diff --git a/pkg/cvo/cvo_scenarios_test.go b/pkg/cvo/cvo_scenarios_test.go
index e672a466b0..a4aaebaf17 100644
--- a/pkg/cvo/cvo_scenarios_test.go
+++ b/pkg/cvo/cvo_scenarios_test.go
@@ -1886,7 +1886,7 @@ func TestCVO_UpgradePreconditionFailing(t *testing.T) {
 		t.Fatal(err)
 	}
 	actions = client.Actions()
-	if len(actions) != 1 {
+	if len(actions) != 2 {
 		t.Fatalf("%s", spew.Sdump(actions))
 	}
 	expectGet(t, actions[0], "clusterversions", "", "version")
@@ -2016,7 +2016,7 @@ func TestCVO_UpgradePreconditionFailing(t *testing.T) {
 	expectUpdateStatus(t, actions[1], "clusterversions", "", &configv1.ClusterVersion{
 		ObjectMeta: metav1.ObjectMeta{
 			Name:            "version",
-			ResourceVersion: "3",
+			ResourceVersion: "4",
 			Generation:      1,
 		},
 		Spec: configv1.ClusterVersionSpec{
diff --git a/pkg/cvo/sync_worker.go b/pkg/cvo/sync_worker.go
index 7f55901b16..485c41cf1a 100644
--- a/pkg/cvo/sync_worker.go
+++ b/pkg/cvo/sync_worker.go
@@ -406,11 +406,8 @@ func (w *SyncWorker) Update(ctx context.Context, generation int64, desired confi
 		oldDesired = &w.work.Desired
 	}
 
-	w.work = work
-
-	if !versionEqual && oldDesired == nil {
-		klog.Infof("Propagating initial target version %v to sync worker loop in state %s.", desired, state)
-	} else if !versionEqual && state == payload.InitializingPayload {
+	// since oldDesired is not nil this is not the first time update is invoked and therefore w.work is not nil
+	if !versionEqual && oldDesired != nil && state == payload.InitializingPayload {
 		klog.Warningf("Ignoring detected version change from %v to %v during payload initialization", *oldDesired, work.Desired)
 		w.work.Desired = *oldDesired
 		if overridesEqual {
@@ -425,6 +422,13 @@ func (w *SyncWorker) Update(ctx context.Context, generation int64, desired confi
 		return w.status.DeepCopy()
 	}
 
+	if !versionEqual && oldDesired == nil {
+		klog.Infof("Propagating initial target version %v to sync worker loop in state %s.", desired, state)
+	}
+
+	// update work to include desired version now that it has been successfully loaded
+	w.work = work
+
 	// notify the sync loop that we changed config
 	if w.cancelFn != nil {
 		klog.V(2).Info("Cancel the sync worker's current loop")