Under the Work Health and Safety Act 2011, a person conducting a business or undertaking (PCBU) has a primary duty to ensure, so far as reasonably practicable, both the physical and psychological health and safety of their workers.
Previously, the management of psychosocial risks has been unregulated Australian workplaces. However, with the rising frequency and costs of psychological injuries, and after multiple WHS legislation reviews, State and Territory Ministers have committed to introducing regulations across Australia to elevate psychological health and safety to the same level as physical health and safety.
These new regulations recognise that hazards that pose a risk to psychological health and safety (psychosocial hazards) are just as harmful to workers as physical hazards are. They will also provide clearer guidance to employers on their obligations to better protect workers from mental illness and injury.
In June 2022, SafeWork Australia amended the Model Work Health and Safety Regulations to include the management of psychosocial risks. Later in July, they released a Code of Practice on managing psychosocial hazards at work, which provides practical guidance on how to identify and manage psychosocial risks and achieve the standards required under the regulations. It is now up to the individual states and territories to adopt these changes into their WHS legislation.
On October 1, 2022, NSW became the first state to adopt new WHS regulations, which require businesses to implement control measures to manage psychosocial risks. Queensland have also announced their commitment to adopt the same regulations on 1 April 2023.
As an employer you will be required to manage psychosocial hazards in your workplace, the same as you currently must do for physical hazards.
To do this you will need to follow a systematic approach, in consultation with staff, to identify psychosocial hazards, assess and prioritise the risks, develop and implements control measures and regularly review the effectiveness of these controls.
At Healthy Business, we understand that the proposed changes and the associated costs may be a challenge for businesses. However, it is important to note that the potential benefits of establishing a mentally healthy workplace are substantial, for both your people and your business.
In comparison to other injuries, psychological injuries can be some of the costliest. According to SafeWork Australia statistics, the average cost of a mental injury claim has risen 22% in the last decade, reaching $46,400 in 2018-19. This was more than three times the average amount for all other serious claims ($14,500). This is largely due to the fact that the time of recovery is much longer, with claims of a psychological nature having an average duration of 26.6 weeks in 2018-19, compared to 7.3 for all other claims. 
Additionally, poor mental health can negatively impact on a person’s performance, productivity and attendance at work. The Productivity Commission estimated that absenteeism and presenteeism from mentally ill-health are costing Australian workplaces approximately $17 billion each year. 
On a positive note, a Regulatory Impact Statement prepared by Deloitte found that the effective management of psychosocial hazards could exceed the costs for Australian workplaces at a ratio of 1:1.06. This is due to the benefits from improved productivity from lower absenteeism and presenteeism, and reduced compensation claims and occurrence of employee mental illness and injury. 
If you would like some help to navigate this process to meet your obligation and keep your people safe from psychological injury and illness, get in touch with our team today.
1. Marie Boland 2018, Review of the model Work Health and Safety laws Final report, <https://www.safeworkaustralia.gov.au/system/files/documents/1902/review_of_the_model_whs_laws_final_report_0.pdf>
2. Australian Government Productivity Commission 2020, Productivity Commission inquiry report: Mental health volume 2, <pc.gov.au>
3. Australian Government Attorney-General’s department 2021, Work Health and Safety — Ministers’ Meetings, 20 May 2021, <https://www.ag.gov.au/industrial-relations/publications/work-health-and-safety-ministers-meetings>
4. NWS Government SafeWork NSW 2021, Code of Practice Managing Psychosocial Hazards At Work, https://www.safework.nsw.gov.au/__data/assets/pdf_file/0004/983353/Code-of-Practice_Managing-psychosocial-hazards.pdf https://www.commerce.wa.gov.au/sites/default/files/atoms/files/221154_cp_psychosocialhazards.pdf
5. Victorian Government, Proposed OHS Amendment (Psychological Health) Regulations, 2022, https://engage.vic.gov.au/proposed-psychological-health-regulations
6. Safe Work Australia, Australian workers’ compensation statistics 2019-20, <https://www.safeworkaustralia.gov.au/doc/australian-workers-compensation-statistics-2019-20>
7. Productivity Commission, Mental Health Productivity Commission Inquiry Report, (Inquiry No 95, 30 June 2020) <https://www.pc.gov.au/inquiries/completed/mental-health/report/mental-health.pdf
8. Deloitte, Occupational Health and Safety (Psychological Health) Regulations Amendment 2022, Regulatory Impact Statement, WorkSafe Victoria, January 2022, < https://engage.vic.gov.au/download/document/23765>