070 PU = $748,492

Key distinction: Category 1 requires proof of gross negligence or recklessness. Category 2 only requires that the breach exposed someone to a risk of death or serious injury (no recklessness needed). This makes Category 2 significantly easier to prosecute and it is the most commonly pursued offence category in New South Wales.

Since the 2023 amendments, courts can also consider a company’s “corporate culture” when determining whether a body corporate acted recklessly for Category 1 purposes. If the culture of the organisation directed, encouraged, tolerated, or led to unsafe conduct, that can now be used to establish recklessness — making prosecution of companies substantially easier.

Can Employees Be Fined Under the WHS Act?

Yes. Under Section 28 of the WHS Act, workers have four specific duties. While at work, a worker must:

1. Take reasonable care for their own health and safety.
2. Take reasonable care that their acts or omissions do not adversely affect the health and safety of other persons.
3. Comply with any reasonable instruction given by the PCBU to allow the PCBU to comply with the Act.
4. Cooperate with any reasonable policy or procedure of the PCBU relating to health and safety.

Workers who breach these duties can face Category 3 penalties of up to 607 penalty units (approximately $74,800 in 2025–26). For a Category 2 breach that exposes someone to the risk of death or serious injury, a worker faces up to 1,813 penalty units (approximately $223,000). A Category 1 offence involving reckless conduct can result in fines exceeding $1.1 million and up to 10 years’ imprisonment.

Other persons at the workplace — visitors, customers, labour hire workers — also have duties under Section 29 and face the same penalty structure.

However, a critical point for business owners: the PCBU’s primary duty of care cannot be transferred to a worker. Even when an employee’s actions directly cause an incident, the PCBU retains its duty under Section 19. If the system of work was inadequate, the training insufficient, or the supervision lacking, the PCBU and its officers remain liable alongside the worker.

Duty Holder Liability: Who Faces What?

Duty Holder	Category 3 Max	Category 2 Max	Category 1 Max
Body Corporate (PCBU)	~$748,600	~$2.23M	~$11.15M
Individual PCBU / Officer	~$149,600	~$447,000	~$2.32M + 10 yrs
Worker / Other Individual	~$74,800	~$223,000	~$1.11M + 10 yrs

Officer Liability for WHS Breaches in NSW

Officers are personally liable under Section 27 of the WHS Act. This is not a derivative liability that flows from the PCBU’s breach — it is a separate, positive duty. An officer can be prosecuted and convicted whether or not the PCBU itself has been found guilty of an offence.

Maximum penalties for officers match those of individual PCBUs: up to approximately $2.32 million and 10 years’ imprisonment for Category 1 offences. For Category 2, the maximum is approximately $447,000. Even a Category 3 general breach carries a fine of up to approximately $149,600.

Who Is an Officer?

The WHS Act adopts the definition of “officer” from Section 9 of the Commonwealth Corporations Act 2001. This includes directors and company secretaries, but it extends further. Any person who makes or participates in making decisions that affect the whole or a substantial part of the business is potentially an officer. This can capture senior managers, general managers, and executives who influence how the business operates — even if they do not hold a formal directorship. A simple way to view this is that an officer is anyone who has the authority to make substantial decisions affecting the financial standing of the business, including the ability to allocate budgets, control resources, and materially impact the company’s financial position.

Who is not an officer: Supervisors, team leaders, and middle managers are generally not officers because they implement decisions rather than make the strategic decisions that shape the business. However, the line can be blurred, and the determination depends on the individual’s actual role and influence, not their job title.

The Six Due Diligence Requirements Under Section 27(5)

Section 27(5) sets out six reasonable steps an officer must take to discharge their due diligence duty. This is a non-exhaustive list — other steps may be required depending on the circumstances.

1. Acquire and keep up-to-date knowledge of WHS matters. This means understanding what the WHS Act requires, knowing the hazards relevant to your industry, and staying informed of regulatory changes.
2. Gain an understanding of the nature of the operations and the hazards and risks associated with those operations. You need to know what your business actually does on the ground, not just at the boardroom level.
3. Ensure the PCBU has available for use, and uses, appropriate resources and processes to eliminate or minimise risks. This covers staffing, equipment, training budgets, and safety systems.
4. Ensure the PCBU has appropriate processes for receiving and considering information about incidents, hazards, and risks — and for responding to that information in a timely way.
5. Ensure the PCBU has, and implements, processes for complying with any duty or obligation under the WHS Act. This includes consultation obligations, incident notification, and licence requirements.
6. Verify the provision and use of resources and processes. It is not enough to set up systems — you must actively check that they are being used effectively.

