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Managing psychosocial hazards at work: Employer’s guide to the risks you can’t see

12 October 2022

11 min read

#Workplace Relations & Safety

Published by:

Aiyana O’Meara

Managing psychosocial hazards at work: Employer’s guide to the risks you can’t see

In this article, we explore recent developments in the work health and safety space with respect to managing psychosocial hazards and risks at work. We discuss below:

PCBUs asked to go further to address psychosocial risks to health and safety

Employers are increasingly expected to provide a psychologically safe workplace and recent developments signal a future in which Australian employers will face criminal prosecution for failing to adequately protect employees’ mental health.

The World Health Organisation has recently released guidelines on mental health at work, providing global public health guidance on interventions to promote positive mental health and prevent mental health conditions.

In Australia, the responsibility for employers may be taken further following the publication of Safe Work Australia’s new model code of practice, Managing Psychosocial Hazards at Work, released in July this year (Model Code).

In this article, we address what the Model Code would require of a PCBU to manage psychosocial hazards in the workplace.

What is the Model Code?

All states and territories except Victoria have implemented ‘model’ work health and safety laws aimed at harmonising different jurisdictions. For the laws to be legally binding however, the Commonwealth, states, and territories must implement them as their own federal and state laws. 

The model laws follow the general framework of:

  • an overarching Work Health and Safety Act (WHS Act), which imposes broad work health and safety duties on various parties or roles within a business
  • a corresponding WHS regulation, which supplements the WHS Act with more specific duties
  • approved codes of practice, which provide practical guidance on how to comply with WHS duties tailored to particular risks or industries.

The Model Code comes off the back of a 2017 review of the model laws (the Boland review), which amongst other matters, identified a failure to provide any specific requirements or practical examples of how to comply with WHS duties in respect of psychosocial hazards at work. There was no dispute that psychological health and safety should be ensured.

Psychosocial hazards

Psychosocial hazards are hazards that may cause psychological harm, and arise from or in relation to:

  • the design or management of work;
  • the working environment;
  • plant (i.e. machinery or equipment) at a workplace; or
  • workplace interactions or behaviours.

Psychosocial hazards can then generate a psychosocial risk, being a risk to a person’s health or safety arising from a psychosocial hazard.

Unsurprisingly, many facets of work could qualify as a psychosocial hazard. This may include job demands (involving sustained high or low levels of physical, mental or emotional effort), low job control, remote or isolated work, and exposure to traumatic events. 

Perhaps more unpredictable for PCBUs is the possibility of psychosocial hazards arising from the management of a person’s employment. This may include poor support, lack of role clarity, poorly managed organisational change, inadequate reward and recognition (where there is an imbalance against a worker’s effort), and poor organisational justice.

All of these examples are taken from the Model Code.

What does the Model Code require?

Put simply, the Model Code requires no more than the general model framework of managing any other WHS risk. What is significant however, is how the Model Code applies this framework to managing psychosocial hazards. We set out what employer must do below.

1. Identify the psychosocial hazard(s). Employers must proactively identify work aspects or situations that could potentially harm workers or others in the course of conducting the business or undertaking. 

The Model Code not only provides highly detailed examples of common psychosocial hazards, but also provides how novel hazards could be identified. These methods include simply observing the workplace (e.g. for isolated workers), the quality of work (as rushed or delayed), or how people interact with each other (noting harmful behaviours).

2. Assess the risks to health and safety. Where a psychosocial hazard exists, this creates a risk. A risk assessment should be done to identify the workers or others affected, taking into account the duration, frequency and severity of their exposure to the hazard (or hazards). 

In a psychosocial context, the Model Code provides examples of these considerations to include whether an incident was particularly traumatic (for severity), whether tasks are regularly performed without adequate support (for frequency), or whether high job demands are prolonged over weeks or months (for duration).

3. Controlling the risks. Once psychosocial hazards are identified and the risks are assessed, an employer is in a position to control the risks. If it’s reasonably practicable to do so, the risk must be eliminated.  If it’s not, the risk must be minimised as far as reasonably practicable. 

Workplace policies provide an effective measure for directly managing workers’ behaviour (and the risks that may arise from that), as well as encouraging compliance with an organisation’s systems and practices (which may even be directed towards managing the risks from other psychosocial hazards). 

A workplace policy however, will not cure all ills. In relation to high cognitive job demands for example, an organisation could consider providing quiet workspaces for mentally demanding work, implementing appropriate automatic systems to reduce human error, providing additional support, or even a combination of these measures.

4. Reviewing the control measures. Employers should regularly review the effectiveness of the control measure(s) implemented to ensure they are working as intended.

Status of the Model Code

Before the Model Code, NSW already had a code of practice for managing psychosocial hazards at work, based on earlier guidance material released by Safe Work Australia. Shortly after the Model Code, Western Australia implemented its own codes of practice, but adopted the work of its interstate counterpart instead.

The Model Code itself has not yet been approved by any jurisdiction. At the time of writing, NSW had recently implemented the connected amendment to its WHS regulation, operative from 1 October 2022 (see the article below).

