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SHR News - Psychosocial Hazards and Code of Practice

What you need to know about the new Psychosocial Hazards Code of Practice

In line with Australian Workplace Health and Safety laws, employers are required to take all reasonable steps to prevent harm arising from work. Until recently, the focus has primarily been on physical risks, but as of April 1st, 2023, a new Code of Practice has been implemented to manage 'psychosocial hazards.' With its introduction, it's essential for business owners to adapt to these changes and ensure the wellbeing of their employees while fostering a productive and positive work environment.

Each year mental illness costs Australian workplaces $4.7 billion in absenteeism, $1.6 billion in presenteeism and $146 million in compensation claims. The addition of COVID-19 impacting the mental health and wellbeing of employees means employers must adapt to the mental health needs of the workplace and these include Psychosocial Hazards. Now more than ever, employers are needing to shift their mindset to accept the growing prevalence of mental illness in the workplace and strengthen the leadership response and culture towards employee wellbeing.

What is a Psychological Hazard?

When it comes to work, psychosocial hazards are those workplace factors that can negatively impact a worker's health and wellbeing. Basically, they're the things that create stress and make it harder for an employee to handle their job effectively. Examples of psychosocial hazards include:

  • Exposure to traumatic events, i.e. reading, hearing or seeing accounts of abuse or neglect.

  • Violence and aggression, i.e. from other workers, customers, or members of the public.

  • Bullying and harassment, i.e. repeated unreasonable behaviour.

  • Lack of role clarity i.e. conflicting or changing responsibilities and expectations.

  • Job demands, i.e. sustained high or low levels of physical, mental or emotional effort, unreasonable or excessive time pressures.

  • Work design, i.e. highly repetitive tasks.

  • Poor organisational change management, i.e. insufficient information, consultation, training or support during times of change.

If addressed appropriately employers can create a healthier and more resilient workforce and positively influence employees’ mental health, psychological safety and engagement.

If these factors are not managed appropriately, they have the potential to lead to psychological and/or physical injury.

What does the new code mean?

The code sets out legal obligations and provides guidelines on how business can comply with health and safety requirements. These new obligations will require businesses to proactively address mental health and wellbeing in the workplace.

Every business faces situations that impact the mental health of its employees, and it's crucial to actively intervene and oversee these issues. Unfortunately, many managers lack the knowledge and understanding to recognise such situations or respond appropriately. When psychosocial risks are mismanaged, it can result in inconsistent performance and productivity, difficulties in maintaining a workforce, high staff turnover, dysfunctional teams, grievances, and even legal disputes.

Steps you can take to manager psychological risks

To meet your obligations to provide a healthy and safe environment to your team, you must eliminate or minimise psychosocial risks so far as is reasonably practicable. To achieve this, just as for any other hazard, you can apply the following risk management process.

If you are looking for a simple place to start, we suggest that you:

  1. Review policies and procedures to ensure they promote wellbeing and create a supportive environment where employees feel comfortable raising concerns or disclosing mental illness.

  2. Look to provide an Employee Assistance Program or promote external support services to those who may not feel comfortable openly discussing their mental health concerns.

  3. Offer training and coaching to managers so they are aware of the signs of mental health and other psychosocial hazards.

  4. If you have First Aid Officers, ensure their training includes mental health first aid as well.

  5. Schedule regular meetings with managers to discuss work goals, objectives and enable two-way feedback on the work environment.

  6. Do not overcomplicate or over-commit to control measures simply because it looks good on paper. The key is identifying practical, simple strategies that actually make a difference!

Prioritising mental health in the workplace is more important than ever before. By reviewing the code, addressing psychological hazard and implementing control measures businesses can create a healthier and more productive work environment.

If you require support and guidance in implementing psychosocial wellbeing initiatives in your workplace please reach out to a Streamline HR Consultant.


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