Although the story of industrial relations in NSW began in 1856, when the stonemasons struck for and won the right for an eight-hour day, the involvement of the NSW Government in employment relations did not commence until almost forty years later, during the 1890s economic depression. In 1892, the Government Labour Bureau was set up under the Dibbs Government. From its inception, the Bureau was largely responsible for assisting the '...unemployed in finding work and [providing] assistance to families impoverished by unemployment. From 1892 to c1911, the Bureau provided welfare and assistance through the administering of sustenance relief payments - known as the 'susso' - and also by operating a type of employment agency for the unemployed known as the Central Labour Exchange.
In 1893, the NSW Government established a co-operative farm for unemployed workers on the former Pitt Town Common, which was known as the Pitt Town co-operative farm. The Government Labour Bureau was responsible for establishing and administering this 'socialist experiment' at the former Pitt Town Common, along with similar schemes at Bega, Wilberforce and Randwick, under an Act passed in 1893 to establish and regulate labour settlements on Crown Lands (56 Victoria Act No. 34).
These co-operative farms were established in response to the 1890s economic depression, but tended to be short-lived. The experimental farm at Pitt Town, for example, was closed in 1896. The aim of the Pitt Town co-operative farm had been to provide work for unemployed city workers during the long depression years of the 1890s, but the scheme failed because the farm was isolated from the city, and there was no infrastructure for city workers unused to rural working conditions. In 1896, the site of the former co-operative farm at Pitt Town was used as the Casual Labour Farm to train unemployed city workers as farm labourers. This scheme, administered by the Department of Labour and Industry, was in operation until 1910.
In 1895, the Government Labour Bureau came under purview of the Department of Public Instruction, administered by the Minister for Public Instruction and Minister for Labour and Industry. The Department of Labour and Industry was established in the following year and was responsible for a range of legislation including the Apprentices Act 1894, the Factories and Shops Act 1896 and the Conciliation and Arbitration Act 1899.
In 1901, the Government Labour Bureau was transferred to the control of the Department of Public Works, along with the Labour Commission which had been appointed in 1900 with the purpose of '…organising, classifying and controlling all labour not in employment.' Concurrent with the establishment of the Department of Labour and Industry in the 1890s, were the stirrings of an industrial disputes resolution system for NSW, which culminated in the establishment of the Industrial Commission in 1926. The Industrial Commission was intended to arbitrate disputes over pay and work conditions, and was instrumental in the resolution of strikes. Legislation relating to employment and industrial relations passed at the turn of the twentieth century included the Early Closing Act 1899, the Conciliation and Arbitration Act 1899, the Truck Act 1900 and the Industrial Arbitration Act 1901. The Arbitration Court, established in 1902 under the Industrial Arbitration Act, was administered by the Department of Attorney General and Justice. According to Labour Historian Greg Patmore, 'The NSW compulsory conciliation and arbitration system arose from the failure of collective bargaining and voluntary arbitration. Its administrative structure went through a period of experimentation (and its) final form adopted in 1926 was an Industrial Commission and conciliation committees.'
The Industrial Disputes Act 1908 gave the Crown a right to intervene into Arbitration Court cases and also allowed for ministerial intervention into legislation. The successive Presidents of the Arbitration Court from 1902, later the Industrial Commission from 1926, were independent arbiters who could settle disputes between employers and employees. The Attorney General continued to administer industrial relations legislation until 1911, when the Minister for Labour and Industry took up this responsibility. The Industrial Disputes Act 1912 saw the introduction of the wages boards, which regulated pay and conditions for workers. Another office within the Department, the Board of Trade, regularly held meetings and inquiries into living conditions from 1914 and throughout the 1920s and 1930s.
Into the twentieth century, the Department of Labour and Industry continued to play a pivotal role in employment relations in NSW, including the regulation of working conditions and wages, and ensuring occupational health and safety in the workplace, under the Factory and Shop Act 1912. One of the key roles of the Department under the Act was to provide information and advice about working conditions, as outlined below. As such, the Department had a different role to the Industrial Commission, which acted as an independent arbiter in cases of dispute between employer and employee.
