Skip to main content

Managing psychosocial hazards

Creating resilience and performance for people and organisations

March 20, 2023

Beyond regulatory obligations, learning how to manage psychosocial risks will help your organisation improve performance through a healthier, more productive and engaged workforce.
Workplace Risk

Your organisation directly benefits when employees are thriving; they take fewer sick days, have lower rates of burnout and turnover and deliver high performance. Many organisations however are struggling, to manage psychosocial risks effectively.

Psychosocial hazards are factors in the design or management of work that increase the risk of work-related stress, common examples include emotional demands, workload, poor organisational support, social exclusion, bullying, harassment, isolated work, violent or traumatic events and lack of job control.

The impact of mental illness and ill-health in the workplace has never been more visible1.

  • A survey of Australian workers revealed that 91% of Australian workers consider it important to safeguard psychological health in the workplace.
  • Despite this, approximately half of the employees surveyed believe that their workplace is not mentally healthy.
  • One in five Australians (21%) have taken time off work in the past 12 months because they felt stressed, anxious, depressed or mentally unhealthy. This statistic is more than twice as high (46%) among those who consider their workplace mentally unhealthy.

A changing political landscape

While employers have always had a primary duty of care to ensure the health and safety of their workers (including psychological health), the political landscape is changing with greater emphasis on psychosocial hazards. This has continued to evolve following the 2018 review of the Model Work Health and Safety Regulations conducted by Marie Boland. Specifically, Ms Boland recommended additional guidance around the identification and control of psychosocial hazards.

Following these recommendations, in June 2022 there were changes to the model laws to incorporate the management of psychosocial risks. In particular, these require the Person Conducting Business or Undertaking (PCBU) to:

  • so far as is reasonably practicable, ensure workers and other people in the workplace are not exposed to psychosocial hazards
  • adopt a risk-based approach to managing psychosocial hazards (identify hazards, assess the risk, implement controls and review the effectiveness of any controls)
  • to eliminate psychosocial risks in the workplace, or if that is not reasonably practicable, to minimise these risks so far as is reasonably practicable.

The changes are currently being implemented across most states and territories. New South Wales formally adopted them, effective from 1 October 2022 within the Work Health and Safety Regulation 2017 (NSW). Western Australia has included them in the Work Health and Safety Regulation (General) 2022, from December 2022. Queensland has also recently passed the Work Health and Safety (Psychosocial Risks) Amendment Regulation 2022 (QLD) and changes will be adopted as law from 1 April 2023. Very recently, the Northern Territory has also made commitments to release amendments to the Work Health and Safety (National uniform legislation) Regulations which will be enforceable from 1 July 2023.

We anticipate that other states and territories will follow shortly. Victoria is the only state that is not part of the harmonised scheme but has, however, committed to making changes to the Occupational Health and Safety Regulations 2017 (Vic) to include amendments addressing psychosocial risk. Proposed amendments have been released in the Occupational Health and Safety Amendment (Psychological Health) Regulations.

Across the different states and territories, regulators are already out and enforcing these laws and we expect that this attention is only going to increase.

Why do most interventions fail?

Despite the prevalence of mental illness, many organisations fail to adopt an evidence-based approach that applies a risk-management framework. There is an ongoing reliance on reactive management practices, that aim to help employees cope better with workplace stressors. Given these initiatives do not seek to modify the level of risk, they are not enough to meet legislative obligations, and to protect the people within our workplaces.

While supporting those in distress and those with mental illness is essential, there is more that can be done to protect against harm. In fact, evidence supports the adoption of an integrated approach that enables employees to get well (support recovery), stay well (intervene early), and be the best they can be (prevent harm and promote general health and wellbeing).

So, how can you proactively manage risk in a way which is meaningful for your people, meets your legal obligations and benefits your organisation?

Targeted solutions for psychosocial risks

By actively listening, WTW builds a deep understanding of your organisation’s psychosocial risk profile, to create targeted solutions.

Establishing commitment

Building a strong foundation for change is a fundamental to ensuring long-term viability. Three preparatory steps are recommended to maximise the impact: construct a strong business case, gain leadership support, and gain employee support.


A high impact communication strategy is essential. This must signal a clear and visible commitment from the leadership team.

Risk management process

Once the business case has been established and stakeholders are engaged, WTW adopts a risk management approach using the following framework:

WTW risk management approach.
WTW risk management framework
  1. 01

    Identify hazards

    Identifying psychosocial hazards and risks within your business brings transparency to areas that require attention. This enables us to reduce work-related stress at the root cause and helps us develop impactful measures to control risks. Our data-driven analytics and consultation with the workforce through targeted focus groups helps us to identify critical risks across the employee lifecycle.

  2. 02

    Assess the risk

    Our validated psychosocial risk assessment tools allow us to not only assess the objective stressors, but helps to gain feedback about working conditions, job resources and job demands. We can customise the digital questionnaire to suit the needs of your organisation, with the aim of making your employees feel heard.

  3. 03

    Identify and implement controls

    Through our assessment tools, you will develop a deeper understanding of your organisation’s ‘baseline’ activities and where you need to focus your attention. Our heat map assessment tools help you understand the maturity of activities you have in place to prevent illness, mitigate the harm, and support recovery. This helps us build an integrated strategy for your organisation. Our ease and impact score will help you prioritise what requires the most urgent attention and what course of action will be most effective.

    Finally, we can offer support during implementation so that your efforts lead to success. Our solutions are evidence-based and tailored to the risk profile of each organisation. People, objective data, and research are at the forefront of every unique program we develop and deliver. Because our solutions are tailored, we get traction and make a sustainable difference.

  4. 04

    Review and improve

    Reviews are carried out to monitor and measure the progress of the initiatives from baseline. Regular reviews provide you with valuable insights into trends within your business, tracking your progress. Our review process also allows you to identify new hazards and alter your strategy – being intentional with your actions. Only through these activities can you successfully manage psychosocial risks systematically resulting in continuous improvement. In doing so, you will meet your legislative obligations and improve organisational performance through a healthier, more productive and innovative workforce.

Benefits to your organisation and your employees

Investing in employee wellbeing can make a business more profitable. Research reveals for every dollar a business owner invests in a company-wide wellbeing initiative, they can expect to see a return in investment of up to 2.3 times2. It is therefore not surprising that wellbeing and economic growth are interdependent and mutually reinforcing.

We spend more time at work than anywhere else, which is why we must make it a place where people feel safe, valued and supported.

Employee benefits and their impact on organisations

Employee benefits and their impact on organisations
Employees Organisations
Improved morale Improvement in organisational culture and client satisfaction
Job satisfaction Higher retention and lower recruitment cost
Motivation High-quality work
Psychological safety (employees feel safe to speak up without fear of retaliation or humiliation) High performance teams, creativity, innovation and organisational resilience
Improved health outcomes Fewer employee absences, presenteeism and costly claims thereby increasing profitability

Why WTW?

  • Evidence-based solutions: we provide quick, easy, economical and anonymous tools.
  • Expertise and experience: we know what to keep in mind and what leads to success.
  • Trusted advisors: we are at your side to answer questions and offer support.


1 Beyond Blue. (2014). State of Workplace Mental Health in Australia.

2 PWC. (2014). Creating Mentally Healthy Workplaces, Return on Investment Analysis.

For any further information, please contact

Anna Klease
Prevention Director | Workplace Risk Practice

Contact us