Key takeaways

The Model Code is not binding law in any jurisdiction, but in the meantime, it should not be ignored. Employers are already at risk of direct civil liability for failing to safeguard their employees from work-related psychiatric injuries, and the High Court provided a timely reminder of that earlier this year. The Model Code however, signifies a step towards criminal WHS prosecutions for these types of failures and if this does become a reality, it will represent a huge change in the regulation of Australian workplaces.

For example, if a PCBU has a bully in the workplace and they do nothing to eliminate this ‘hazard’, it is a logical step, even under the existing WHS legislation, that the PCBU could face criminal charges should a worker suffer a severe psychiatric injury as a result of the bully’s activities.

Should the Model Code be approved (and so effectively, adopted), it would not only provide employers with practical guidance towards ensuring health and safety against psychosocial hazards, but also, provide substance to any prosecution for the failure to do so. In Queensland, employers are required to comply with an approved code of practice and in other model jurisdictions, a court can have regard to an approved code to determine what measures were reasonably practicable.

New requirements in NSW to manage psychosocial risks in their workplace

Changes to safety legislation in NSW from 1 October 2022 mean that employers must now ensure they manage psychosocial risks in their workplace in accordance with new regulations.

Following the recent changes to the national model WHS Regulations (Model Regulations) in June 2022, NSW, as the first state or territory in Australia, has now adopted an explicit requirement for PCBUs to manage psychosocial risks in the workplace and to implement control measures to minimise, if not eliminate, these risks.

The changes

The Work Health and Safety Regulation 2017 (NSW) (NSW Regulation) has been amended to include the new definitions of “psychosocial hazard” and “psychosocial risk” from the Model Regulations (see the article above).

The NSW Regulation then imposes a positive duty on PCBUs to manage psychosocial risks in the same way as other risks in the workplace and to implement control measures.

Importantly, while the NSW Regulation does not require the adoption of the hierarchy of control measures (clause 36), the NSW Regulation provides a list of factors that must be considered when determining the control measures to implement, including the following:

  • the duration, frequency and severity of the exposure of workers and others to the psychosocial hazards
  • how the psychosocial hazards may interact or combine
  • the design of work, including job demands and tasks
  • the systems of work, including how work is managed, organised and supported
  • the design and layout, and environmental conditions of the workplace, including the provision of:
    • safe means of entering and exiting the workplace, and
    • facilities for the welfare of workers.
  • the design and layout, and environmental conditions of workers’ accommodation
  • the plant, substances and structures at the workplace
  • workplace interactions or behaviours
  • the information, training, instruction and supervision provided to workers.

What does this mean for employers?

The changes to the NSW Regulation mean that employers in NSW are now explicitly required to manage psychosocial risks in their workplace as well as physical risks. The psychosocial risks must be managed by implementing relevant control measures, having regard to the very broad factors as provided by the new provisions, such as the design of the workplace that can impact the mental health of workers. A failure to address this requirement may result in a breach of a PCBU’s duty and penalties may be imposed on both the PCBU and its officers.

While the new provisions have only recently commenced on 1 October 2022, the requirement to manage psychosocial risks is not new.

Under the Work Health and Safety Act 2011 (NSW) (Act), a PCBU has a primary duty to, so far as is reasonably practicable, ensure the health and safety of workers and that any other individuals are not put at risk to health and safety. The Act defines ‘health’ as “physical” and “psychological” health.

Further, last year SafeWork NSW developed and published its own Code of Practice – Managing Psychosocial Hazards at Work (NSW Code), which provides practical guidance to PCBUs on managing psychosocial hazards at work. While complying with the NSW Code is not mandatory, the NSW Code provides best practices for PCBUs to understand and comply with their work health and safety obligations. A failure to comply with the NSW Code can be evidence of a breach unless a control of similar standard is implemented.

The NSW Code reflects a concern by safety regulators that psychological health has often been neglected by PCBUs when considering workers’ health and safety. Similarly, while physical hazards and risks at work are relatively evident and often managed, psychological hazards and risks are harder to identify and can be easily overlooked by PCBUs.

Given the new explicit requirement under the NSW Regulation on PCBUs to manage psychosocial risks and implement control measures accordingly, PCBUs are now legally obligated to turn their minds to address mental health in the workplace.

How can employers comply with the obligation?

The new provisions to manage psychosocial risks are broad and require consideration of not only the physical work environment but also psychological and social context in the workplace.

To comply with the new positive duty under the NSW Regulation, PCBUs should conduct a risk assessment of the workplace and review whether their current risk control measures are adequate to control psychosocial hazards. PCBUs should develop and implement proper control measures considering the factors provided by the NSW Regulation.

For businesses operating in other states and territories, employers should expect the implementation of similar positive duties in their jurisdiction. For example, while Victoria does not adopt the harmonised work health and safety laws, the state is also currently proposing to amend its Occupational Health and Safety Regulations 2017 (Vic) to include an express obligation to manage psychosocial risks at work. The Victorian proposal goes further than the NSW Regulation or the Model Regulations, proposing to include additional record-keeping and reporting requirements.

All businesses and employers should proactively consider risks to psychological health in the workplace in addition to physical health and build and adopt an effective risk management process to manage those risks.

If you have any questions or need assistance with WHS issues in your workplace, please contact us below or send us your enquiry here.

Authors: Edmund Burke, Michael Selinger, Aiyana O'Meara & Jamie Kim

The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

Published by:

Aiyana O’Meara

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