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How to identify and protect employees suffering with mental health illnesses

Not only does poor mental health cause signature damage to the employee, the workplace, and the wider community, but it is also costing the economy. It is estimated that a combination of presenteeism, absenteeism and psychological workers compensation claims cost an estimated $2.8 billion in NSW every year.


In 2020 SafeWork Australia reported 21% of workers compensation claims accepted or pending were psychosocial claims, which is why educating businesses on how to better manage mental health issues is so important.

Common psychosocial hazards in the workplace have been identified to include:

  • Role overload (high workloads or job demands)
  • Role underload
  • Exposure to traumatic events
  • Role conflict or lack of role clarity
  • Low job control
  • Conflict or poor workplace relationships between workers and supervisors/managers
  • Lack of support
  • Workplace violence
  • Bullying
  • Harassment
  • Lack of recognition
  • Hazardous working environments
  • Remote or isolated work
  • Poor procedural justice
  • Poor organisational change consultation

The pandemic, recurring lockdowns, and the associated increase in remote working have increased risks for employees whilst making it more difficult for employers to identify signs of psychosocial distress. So, what can employers do to protect themselves, their employees, and their businesses from a mental health crisis?

This article outlines:

The current guidance across states and territories

New South Wales

On 26 May 2021, SafeWork NSW introduced their first Code of Practice – Managing Psychosocial Hazards at Work (Code) to assist businesses with practical tips and solutions to identify, manage and deal with any psychological risks and incidents that may arise.

Duty holders under the Code are identified as PCBUs; other companies carrying out work on the same site; companies with management and control of a workplace; and companies who together deliver a service (e.g. Government agencies establishing policies that would affect the work of others).

Officers also have their own duties, which are proactive and not reactive. These include due diligence obligations to take active steps to ascertain with certainty that their PCBU is compliant with its OHS obligations. None of the duties under OHS legislation are transferable and cannot be contracted out of.

The Code contains fantastic examples of different case studies and scenarios to educate businesses, including a sample risk register, and provides a useful guide of how to implement a hierarchy of controls for psychological risk.

Western Australia

In August 2021, the Commission for Occupational Safety and Health (the Commission), released a draft code of practice for comment: Psychosocial hazards in the workplace

WA’s draft builds upon the NSW Code but focuses less on individual duty holders, concentrating on the overall workplace culture and the collective responsibility of the employer.

The draft code focusses on:

  • supportive and capable supervision
  • the importance of training and education of both workers and supervisors so that everyone can readily identify risks.
  • risk control strategies around safe systems of work, including using work design as a control (by substituting current hazardous work methods) so that the employer can still efficiently deliver services while also minimising psychosocial harm.

The closing date for public consultation is listed as 11 October 2021.


Currently, there is no similar Code of Practice that exists in Victoria, however, s 20(2) of the Occupational Health and Safety Act 2004 (VIC) states the following factors are relevant in determining what is reasonably practicable:

  • the likelihood of the hazard or risk concerned eventuating;
  • the degree of harm that would result if the hazard or risk eventuated;
  • what the person concerned knows, or ought reasonably to know, about the hazard or risk and any ways of eliminating or reducing the hazard or risk;
  • the availability and suitability of ways to eliminate or reduce the hazard or risk;
  • the cost of eliminating or reducing the hazard or risk.

WorkSafe Victoria has noted that ‘material published by other Australian health and safety regulators’ is expected to be known by employers if there is insufficient information about the area under the Victorian legislation and codes.

Best practice guidance for employers

  1. Identify psychosocial risks
    • Collect information from existing resources such as workplace surveys, incident reports, investigations, absenteeism reports, organisational reviews
    • Consult with employees to identify the source of risks that could be ingrained within the business (e.g. organisational structure)
    • Implement a risk assessment process for all employees that is regularly reviewed.
    • Build a culture where there is active reporting of psychosocial hazards and they are escalated to the appropriate person as soon as possible
  2. Implement appropriate controls
    • Maintain regular consultation with employees is necessary – compared to physical risks, psychosocial risks can evolve and change day-to-day. Our friends at Found Consulting have created a practical guide for checking in with employees that you may find useful.
    • Ensure access to support and resources such as Employee Assistance Programs which can assist with mitigating psychosocial risks as employees have a safe space to discuss their issues.
    • Risk assessments are a tool that should be regularly executed as part of an ongoing improvement process – they are not a one-off solution.
    • Risk controls should be implemented across the organisation, and reasonable adjustments should be made to accommodate individual workers’ needs. All risk controls must be regularly reviewed and monitored to check their adequacy
    • Improving mental health literacy and educating employees to be more cognisant of their own symptoms is a crucial step.
    • Train leaders and supervisors at all levels of the organisational structure in how to identify, manage and support employees (especially those who may present symptoms in less typical ways due to gender, ethnicity or religion) in recovery from mental illness. FCW Lawyers can tailor any of our in-house training topics for your organisation, including:
    • Ensure organisational leaders are aware of mental illness triggers and are empowered to make decisions for the workplace that seek to eliminate or reduce as far as is practicable, known risk factors and promoting factors that increase organisational resilience.
    • Have a process in place for managing any WorkCover claims, including a plan for an injured worker’s return to work.
  3. Act fast if a risk is identified or an incident happens
    • Just like any workplace incident – conduct an investigation
    • Notify WorkSafe if it is a notifiable incident
    • Keep relevant records and objective notes in case you need to defend any legal proceedings

Related case summaries:


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