Consequences of Failing to Comply with WHS Legislation

The consequences of non-compliance extend well beyond fines. SafeWork NSW has a range of enforcement tools, and the penalties escalate significantly depending on the severity of the breach and the regulator’s assessment of the duty holder’s conduct.

The Enforcement Escalation Pathway

SafeWork NSW follows a graduated enforcement approach. Understanding where each action sits on the spectrum helps you assess your current compliance risk.

Improvement Notices: An inspector can issue an improvement notice requiring you to remedy a contravention or likely contravention within a specified period. Failure to comply with an improvement notice is itself an offence carrying substantial penalties.

Prohibition Notices: Where an activity involves or will involve a serious risk to health or safety, an inspector can issue a prohibition notice requiring the activity to stop immediately. Work cannot resume until the risk has been remedied.

On-the-Spot Penalty Notices: SafeWork NSW can issue penalty notices for prescribed offences without going to court. These are lower than court-imposed fines but represent an immediate financial consequence.

Enforceable Undertakings: A person can give SafeWork NSW a written undertaking in connection with a contravention. Once accepted, the undertaking is enforceable — breach of it is a separate offence.

Criminal Prosecution: For serious breaches, SafeWork NSW can prosecute duty holders in court. This is where the maximum penalties outlined in the penalty table apply. Convictions result in fines, imprisonment (for individuals), adverse publicity orders, and training orders.

Industrial Manslaughter: NSW introduced industrial manslaughter provisions under the Crimes Act 1900, carrying a maximum penalty of 25 years’ imprisonment for an individual and $20 million for a body corporate where a PCBU’s gross negligence causes the death of a worker.

Beyond Financial Penalties

Court-ordered consequences can include adverse publicity orders (requiring the offender to publicise the offence and penalty), work health and safety project orders (requiring the offender to undertake a specified WHS project), restoration orders, and training orders. These remedies can be more damaging to a business’s reputation and operations than the fine itself.

There is also the practical reality that a serious WHS incident triggers workers’ compensation claims, potential civil liability, loss of contracts (particularly government contracts requiring WHS prequalification), increased insurance premiums, and damage to the business’s ability to attract and retain workers.

NSW WHS Penalty Rates: Current Values and How Penalty Units Work

Penalties under the WHS Act are expressed in penalty units rather than fixed dollar amounts. This allows the government to increase fines annually without amending the legislation — the dollar value of a penalty unit is indexed each financial year based on the Consumer Price Index (CPI) under Section 242B of the WHS Act.

For the 2025–26 financial year, one NSW penalty unit is worth $123.31. This is up from $120.42 in 2024–25. The value increases every July, meaning your maximum penalty exposure grows automatically each year.

Penalty Unit Conversion Table

The following table converts the most common penalty unit amounts found in the WHS Act to their current dollar values.

Penalty Units	Dollar Value (2025–26)	Typical Application
607 PU	$74,849	Category 3 maximum — individual (worker/other)
1,214 PU	$149,698	Category 3 maximum — individual PCBU/officer
1,813 PU	$223,561	Category 2 maximum — individual (worker/other)
3,626 PU	$447,122	Category 2 maximum — individual PCBU/officer
4,500 PU	$554,895	Various WHS Regulation specific offences
6,070 PU	$748,492	Category 3 maximum — body corporate
7,500 PU	$924,825	Higher-tier WHS Regulation offences
9,038 PU	$1,114,475	Category 1 maximum — individual (worker/other)
18,128 PU	$2,235,363	Category 2 maximum — body corporate
18,805 PU	$2,318,844	Category 1 maximum — PCBU/officer
90,424 PU	$11,150,183	Category 1 maximum — body corporate

Note on ATO penalty units: The Commonwealth uses a separate penalty unit value ($330 for 2025–26) under the Crimes Act 1914 (Cth). When you see “20 penalty units” in an ATO context, it refers to Commonwealth penalty units, not NSW penalty units. The two systems are entirely separate.

What Happens When an Employee Violates WHS Policies

When an employee violates a WHS policy or procedure, the response needs to address two separate issues simultaneously: the immediate safety concern and the underlying system of work.

The employee can be personally liable for breaching their duties under Section 28. But the PCBU’s primary duty of care under Section 19 cannot be delegated or transferred to a worker. If the system of work was inadequate, the training insufficient, or the supervision lacking, the PCBU and its officers remain liable — regardless of the employee’s conduct.

Employer Response Framework

Step 1 — Make the workplace safe. The immediate priority is always to eliminate or control the risk. Stop the unsafe activity, isolate the hazard and ensure no one else is exposed.

