Psychosocial risks (harmful work stress), such as burnout, workplace bullying and trauma exposure, are becoming increasingly serious issues for Australian workplaces. When employers fail to address these risks, the consequences can be devastating, not only for employees but also for the organizations themselves.
Take the case of Ms. Kozarov, a Victorian prosecutor who worked daily with traumatic materials. His employer didn’t recognize the toll this job was taking on his mental health. He developed post-traumatic stress disorder and eventually sued his employer for failing to provide him with a safe workplace. The result? A payment of more than $400,000 in damages.
in a recent case involving Cobar Management Pty Ltd and significant violations of psychosocial risks highlight the urgent need for proactive mental health strategies in the workplace. Two accountants suffered psychological injuries due to excessive workloads, unclear roles, and time zone challenges.
Cobar entered a enforceable commitment with more than $1 million in commitments, including comprehensive surveys and psychometric tests.
This case highlights the importance of identifying and mitigating psychosocial risks early.
Other An example is Court Services Victoria.which faced legal action for exposing employees to high workloads, role conflicts and poor workplace relations. These failures caused significant distress among workers and resulted in a payout of nearly $380,000. These cases highlight how ignoring psychosocial risks can lead to huge financial losses and reputational damage.
What happens when psychosocial risks are ignored?
When psychosocial risks are not managed, the consequences ripple throughout the organization:
- Increase in absenteeism: Employees who experience burnout or distress are more likely to take sick leave or resign.
- Reduced productivity: Stressed workers struggle to perform at their best, which affects overall business performance.
- Legal and financial sanctions: As seen in the cases above, failure to address psychosocial risks can result in costly lawsuits and fines.
- reputational damage: Companies that neglect employee wellbeing risk losing trust between staff and customers.
Quantifying these costs reveals the magnitude of the problem. Unpaid overtime alone costs Australian workers $92.8 billion a year1. For companies, this translates into higher turnover rates and hiring costs, as well as potential legal payments that can reach hundreds of thousands of dollars.
A healthier work culture is possible
Imagine a workplace where employees feel supported and valued, a culture where burnout is rare, and managers are actively involved in preventing psychosocial risks. In such an environment:
- Employees are more productive and motivated.
- Absenteeism decreases as workers feel healthier mentally and physically.
- Legal risks are minimized because proactive measures are in place.
- The organization earns a reputation as an employer of choice and attracts top talent.
By fostering a culture that prioritizes mental health and wellbeing, companies can not only avoid costly legal battles but also unlock greater potential in their workforce.
How to solve the problem
Addressing psychosocial risks requires a proactive approach:
- Identify hazards: Conduct regular assessments to uncover issues such as high workloads, poor role clarity, or harassment.
- Implement control measures: Use evidence-based strategies such as job redesign, clear communication channels, and mental health support programs.
- Train managers: Empower leaders with the skills to recognize signs of burnout or distress and engage in meaningful conversations with employees.
- Monitor progress: Continually review work practices and adjust strategies based on employee feedback.
These steps align with new regulations across Australia requiring employers to actively manage psychosocial risks.
How can I help you
I offer customized solutions to help organizations address psychosocial risks effectively:
- Keynote presentations: CARE OF LARGE EQUIPMENT: Reduce the psychosocial risk of your team (harmful work stress).
- Workshops: Interactive sessions equip teams with practical tools to foster a healthier work culture.
- WeCARE365 Award-Winning E-Learning Programs: Online courses designed to turn knowledge into practical strategies to prevent burnout and distress.
With my experience, your organization can create a safer, more productive environment while staying ahead of legal obligations.