In 1923, the Department of Labour and Industry undertook construction of its headquarters at 132 George Street in The Rocks. Sir George Fuller, the Premier of NSW at the time, laid the foundation stone on 28 September 1923. The Department of Labour and Industry had occupied this site on the corner of George and Argyle Streets from 1906, as well as an adjacent building at 134–136 George Street that was used as the State or Central Labour Exchange. The new purpose-built headquarters was intended to have dual functions, operating as the Central Labour Exchange, as well as the Immigration Bureau. At that time, the Department of Labour and Industry was responsible for immigration to NSW, the Immigration Bureau having been transferred to the Department in 1919.
The year the foundation stone was laid for the new building at 132 George Street was a turbulent one for labouring classes of Sydney, and the new building represented a threat to both striking and unemployed workers. The Royal Commission into Strikes commenced that year, and the introduction of the Empire Settlement Act 1922 and the Juvenile Migrants Apprenticeship Act 1923 paved the way for the passage of a new and competing workforce to Australia: the 'boy migrant'. In the early years of the twentieth century, the State Government sought to boost immigration to NSW, under the Dreadnought Scheme.
The Dreadnought Scheme, set up in 1911 and administered by the Department of Labour and Industry, facilitated the migration of 'boy migrants' and young men from Britain to be trained in farming and agriculture. The Pitt Town farm was renamed Scheyville for William Schey, who was Director of the State Labour Bureau from 1905 to 1912. Scheyville provided the main accommodation for the Dreadnought Scheme, which was in operation 1911–15, and then from 1919 to 1939. The Randwick Labour Farm (at times referred to as the Randwick Labour Depot) was established in 1905; it was initially associated with the Casual Labour Farm at Scheyville and later the Dreadnought Scheme.
The role of the Department of Labour and Industry evolved as the twentieth century progressed, and as the pace of industrialisation increased. The Factories and Shops Act 1912 and subsequent amendments to it, had a significant impact on the way that workplaces were set up and monitored. So while the Department still concentrated on providing assistance to the unemployed, through the administering the 'susso' and unemployment relief works, it had a new focus: accident prevention in the workplace, particularly industrial accidents. Under changes to the Factories and Shops Act in 1915, inspectors were appointed State-wide to carry out factory inspections.
District offices were established at Newcastle. Broken Hill, Goulburn, Lismore, Orange, Tamworth, Wagga Wagga and Wollongong. In addition to carrying out factory inspections, district inspectors (known as Country District Officers) were '…required to carry out work as Inspectors under the Industrial Arbitration Act and the Early Closing Acts, as well as that pertaining to the Departmental policy of Country Labour Exchanges'.
In 1940, the Department became the Department of Labour and Industry and Social Welfare until the mid-1950s, when the Department of Child Welfare and Social Welfare was established.
The health and safety function of the Department took precedence from the 1940s onwards, particularly in the period following World War Two when there was a boom in the manufacturing sector. Under the Factories, Shops and Industries Act 1962, the definition of a 'factory' was widened to encompass '…cool stores, packing houses, ship-building yards, dock yards, wool stores and premises used for the manufacture of dairy products'. By the 1960s and 70s, the Department continued to carry out factory inspections and convened advisory committees on safety standards, but was also engaging in preventative measures by holding conventions and forums on workplace safety, and by distributing occupational health and safety posters, and screening educational films with such titles as 'Don't Loose Your Grip' and 'Don't Be Sawed'. The Department was also responsible for regulating shop trading hours, proclaiming public holidays and prosecuting industrial law breaches where necessary, functions that the present Office of Industrial Relations continues today.
The Consumer Protection Act 1969 led the formation of the Consumer Affairs Division within the Department of Labour and Industry in 1969. The Consumer Affairs Division incorporated the Consumer Affairs Bureau, the Weights and Measures Office and the Prices Branch. In 1977, the Department of Consumer Affairs was created as a separate Government Department.
In 1979, the Department of Labour and Industry was abolished and a new Department of Industrial Relations and Technology was formed. The following year it was renamed the Department of Industrial Relations. As a result of an amalgamation with the Ministry of Employment in 1986, the Department became known as the Department of Industrial Relations and Employment. The occupational health and safety functions were transferred out of the Department in 1989 to join with the State Compensation Board and form the Workcover Authority of NSW.
