Company size is a poor proxy for workplace danger

A false premise, published on cue

Timing is everything. On 23 September 2026, the Business Leaders’ Health and Safety Forum released a report, authored by economist Shamubeel Eaqub, that pulls the rug out from under the central assumption of New Zealand’s incoming safety reform. Its verdict is blunt. “The 20-worker threshold separates small businesses from large ones, but it does not separate safe workplaces from unsafe ones,” the report states.

That lands less than a week after WorkSafe published its first guidance documents for the Health and Safety at Work Amendment Bill, which takes effect 1 April 2027. The reform, championed by ACT’s Brooke van Velden and billed as the largest reset of the safety regime in a decade, uses a 20-worker line as its organising principle. Firms below it, around 97% of all NZ businesses, will only be legally required to manage “critical risks”.

What the data actually shows

Eaqub’s finding is not that small firms are dangerous. It is that size tells you almost nothing. “When we looked at the injury rate by different sizes of firms and industries we found no consistent pattern,” he told RNZ. The variation is driven by industry, not headcount. A small forestry crew and a small accountancy practice sit in wildly different risk categories, yet the law treats them identically because both fall under 20 workers.

That is the problem with an administratively convenient threshold. It is easy to explain and easy to police, but it does not map onto where harm actually happens. Eaqub notes that NZ has comparable regulation to Australia and the UK but far worse outcomes, and that the difference is in how rules are applied, not how many there are.

The chronic harm bill nobody wants to own

Here is where the carve-out gets expensive. The EMA’s Paul Jarvie has pointed out that chronic-harm injuries account for around 65% of all ACC claims, mostly musculoskeletal conditions, and those do not count as critical risks. WorkSafe’s own data shows 4.7 million days of weekly ACC compensation generated each year by slips, trips, sprains and strains, the everyday injuries that fall outside the critical bracket. The EMA estimated these common harms cost more than $4.5 billion annually.

Strip small firms of any obligation to manage them and the cost does not vanish. It lands with ACC, and through ACC with every levy-paying business. The Forum’s report puts total workplace harm at $5.5 billion a year, up from $5.4 billion in its 2025 State of a Thriving Nation report.

The industry groups saw this coming

This is not a fringe objection. In March 2026, the EMA’s Jarvie warned that “business size has no bearing on risk, and this carve-out creates an unnecessary and concerning disconnect”. The Forum submitted at the same time that it “cannot support this carve-out”, arguing it was inequitable for workers to have different protection depending on their employer’s size. In June 2026, NZ Institute of Safety Management chair Mike Cosman said the changes “do nothing” to close the gap with Australia and the UK.

BusinessNZ took the other view, welcoming the reform. In July 2026, chief executive Katherine Rich said small firms “have struggled with a system that has become unnecessarily complex and difficult to apply in low-risk workplaces”, and argued clearer rules drive more engagement. She has a point about complexity. WorkSafe’s 2025 Workforce Insights survey found 15% of employers with up to five staff had implemented none of the measured safety practices, against just 3% of larger firms. That suggests the smallest firms are the least engaged, which is a strange group to hand fewer obligations.

Better regulation, not less of it

The pro-business case here is not for a lighter touch. It is for a smarter one. The Forum’s report identifies the real failures. There is no public register of approved codes of practice, despite more than two dozen existing. Plant machinery regulations have been slated for improvement since 2021 and remain unfinished. The Forum’s chief executive Francois Barton said NZ “lacks sufficiently clear stewardship and coordination across the system”. Its bottom line is “we need better regulatory practice, not more law.”

The underlying trend is actually improving. Stats NZ recorded 226,600 work-related injury claims in 2023, the lowest incidence rate since 2002. The reform could have accelerated that by fixing the plumbing. Instead it has locked in an arbitrary size line that industry groups across the spectrum opposed, while the systemic failures that explain NZ’s lag behind Australia and the UK sit untouched. Small businesses were never the safety problem. They deserved workable rules, not a carve-out that creates two classes of worker and leaves the bill with ACC.

Sources

• Company size makes no difference to workplace safety, report finds (2026-09-23)
• New guidance released for upcoming HSWA changes (2026-09-17)
• Will NZ’s workplace safety overhaul cut red tape – or simply shift responsibility? (2026-06-26)
• Workplace safety changes would create more confusion – health and safety expert (2026-06-16)
• Health and safety reform: Progress, but serious flaws still exist (EMA) (2026-03-17)
• Health and safety reforms put the focus where it belongs (BusinessNZ) (2026-07-01)
• Forum Submission on Health and Safety at Work Amendment Bill (2026-03)
• State of a Thriving Nation 2025 (2025-08)
• 2025 Workforce Insights Programme: employers and workers (2025-08-21)
• Injury statistics – work-related claims: 2023 (2024-09-24)