10 December 2025
5 min read
#Government, #Workplace Relations & Safety
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Psychosocial hazards are no longer a ‘soft’ workplace issue – they have become a critical compliance priority. Employers who fail to manage them can face serious consequences, from legal liability and regulatory scrutiny to prosecution. Across Australia, safety regulators are making it clear: mental health risks must be treated as seriously as physical hazards.
While this article focuses on Queensland’s legislative framework, Victoria has recently commenced its new Occupational Health and Safety (Psychological Health) Regulations 2025 and New South Wales continues to strengthen its approach to psychosocial risks. Recent cases also demonstrate that courts and regulators are reinforcing psychological safety as an enforceable workplace right.
In Queensland, the obligation is set out clearly in the Work Health and Safety Act 2011 (Qld) (WHS Act). Section 19 requires a person conducting a business or undertaking (PCBUs) to ensure, so far as is reasonably practicable, the health and safety of workers and others. Crucially, this includes the psychological health of workers.
Under the Work Health and Safety Regulation 2011 (Qld) (WHS Regulation), psychosocial hazards can arise from:
Examples of these hazards include high job demands, low job control, poor organisational support, and instances of violence, aggression, bullying, harassment and sexual harassment. Such hazards create a significant and foreseeable risk to the health and safety of a worker and may cause psychological harm, such as stress, anxiety, depression and, in some circumstances, physical harm.
To ensure compliance with the WHS Act and WHS Regulation, PCBUs must strive to provide a work environment without risks to health and safety. This requires:
Regulators expect these measures to consider factors such as the duration, frequency, and severity of exposure to psychosocial hazards, as well as work design, systems, workplace behaviours, and environmental conditions. The result is a more complex compliance landscape, and one that employers must navigate carefully.
The renewed regulatory focus on psychological safety is supported by national claims data. Safe Work Australia CEO, Marie Boland, recently highlighted a 37 per cent increase in mental health compensation claims between 2017–18 and 2021–22. These claims now make up 9 per cent of all serious workers' compensation matters, reflecting both rising awareness and rising workplace pressures.
Queensland-specific data in the WorkSafe Queensland 2024–2025 annual report shows a similar trend:
The financial and organisational impacts of psychosocial harm are real and growing.
Courts and regulators are reinforcing that psychological safety is an enforceable workplace right. We highlight a number of relevant cases below.
In Haytham M J Remawi v Virgin Australia Airlines Pty Ltd [2023] FWC 1501, the Fair Work Commission found that a worker's false reports about his colleagues created ‘psychosocial safety’ risks. The reports included overstated accusations, false reports and unfounded allegations.
Commissioner McKinnon’s decision reinforced that a person’s employment can be terminated for causing a safety hazard. In particular, the Commissioner stated:
“The making of false and/or exaggerated reports about other operators and leading hands was not only likely to undermine the trust of his colleagues, but also created risks to their health and safety, including psychosocial safety.”
In the circumstances, it was found that the employee’s termination was fair.
In September 2025, SafeWork NSW issued a prohibition notice to the University of Technology Sydney (UTS), requiring a pause on staff reductions due to the risk of serious and imminent psychological harm to employees. The regulator made it clear that employers must manage psychosocial risks “like any other health and safety issue”. The prohibition notice will remain effective until UTS demonstrates compliance by addressing the identified health and safety concerns.
SafeWork NSW also issued improvement notices to two faculties at Macquarie University, directing them to consult workplace safety committees during restructuring. Staff input was required to ensure decision-making processes considered the psychological impact of change. The notices provide further evidence of Australia's safety regulators increasingly focusing on psychosocial hazards in the workplace.
In October 2025, WorkSafe ACT emphasised that psychosocial hazards, although less visible, must be managed through the same structured risk management approach used for physical hazards. Specifically, PCBUs need to identify the hazard, assess the risk, implement controls and monitor effectiveness.
Across Australia, safety regulators are tightening expectations around psychosocial risk management. Prohibition notices, improvement notices and increasing scrutiny show that psychological health is being treated on equal footing with physical safety under WHS laws.
This regulatory environment means that proactive psychosocial risk management is no longer optional, it is a legal and organisational imperative. By doing this, employers can protect their workers, reduce organisation risk, and support a safer, more resilient workplace.
If you have any questions regarding psychosocial hazards or your obligations under Queensland law, please contact us here.
Disclaimer
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.
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