The challenge

Post-COVID, managing psychological risks and mental health has become a serious concern for business owners, big and small. The latest research by organisations like and AIHW shows that 1 in 5 people take time off work due to mental health and 92% of employees feel that mental health first aid and response is a very important issue. Most alarming is the fact that a whopping 48% of employees feel their workplace is a mentally unsafe place to work. This growing issue is a real challenge with mental health support and recovery costs to Australian businesses at $10.6B in 2018-19 which has been increasing by 1.5% each year since 2014. We would define this as the biggest and most challenging issue to be managed by businesses in the future.

Contributing factors

These include changes in OHS and Discrimination legislation, the @respect at work recommendations, and the increasing popularity of hybrid and remote work arrangements. If your business isn’t taking steps to safeguard employees against psychological risks, you are likely opening yourself up to nasty legal action or stress claims.

So what are psychological risks?

Psychological risk is the possibility of a psychological injury occurring when exposed to a hazard. Hazards from a psychological perspective are situations or factors that could increase the likelihood of employees experiencing a stress response – essentially a physical, mental or emotional reaction in your workplace.

You can see where this gets tricky. Managing risks or hazards in the past used to focus on assessing physical risks like trip hazards or dangerous work conditions; now, we are trying to assess largely unseen risks that are harder to define and almost impossible to monitor.

This is because psychological risks are often caused by unseen work-related stressors including:

  1. Bullying or workplace harassment
  2. Poor job clarity
  3. Long hours
  4. Tight deadlines
  5. Demanding clients
  6. Aggressive or overbearing managers or management practices
  7. Unrealistic deadlines or expectations
  8. Poor workplace conditions (such as low pay and unsavoury or dirty work)
  9. Sheer nature of the work (think paramedics, police officers or any other stressful workplaces)

According to Work Safe, if someone makes a Workcover claim for stress, any contributing factors found in the workplace, including all of the above, will lead to the employer being found responsible for the psychological injury. In a recent case, we managed for a client; an employee claimed that a Manager had kept them waiting when they had a meeting with them, which caused them to experience workplace stress, and their claim was accepted. As you can see, the bar is extremely low, so focusing on the mental health of your employees should be a priority for all leaders and businesses.

Top tips for managing psychological risk

Suppose your employees are regularly exposed to these sorts of stressors. In that case, it’s important to take all reasonable steps to mitigate the risk of psychological harm at all costs. This is no longer just a “nice to have” or “something that big corporates do”.

Creating a safe and supportive workplace to manage mental health is probably one of the most important things you can do to prevent psychological harm in your workplace.

Here are some of our top tips:

  • Educate yourself and your employees about mental health and psychological risks.
  • Be open to talking about mental health in the workplace.
  • Encourage employees to seek help if they’re struggling.
  • Provide support and resources for employees who are struggling with mental health. This could include EAP & Wellbeing services.
  • Create a workplace culture that promotes psychological safety through awareness training.
  • Deal with performance issues immediately to avoid things slipping into stress claim territory (if you need help, then give us a call)

Do’s and Don’ts of managing employees with mental illness.

This is a highly complicated and sensitive issue, and it’s not surprising that many employers are confused about what they can and can’t do when managing employees who have declared mental illnesses.

What we know now is that the Proposed OHS Amendment (Psychological Health) Regulations will only be applicable in Victoria at this stage. Still, there is no harm in using this as a template for how you manage and mitigate psychological risks in your business.

One of the things that employers will have to consider is whether they can make reasonable adjustments for the employee with a mental illness. These would include adjustments to the work environment, workload and hours and the nature of work. The law states that generally, an adjustment to an employee’s duties would be reasonable unless making the adjustment will cause unjustifiable hardship. The way that this is determined is pretty broad. Still, things to consider would be the financial burden to the employer, the benefit to the employee and whether the employer can access any support.

To sum it up…

Mental health and wellbeing initiatives are no longer just buzz words that are a nice to have. Employers are going to need to adopt reduction strategies through Promotion, Prevention and Early Intervention (PPEI). Trust, awareness and skilled response are the key factors to effective PPEI. We proudly work with Sharetree who provide an Emotional Pulse Program service that uses cutting edge technology and a certified training solution that builds emotional awareness, transparency, capability and trusted connections between people, leaders, skilled first responders and professional support through technology, training, reporting and artificial intelligence. The technology and training are all psychologist approved services and practical in their application. This program can also be government funded. We are actually running a FREE webinar on this topic if you would like to learn more click here.

We know this is a complicated topic, and if you have any questions or need assistance creating a safe and supportive environment for your employees, please don’t hesitate to contact us and we can discuss how we can help get your business ready to manage this massive risk.

Written by Head Guru – Emily Jaksch

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