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Managing psychosocial hazards to support employee wellbeing and retention

By Rebecca Forster | July 28, 2023

We consider legislation, principles and standards such as ISO45003 around shaping proactive approaches to psychosocial risk management to boost worker wellbeing, recruitment and retention.
Work Transformation|Risk Management Consulting|Benessere integrato

You probably have a good understanding of the risks to your workers’ physical health at work. Manual handling, slips, trips and falls, driving for work and fire risks are just a few physical hazards your organisation may be managing with policies, procedures, training and control measures.

However, you may not have the same risk management measures in place for psychological health and safety risks, known as psychosocial hazards. If this is the case, you could be leaving your people, and your business, exposed.

We all have mental health. Just like our physical health, we need to take care of our mental health and employers need to prioritise health and safety around psychosocial hazards just as they do for physical hazards.

This may involve shifting perspectives from a mindset that sees ‘worker mental health’ as primarily concerned with addressing the mental ill-health of individual workers, and shifting instead to whole-of-organisation approaches.

So, in this insight, we provide a summary of the law and frameworks for best practice to better protect your people and the business from psychosocial hazards.

Legislation on managing psychological health and safety and stress

The Health and Safety at Work Act 1974 stipulates organisations must take care of the health and safety of their people, and this includes psychological health and safety and stress arising from work-related factors. If your organisation does not have an organisational stress risk assessment in place, which you regularly review, you may be in breach of the Management of Health and Safety at Work Regulations 1999.

You should also remember you’re legally obliged to make reasonable adjustments if an individual is covered under the Equality Act (where a worker’s symptoms have more than a minor adverse impact on their ability to carry out their day-to-day activities which is likely to be long-lasting). You should develop these adjustments in consultation with workers. Adjustments could include:

  • Flexible working
  • Additional support
  • Time off to attend counselling or medical appointments
  • Amended duties.

But the imperative to act on managing psychosocial hazards is not only legal.

Not taking action to prevent, manage and support workers experiencing stress and poor mental health could be having a sizeable impact on your bottom line. Presenteeism (people working while ill), absence and employee turnover costs U.K. employers up to £53- £56billion.

We’d also argue there’s a moral imperative. In 2021, there were 5,219 suicides in England. For context, this compares with an estimated 1,558 reported road traffic fatalities. We believe organisations have a significant role to play in helping address this and the wider-ranging impacts of managing mental health risk.

The business impact of psychosocial hazards

Psychosocial hazards are work-related factors which typically include lack of control, poor supervision, customer violence and aggression, and high demands that can affect workers emotions, behaviours, biochemical and neuro-hormonal reactions.

The business risks of your workers being exposed to psychosocial hazards can be far-reaching and can include:

  • Poor concentration and lack of focus resulting in mistakes, incidents, errors, omissions, lost creativity and cyber risks
  • Conflict with colleagues and mood swings, which may increase grievances, contributing to low morale and cases of bullying and harassment
  • Absence that may have financial implications for employers and could result in stress claims or issues arising from disability discrimination if not well managed
  • Individuals leaving work as a result of poor mental health or stress, which may affect an organisation’s reputation and can be costly when you consider lost knowledge and hiring costs, particularly given rising labour shortages in some industries.

The impact of these hazards can lead to a range of consequences and can expose your organisation reputational and legal risks, including personal injury claims.

How to manage mental health risks at work

Preventing poor mental health at work is about managing psychosocial risks in the workplace, with the World Health Organisation recommending taking action to:

  • Prevent risks to mental health at work
  • Protect and promote mental health by strengthening manager capabilities
  • Support people with mental health conditions to thrive at work.

Your business can also manage psychosocial risk by applying best practise such as the guidelines set out in ISO45003, the first occupational health and safety management system for mental health at work.

For WTW, the core principles you need to create positive work environments and promote worker wellbeing are summarised under the following framework:

Prevention and participation

Prevention and participation

This is about undertaking risk assessments to identify hazards, preventing harm where reasonably practicable, and consulting with workers.



This refers to ensuring managers are competent in supporting their teams with empathy, can manage and mitigate work-related stress and have regular check-ins with their people.



This concerns senior managers, owners and directors leading from the top to create a culture of genuine care, concern and psychological safety.



This refers to ensuring awareness of what psychosocial hazards are, what control measures are in place, and how to access support.

Culture, commitment and communication

Culture, commitment and communication

This is about having a whole-of-organisation approach to protecting and promoting worker wellbeing at every stage of the employee journey in an inclusive, collaborative manner.

Take action

Take action

This crucial element is focused on introducing effective control measures, continuous monitoring, measurement and improvement.

Education to manage mental health risk

Underpinning effective psychosocial risk management and protecting worker wellbeing is the need for education to address misconceptions and the resulting stigma surrounding stress and mental health. Organisations doing this successfully embed the realities around mental health into their culture, regular training from the time of onboarding, and policies and procedures. These realities include that:

  • Mental health is not just mental illness, we all have it
  • We are all likely to experience poor mental health from time-to-time
  • We are all vulnerable to developing mental illness at some point in our lives
  • Chronic stress can impact overall health
  • People can and do recover from mental health issues
  • Suicidal thinking is common and suicidal behaviour is preventable
  • Individuals experiencing mental illness will not always require time off work.

Whole-of-organisation approaches to psychosocial risk

Businesses that successfully manage worker wellbeing and psychosocial risks understand they need to adopt a whole-of-organisation approach that’s focused on treating employees as individuals, preventing harm and creating a culture in which their employees can thrive.

Whole-of-organisation approaches are analogous to watering and nourishing the soil in which plants grow, rather than treating individual organisms for specific conditions. Similarly, just as you don't wait until someone has a back injury before talking about manual handling, often unknowingly, you could be exposing your employees to conditions that harm their psychological health on a daily basis.

Signs organisations are not adopting genuine whole-of-organisation approaches to employee wellbeing include, for example, high absence, turnover or poor worker relations. In cultures where high levels of stress have become normalised there may also be issues concerning ‘behavioural safety’ which increases the risks of accidents, errors and omissions. It’s also worth saying that only offering workers gestures related to their wellbeing, rather than well-considered policies and resources, may also leave the business open to ‘wellbeing washing’ claims, where its alleged stated attitudes around managing mental health and stress at work don’t match the realities. For example, running schemes like ‘free fruit Fridays’ and only talking about mental health during mental health awareness week but not investing in line manager training to spot the signs of stress and manage psychosocial hazards.

Opportunities of effective psychosocial risk management

Managing psychosocial risk effectively is not only about minimising damage but maximising opportunities for employees to thrive and in turn improving recruitment and retention. Organisations with a demonstrable and robust approach to worker wellbeing and total rewards are more likely to compete for the loyal workers they require to deliver high quality services and operations and the talent they need for longer-term success.

For specialised support on finding smarter ways to address psychosocial hazards and manage worker wellbeing, get in touch.


Stress and Mental Health Risk Specialist
Health and Wellbeing

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