In 1989, John Fahey, the Minister for Industrial Relations and Employment in the Greiner Government, prepared an Information Paper announcing an overhaul of NSW's Industrial Relations system.. Occupational health and safety inspections and regulations were taken over by a new statutory body known as Work Cover. In 1995 and 1996, the Department of Industrial Relations advised the Carr Government and the Minister for Industrial Relations, Jeff Shaw, on the development of what ultimately become the Industrial Relations Act 1996. During the tenure of Mr Shaw as Attorney-General and Minister for Industrial Relations, portfolio responsibility for the Industrial Relations Commission of New South Wales was transferred to the Attorney-General's Department.
In 2003, the Department of Industrial Relations was abolished and the new Office of Industrial Relations (OIR) was created under the Department of Commerce. The commencement of the Federal Work Choices legislation in March 2006 reduced the number of employers and employees who were directly covered by the State industrial relations system, by moving employees of constitutional corporations are now covered by the federal workplace relations system. The reliance by the Commonwealth Government on the 'corporations' power in the Commonwealth Constitution was upheld by the High Court in the Work Choices case.
While the election of the Rudd Government in 2007 meant that the Commonwealth was committed to replacing Work Choices with a new Forward with Fairness system, the reliance on the constitutional corporation status of the employer as the marker of which system an employer and its employees belong to did not change.
The Forward with Fairness reforms saw changes to the controversial aspects of Work Choices legislation, while keeping some of the main elements, such as the 'federalisation' of workplace relations.
In 2009, the Office of Industrial Relations became NSW Industrial Relations (NSW IR), part of the Department of Services, Techology and Administration.
The NSW Government agreed to join the national workplace relations system in December 2009.
The Fair Work Act 2009 (Cth) commenced on 1 January 2010, with the introduction of 10 National Employment Standards (NES) and a national system of industry specific modern awards underpinning the work of most Australians. A key function of NSW IR has been to assist those NSW businesses who had remained within the state system at the commencement of Work Choices (mainly sole traders and partnershps) to transition to the national system. These businesses are fully covered by the national system on 1 January 2011.
In addition, NSW IR continues to provide best practice employment advice via its website and workshop and presentation program, assisting workers and employers in NSW.
In April 2011, the name of the Department of Services, Technology and Administration changed. NSW Industrial Relations is now a division of the Department of Finance and Services.
On 1 July 2012, the branch from the Department of Premier and Cabinet responsible for administering industrial relations policy and advice relating to the NSW public sector became part of NSW Industrial Relations. This branch is known as Public Sector Industrial Relations.
 NSW Government Gazette (Supplement), 4 December 1896, p.8776; note that there is conflicting information about the exact start date of the Department of Labour and Industry – there is some speculation that the Industrial Disputes Act 1912 led to the creation of the Department of Labour and Industry as a stand-alone Government Department in the following year, absorbing the functions of the State Labour Bureau. From 1896 the Government Labour Bureau was the responsibility of the Minister of Public Instruction and Minister for Labour and Industry.
 Department of Labour and Industry (1896-1940) / Department of Labour and Industry and Social Services (1940-1944) / Department of Labour and Industry and Social Welfare (1944-1956) / Department of Industrial Relations, No. 413: http://www.records.nsw.gov.au
 Greg Patmore (ed), Laying the Foundations of Industrial Justice: The Presidents of the Industrial Relations Commission of NSW 1902-1998, The Federation Press, Sydney, 2003, p 54.
 Arbitration Court was in existence from 1902 to 1926, followed by the Industrial Commission from 1926, which was later renamed the Industrial Relations Commission.
 The Government Labour Bureau was renamed the State Labour Bureau in 1905; Schey had earlier been one of the first commissioners appointed to the Labour Commission, see ADB Online: William Schey: http://www.adb.online.anu.edu.au/biogs/A110549b.htm
 Report of the Department of Labour and Industry on the working of Part III of the Factories, Shops and Industries Act 1962, p 14.
 Report of the Department of Labour and Industry on the working of Part III of the Factories, Shops and Industries Act 1962, p 5.
 John Fahey, The NSW Government Programme for Modernising Industrial Relations: Information Paper, November 1989
 New South Wales v Commonwealth  HCA 52; 81 ALR 34; 231. ALR 1 (14 November 2006)