Step 2 — Investigate the root cause. Determine whether the incident resulted from an individual worker’s decision or reflects a wider system failure. Consider whether the worker received appropriate training, whether the training was sufficient, if adequate supervision was in place, whether procedures were clear and accessible, and whether the correct equipment was provided. Use these insights to address immediate gaps and prevent recurrence.

Step 3 — Determine system vs individual failure. If the investigation reveals gaps in your system of work, the priority is fixing the system. Disciplining the worker without addressing the underlying cause does not discharge your PCBU duty — and it will not protect you in a prosecution.

Step 4 — Follow your disciplinary procedure. If the worker’s conduct was genuinely a breach of a reasonable instruction or policy that was clearly communicated, consistently enforced, and adequately supported by training and supervision, then disciplinary action is appropriate. Ensure it complies with your enterprise agreement or award, and document the process.

Step 5 — Review and improve systems. Regardless of disciplinary outcomes, use the incident to review your systems of work, training, supervision, and consultation processes. This is your Section 19 duty in action.

Can You Charge an Employee for WHS-Related Damages?

This question comes up frequently, and the short answer is that it depends on the circumstances and the employment arrangements in place. Generally, under common law, an employer may have a right of indemnity against an employee whose negligent conduct caused the employer’s loss, but this is rarely pursued in practice and is subject to significant legal constraints. The WHS Act does not provide a mechanism for PCBUs to recover WHS fines from workers. Any recovery action would be a civil matter separate from the WHS legislation, and professional legal advice is essential before pursuing this path.

Section 27 of the WHS Act: Officer Due Diligence Explained

Section 27 is one of the most significant provisions in the WHS Act for business owners and directors. It creates a positive, personal, and non-delegable duty on officers to exercise due diligence to ensure the PCBU complies with its WHS obligations.

This duty is separate from the PCBU’s own duties. An officer can be prosecuted for failing to exercise due diligence even if the PCBU has not been charged or convicted. The prosecution does not need to prove that a specific incident occurred — it only needs to show that the officer failed to take reasonable steps.

The six due diligence requirements in Section 27(5) are practical steps that officers can use as a compliance framework. For each requirement, ask yourself: “Can I demonstrate, with documented evidence, that I have taken reasonable steps to meet this obligation?”

Officer Due Diligence Compliance Scorecard

Due Diligence Requirement	What “Good” Looks Like	Evidence to Maintain
1. Keep up-to-date WHS knowledge	Regular attendance at WHS briefings, reading regulatory updates, understanding industry-specific codes of practice	Training records, briefing minutes, subscription to SafeWork NSW updates
2. Understand operations and associated hazards	Site visits, reviewing risk assessments, understanding work processes at an operational level	Site visit logs, risk register reviews, documented conversations with frontline workers
3. Ensure appropriate resources and processes	Adequate budget allocation for safety, appropriate staffing, access to necessary equipment and PPE	Board minutes approving WHS budgets, procurement records, staffing plans
4. Receive and respond to incident information	Clear incident reporting process, regular review of incident data, timely corrective actions	Incident register, management review meeting minutes, corrective action tracking
5. Ensure compliance processes exist and are implemented	Documented WHS management system, regular internal audits, consultation mechanisms in place	WHS policy documents, audit reports, toolbox talk records, HSR meeting minutes
6. Verify resources and processes are being used	Active monitoring, management reviews, checking that systems work in practice — not just on paper	Audit findings, walkthrough reports, KPI tracking, management review records

Category 2 WHS Offence Penalties

Category 2 is the most commonly prosecuted offence category under the WHS Act, and for good reason: the prosecution does not need to prove that the duty holder acted recklessly or with gross negligence. It only needs to establish that the person failed to comply with a health and safety duty and that this failure exposed an individual to a risk of death, serious injury, or illness.

This lower prosecution threshold makes Category 2 the offence most likely to affect your business. Any workplace activity that exposes a worker to a serious risk — and where your controls are inadequate — is a potential Category 2 breach.

NSW Category 2 Penalties (2025–26)

Duty Holder	Penalty Units	Dollar Value (2025–26)
Body Corporate	18,128 PU	~$2,234,940
Individual PCBU / Officer	3,626 PU	~$447,118
Individual (Worker / Other)	1,813 PU	~$223,559

The critical difference between Category 1 and Category 2 is the mental element. Category 1 requires proof that the person was reckless as to the risk or engaged in grossly negligent conduct. Category 2 has no mental element — the breach and the exposure to risk are sufficient. This is why compliance with your primary duty of care is so important: the regulator does not need to prove you knew about the risk or were careless about it, only that your duty was not fulfilled and someone was exposed.

