Mental health and psychosocial risks in the workplace

There is recognition and mounting awareness of the role of work in supporting or hindering employee mental health. It is clear that work can serve as a protective factor for mental health by providing: a sense of purpose and achievement, social interaction, self-efficacy and confidence, financial stability and more. However, work can also be a source of significant stress and pose risks to the mental health and wellbeing of employees.

Interestingly, a survey of Australian workers found that whilst 91% of employees believe that it is important to work in a mentally healthy environment, only half consider their workplace to be mentally healthy.[1] Australian businesses might not be able to control factors outside the workplace that impact mental health, however they do have a legal obligation under the WHS Act to eliminate or minimise exposure to work-related risks that could result in psychological harm.[2] 

What are psychosocial risks?

Psychosocial risks are elements within the workplace influence sphere that can have a negative impact to the mental health and wellbeing of employees. Certain risks by themselves have the potential to bring significant harm to employees such as experiencing bullying, sexual harassment or occupational violence. Even more prevalent, however, are the more subtle elements of work that can chip away at wellbeing over time such as vicarious trauma, poor leadership support, interpersonal conflict, job insecurity and more. Often employees are exposed to a combination of psychosocial risks within the workplace – some are widespread, while others only impact a specific team or business unit.

Where psychosocial risks are prevalent, employees are at increased risk of psychological injury, disengagement and reduced productivity.[3] Poor mental health is costing the Australian economy more than $60 billion each year and $12 million in lost working days.[4] On the other hand, there is a significant return on investment from building a mentally healthy workforce. Figures show that every $1 an organisation spends on resourcing and creating a mentally healthy workplace generates a benefit of $4.10.[5]

Managing psychosocial risks

A mentally healthy workplace does not just happen by chance. Organisations need to be proactive in managing psychosocial risks in the workplace in order to support psychologically healthy environments. More often than not, workplaces wait for a crisis to occur before taking action. This approach is not only costly, but it also means that a business is not complying with their legal obligation to protect employees from work-related psychological harm. In order to prevent or mitigate risks, organisations need to identify and assess the risks, implement control measures and monitor and review these controls over time.

Centre for Corporate Health supports a range of our clients in developing and conducting reviews. Whether the aim is to assess progress in supporting mental health in the workplace, or uncovering “root cause” for reduced mental health and wellbeing in a team, we provide expert methodology, effective timeframes and practical recommendations for our clients.  

To find out more about our approach to managing psychosocial risks in the workplace, please contact the Centre for Corporate Health on 02 8243 1500 or admin@cfch.com.au. Additionally, you can check out our website, for further information.


[1] Beyond Blue. (2014). State of workplace mental health in Australia

[2] Workplace Health and Safety Queensland. (2019). Preventing and managing risks to work-related psychological health.

[3] Guarding Minds at Work. (2020). Retrieved from https://www.guardingmindsatwork.ca/about/about-resources

[4] KPMG. (2018). Investing to Save: The economic benefits for Australia of investment in mental health reform. Retrieved from https://mhaustralia.org/publication/investing-save-kpmg-and-mental-health-australia-report-may-2018

[5] Deloitte (2019). The ROI in workplace mental health programs: Good for people, good for business. Retrieved from https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/about-deloitte/ca-en-about-blueprint-for-workplace-mental-health-final-aoda.pdf