Managing psychological risks in the workplace: Why policies alone are no longer sufficient – Health & Safety

The Occupational Health and Safety (Psychological
Health) Regulations 2025 (Regulations)
commenced in Victoria late last year, imposing new and more
prescriptive obligations on employers to manage psychosocial
hazards. For many organisations, this will require a shift away
from policy-led approaches towards more proactive changes to how
work is designed, managed and performed.

Similar to the framework that has long applied to physical
hazards, the Regulations require employers to identify, assess,
control and review risks to psychological health. The changes align
Victoria with other Australian jurisdictions and reflect a broader
regulatory and governance expectation that psychological health is
a core component of workplace safety.

Given the enforcement powers available to WorkSafe Victoria, and
the link between compliance with these obligations and successful
workers’ compensation claims, employers that do not adapt their
approach confront increased regulatory and litigation risk.

What are psychosocial hazards?

Psychosocial hazards are broadly defined as factors arising from
the work environment, work design or management of work that may
cause an employee to experience a negative psychological response,
creating a risk to their health and safety.

Common examples include:

• bullying and harassment




• exposure to aggression or violence




• excessive or unreasonable job demands




• low role clarity




• poor organisational change management




• inadequate supervision or support.

Reliance on HR policies no longer sufficient

Traditionally, many employers have approached psychosocial risks
through human resources frameworks, relying primarily on policies,
codes of conduct and training programs to influence individual
behaviour. The Regulations make clear that this approach is no
longer sufficient.

Employers are required to prioritise controls that alter the
work or workplace itself, such as work design, systems of work,
management practices or the working environment. Information,
instruction and training may only be relied upon where these
higher-order controls are not reasonably practicable and must not
be the predominant measure where other controls are available.

The distinction is illustrated below:

Likely areas of regulatory focus and broader implications

In light of the new Regulations, WorkSafe Victoria is expected
to increase its focus on how employers are identifying and managing
psychosocial hazards during audits, inspections and investigations.
This may include scrutiny of:

• how psychosocial hazards are identified, particularly those
  arising from work design and systems




• the nature and effectiveness of control measures




• how concerns, incidents and complaints are handled and
  addressed




• whether controls are being reviewed following incidents,
  requests or organisational changes.

Practical steps for employers

Compliance can no longer be demonstrated by having policies in
place or delivering training. Employers must be able to demonstrate
active, ongoing management of psychosocial risks.

Employers should take the following steps to ensure
compliance:

• assign clear senior-level responsibility for psychosocial risk
  management




• systematically identify hazards arising from work design,
  workloads, job demands, change processes and management practices,
  using consultation, surveys, incident data, complaints, absenteeism
  and turnover trends




• genuinely consult with employees and health and safety
  representatives throughout hazard identification, risk assessment,
  control selection and review




• implement effective control measures that address root
  causes




• ensure clear reporting pathways and timely responses to
  psychosocial hazards and incidents




• regularly review controls, particularly after incidents, upon
  request or prior to organisational change




• maintain appropriate records to demonstrate compliance and
  audit readiness.

If you have any questions regarding how to identify and manage
psychosocial hazards in your workplace, please
contact us here.

This publication does not deal with every important topic or
change in law and is not intended to be relied upon as a substitute
for legal or other advice that may be relevant to the reader’s
specific circumstances. If you have found this publication of
interest and would like to know more or wish to obtain legal advice
relevant to your circumstances please contact one of the named
individuals listed.