Employer Rights and Responsibilities Under the WHS Act

Under the WHS Act, employers are classified as persons conducting a business or undertaking (PCBUs) and carry a primary duty of care under Section 19. This duty requires PCBUs to ensure, so far as is reasonably practicable, the health and safety of workers and other persons who could be put at risk by the business’s work.

Core PCBU Responsibilities

Safe work environment: Provide and maintain a work environment that is without risks to health and safety. This includes the physical workplace, plant and structures, systems of work, and the psychosocial work environment.

Information, training, instruction, and supervision: Ensure that workers receive adequate information, training, instruction, and supervision to protect them from risks to their health and safety. Training must be specific to the hazards workers face and must be documented.

Consultation: Consult with workers who carry out work for the business on matters that directly affect their health or safety. Consultation is not optional — it is a legal obligation that must be genuine, timely, and documented.

Employer Rights

Alongside these responsibilities, the WHS Act recognises that employers have the right to issue reasonable instructions to workers. Under Section 28, workers must comply with any reasonable instruction given by the PCBU that allows the PCBU to comply with the Act. Workers must also cooperate with any reasonable WHS policy or procedure.

This gives employers the legal foundation to direct work practices, require the use of personal protective equipment, mandate attendance at WHS training, and enforce safe work procedures — provided these instructions are reasonable and genuinely connected to WHS compliance.

Key Sections of the WHS Act You Should Know

The WHS Act is a substantial piece of legislation. These are the sections most frequently referenced in relation to duties, penalties, and compliance obligations.

Section 37: What Is a Dangerous Incident?

Section 37 defines a “dangerous incident” as an incident in relation to a workplace that exposes a worker or any other person to a serious risk from immediate or imminent exposure to a range of specified events. These include uncontrolled escape of substances, uncontrolled fires or explosions, electric shock, falls from height, collapse of structures or excavations, and failure of authorised plant.

Dangerous incidents are “notifiable incidents” under Section 35, meaning the PCBU must notify SafeWork NSW immediately after becoming aware of the incident (Section 38). The incident site must also be preserved under Section 39 until an inspector attends or directs otherwise.

Section 69: HSR Powers Limited to the Work Group

Section 69 limits the powers and functions of a health and safety representative (HSR) to the work group for which they were elected. An HSR can exercise their powers in relation to matters that affect or may affect workers in their work group. This is relevant because it defines the scope of HSR authority — they represent their specific work group, not the entire workforce.

Section 19: Primary Duty of Care

This is the foundation of the WHS Act for businesses. Section 19 imposes a duty on every PCBU to ensure, so far as is reasonably practicable, the health and safety of workers and other persons at the workplace. It represents the most expansive duty under WHS law and is the one most frequently cited in prosecutions.

Your WHS Compliance Checklist

Use this checklist to conduct an immediate assessment of your WHS compliance position. Each item relates directly to a duty or obligation under the WHS Act.

Compliance Item	Status	Priority
WHS policy documented, signed, and reviewed within 12 months	☐ Yes ☐ No	High
All officers identified and aware of their s27 due diligence duties	☐ Yes ☐ No	Critical
All workers completed WHS induction covering s28 duties	☐ Yes ☐ No	High
Risk register maintained and reviewed regularly	☐ Yes ☐ No	High
Consultation mechanisms documented (toolbox talks, HSR, committee)	☐ Yes ☐ No	High
Incident notification procedure aligned with s38 requirements	☐ Yes ☐ No	Critical
Site preservation procedure in place for notifiable incidents (s39)	☐ Yes ☐ No	Critical
Training records signed, dated, and specific to workplace hazards	☐ Yes ☐ No	High
High-risk work licences current and verified (WHS Reg s85)	☐ Yes ☐ No	Critical
Safe work method statements current for high-risk construction work	☐ Yes ☐ No	High
Emergency plan in place, tested, and documented	☐ Yes ☐ No	High
No insurance or indemnity arrangements covering WHS penalties	☐ Yes ☐ No	Critical

WHS penalties in NSW are real and enforceable. They are increasing and they apply to individuals as well as companies. The cost of compliance will always be a fraction of the cost of a prosecution — and no amount of money can undo the human cost of a serious workplace incident.

If any item on this checklist is marked “No,” that is your starting point. Take the first step today.

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Disclaimer: This article provides general information about WHS penalties in NSW and is current as at February 2026. It is not legal advice. Penalty amounts are based on the 2025–26 penalty unit value of $123.31 and are subject to annual indexation. For advice specific to your circumstances, consult a qualified WHS legal professional from Fair Workplace Solutions. For current penalty unit values, refer to SafeWork NSW at safework.nsw.gov.au.