Unions have forecast a fresh round of confrontation with the NSW government over its contentious workplace reform agenda.

The warning came as hundreds of public sector workers marched through Sydney yesterday as part of national May Day rallies promoting workers' rights.

The march was the latest in a series of high profile events directly addressing the workplace reform agenda launched by the NSW Coalition government last year.

Among changes since taking office in March 2011, the state government has introduced a 2.5 per cent cap on public sector wages, stripped powers from the Industrial Relations Commission and restricted police compensation payouts.

Premier Barry O'Farrell has also foreshadowed an overhaul of the WorkCover compensation program.

Fire Brigade Employees' Union secretary Jim Casey said: ''He [Mr O'Farrell] is treating public servants like chattels, he's locked in below-inflation wage rises, he's gutted the industrial courts and really he's cruising for a fight.

''So we're prepared to give it to him.

''I'm hoping it won't come to that. But certainly the way it's running at the moment there's bound to be some more confrontation between the state government and the public sector unions.''

NSW Construction, Forestry, Mining and Energy Union secretary Brian Parker said he was concerned about attempts to slash his members' injury compensation.

''We have one death per week in this country and obviously that is a big burden on families and a burden on society in general,'' he said. ''Slashing compensation benefits for workers is not the way to go forward in this country.''

Mr Parker also predicted further confrontation with the state government over the issue.

Hundreds of unionists and workers also rallied in Melbourne to mark international workers' day. AAP