WHS Update – Managing psychosocial risks in the workplace is more important than ever

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By Laura Sowden, Partner and Anna Ly, Associate.

PCBUs and employers are now required to implement control measures for psychosocial risks in the workplace due to changes to the NSW Work Health Safety Regulations. Continue reading to find out more about what you need to know.

It has undoubtedly been a challenging year for employers and the community with employment reforms and legislation constantly evolving. Employers and PCBUs have an increasing expectation to provide a psychologically safe workplace for its workers and to prevent the exposure of hazards to their workers’ mental health. Psychosocial risks in the workplace may not be as apparent and in turn create difficulty for employers and PCBUs to identify.

SafeWork Australia highlights that on average, 7,984 Australians are compensated for work related mental health conditions each year.

In mid-2022 the NSW Government made changes to the Work Heath Safety Regulation 2017 (NSW). Those changes

(1) define psychosocial hazards and risks,

(2) require PCBUs to implement control measures for psychosocial risks; and

(3) require PCBUs to take certain matters into account in creating those control measures.

What are psychosocial risks

Psychosocial hazards are not always physically visible but that does not mean employers and PCBUs should ignore any signs of such hazards.

A psychosocial hazard in the workplace may cause psychological or physical harm to a worker. The psychosocial risk is when that hazard is realised and impact workers.

A psychological hazard can arise from or relate to the design or management of work, the work environment, plant, workplace equipment and harmful workplace interactions or behaviours.

It is a psychosocial hazard which gives rise to a psychosocial risk to the health and safety of workers or others.

There are many aspects of work which could lead to a psychosocial risk. Common examples of risk factors include:

  • Workplace bullying, harassment, violence and microaggressions
  • Poor support and communication from supervisors and managers
  • Fatigue
  • Mental stress
  • Remote or isolated work
  • Poor physical environment and workplace design
  • Job demands including work overload or underload
  • Inflexible work schedules or unpredictable work hours

Mental health awareness particularly in the workplace has received greater global attention in recent years with the WHO releasing a guideline addressing mental health, preventing mental health conditions and enabling people with mental health conditions to thrive in the workplace.

What  happens when workers are exposed to psychosocial risks

The difficulty with psychosocial hazards for PCBUs and employers is the unpredictability of a risk possibly arising from managing an employee’s employment. The consequences of exposure to these risks can include anxiety, depression, post-traumatic stress disorder, musculoskeletal injuries, chronic disease and fatigue related injuries, amongst other things.

All of which could result in employment related claims (including workers’ compensation, discrimination, breaches of WHS), SafeWork investigations into the workplace and depending on the seriousness, SafeWork prosecutions.

The problem with psychosocial risks is that they may interact or combine with each other to make new, changed or heightened risks. As such, it is vital that employers remain vigilant in their identification, assessment and management of psychological hazards in the workplace.

PCBU and Employer obligations

Under the model legislation s 19 the Work Health and Safety Act 2011 (NSW) (WHS Act), PCBUs owe a primary duty of care to ensure the health and safety of workers and others at the workplace, so far as is reasonably practicable.

That includes ensuring that workers and others are not exposed to risks to their mental health.

PCBU and Employers have an obligation to provide their workers with the right instruction, training and supervision to do their jobs safely. Organisations and leaders need to create an accepting culture that is inclusive and safe.

The reporting lines need to be clear so staff are confident appropriate action will be taken if they speak up.

In NSW, PCBUs must now consider the below factors when determining what control measures to put in place to manage psychosocial risks:

  • have regard to the duration, frequency and severity of the exposure of workers and others to how the hazards might interact or combine;
  • the design of work;
  • how work is managed, organised and supported;
  • the workplace’s design, layout and environmental conditions;
  • the design, layout and conditions of workers’ accommodation;
  • the workplace’s plant, substances and structures;
  • workplace interactions or behaviours; and
  • the information, training, instruction and supervision provided to workers.

Model Code of Practice

The Model Code of Practice (Code) first introduced on 28 May 2021 sets out what PCBUs should do in accordance with their responsibilities under the WHS Act, to avoid psychosocial risks and manage potential psychological hazards in the workplace.

The Code requires hazards to be identified, assessed, controlled and control measures reviewed. Essential elements of an effective systematic risk management process include leadership and management commitment, consultation of workers and supply chain and adequate planning.

PCBUs that fail to follow or consider the Code may result in a finding that it has breached their work health and safety duties.  In any action by a regulator it and worst case scenario a Court will have regard to the Code as a standard to be complied with.

Recent Case Law

The recent decisions in NSW provides a timely reminder for PCBUs and employers of the importance of taking steps to manage psychosocial hazards and risks in the workplace.

The Department of Defence

The Department of Defence (Defence) was charged with allegedly failing to manage psychosocial risks in relation to the worker’s suicide. The Defence was charged with a category 2 and two category 3 breaches which carry a total maximum penalty of $2.5 million.

An investigation into the death of a Royal Australian Air Force technician whilst on duty revealed that Defence had breached its duty of care under s 19(1) of the WHS Act, by failing to provide, so far as reasonably practicable, safe systems of work, necessary training for workers, and information needed to protect persons from risks to their health and safety.

Office of Public Prosecutions

The Kazarov[1] decision is significant as it has determined that employers have a relevant duty of care to proactively reduce the risk of injury and foreseeability of psychiatric harm.

The plaintiff worked as a solicitor for the Victorian Office of Public Prosecutions (the OPP) in the Specialist Sexual Offences Unit (the SSOU) and was routinely exposed to sexual violence towards children.

The plaintiff experienced post-traumatic stress disorder and sued the OPP for negligence. The case took into consideration the High Court’s decision in Koehler v Cerebos (Australia) Ltd which stated that an employer “in engaging in employee to perform stated duties is entitled to assume, in the absence of evident signs warning of the possibility of psychiatric injury, that the employee considers that he or she is able to do the job”.

Given that the circumstances of the plaintiff’s particular type of work with the OPP was inherently and obviously dangerous to the psychiatric health of the employee, it required the employee to be proactive in the provision of measures to enable the work to be performed safely by the employee.

The OPP was found to have not adequately trained the plaintiff to be aware that the continual exposure to this unit could result in PTSD or other mental illness. Furthermore, the High Court found that none of the measures identified by the OPP’s policy, or any other reasonably available protective or other measures was implemented within the SSOU.

The plaintiff was awarded $435,000 (comprising of $200,000 for pain and suffering, $120,000 for past economic loss and $115,000 for future economic loss).  The Court of Appeal overturned this previous finding however the appeal was ultimately reversed by the High Court, finding found in favor of the plaintiff.

Key takeaways

Psychosocial hazards present new and distinctive challenges as they can remain ‘invisible’ when assessing safety in workplaces.

The changes to legislation and the Model Code mean there is increasing recognition that PCBUs must take a proactive approach and properly implement risk assessments, adequate safety training and support, have clear and effective control measures and an active work health and safety system underpinning it all.

[1] Kozarov v State of Victoria [2022] HCA 12

For further information, please do not hesitate to contact us.

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