Have you ever wondered about the true cost of workplace stress?
A recent report from Safe Work Australia paints a sobering picture of mental health in Australian workplaces. Mental health conditions account for an increasing proportion of serious workers’ compensation claims, and have garnered significant attention over recent years as awareness of their impact on individuals and workplaces has grown.
What are psychosocial hazards?
Psychosocial hazards are aspects of the work environment, work organisation, and social interactions at work that have the potential to cause psychological or social harm to employees. These hazards can lead to stress, burnout, and other mental health issues. Unlike physical hazards, which involve risks like machinery or hazardous substances, psychosocial hazards are related to how work is managed, the culture of the workplace, and the relationships between employees.
Some common examples of psychosocial hazards include workplace stress, unrealistic expectations, bullying and harassment, job insecurity, lack of support, role ambiguity or discrimination.
The rising tide of mental health claims
Did you know that 2 in 5 Australians had experienced a mental health condition at some point in their lifetime?
In 2020-22, the ABS National Study of Mental Health and Wellbeing reported that this was similar to the number of Australians who reported experiencing a mental health condition at some point in their lifetime in the 2007 study (45%).
Women were more likely than men to have experienced an anxiety or affective disorder in the past 12 months, while men were much more likely to have experienced a substance use disorder. In the same period, Australians aged 16-24 were most likely to report having experienced an anxiety, affective or substance use disorder.
Mental health conditions now account for nearly one in ten serious workers’ compensation claims. That’s a staggering 36.9% increase since 2016-17. But here’s the kicker – these claims aren’t just more frequent, they’re also more costly and time-consuming. On average, mental health claims result in four times more time off work and four times higher compensation payments compared to other injuries. It’s clear that workplace mental health is no longer an issue we can afford to ignore.
What’s causing the surge?
You might be wondering, “What’s behind this dramatic increase?” The report identifies three main culprits:
- Work-related harassment/bullying (27.5%)
- Work pressure (25.2%)
- Workplace violence (16.4%)
These factors account for over two-thirds of all mental health claims. It’s a stark reminder that our workplaces can be breeding grounds for stress and anxiety if we’re not careful.
Who’s most at risk?
Interestingly, some industries and occupations bear a heavier burden than others.
Health care and social assistance, public administration and safety, and education and training top the list of industries with the highest number of mental health claims. If you’re a community service worker, a professional, or in an administrative role, you might be more likely to experience work-related mental health issues.
The gender gap
Here’s a thought-provoking statistic: women filed 58% of all mental health claims.
Why the disparity? It’s likely due to higher representation in at-risk industries and occupations. Women also reported more exposure to psychosocial hazards like bullying and workplace violence. This raises important questions about gender equality and safety in our workplaces.
What can we do?
So, what’s the way forward? For employers, it’s time to take a proactive stance. Implementing psychosocial risk assessments, providing mental health awareness training, and establishing clear policies on workplace bullying and harassment are great starting points.
Incorporating psychological health and safety into governance is essential for fostering a supportive workplace environment. Here are key strategies to effectively integrate these practices:
1. Establish clear policies
Develop comprehensive policies that explicitly state the organisation’s commitment to psychological health and safety. These policies should outline the responsibilities of management and employees in identifying and mitigating psychosocial risks.
2. Conduct regular risk assessments
Implement regular assessments to identify psychosocial hazards, such as workplace bullying, excessive workloads, and lack of support. Utilise tools like the People at Work (PAW) survey to gather data on employee experiences and psychological distress levels.
3. Foster a supportive culture
Create a workplace culture that promotes open communication about mental health. Encourage employees to share their concerns without fear of stigma. Training programs can help managers recognise signs of incivility, mental health issues and respond appropriately.
4. Provide training and resources
Offer training for all employees on mental health awareness and coping strategies. Ensure that resources, such as counselling services and employee assistance programs, are readily available and accessible.
5. Monitor and evaluate
Establish metrics to evaluate the effectiveness of psychological health and safety initiatives. Regularly review claims data, such as the increase in mental health-related workers’ compensation claims, to assess the impact of implemented strategies and make necessary adjustments.
6. Engage stakeholders
Involve all stakeholders, including employees, management, and health and safety representatives, in the development and implementation of psychological health and safety strategies. This collaborative approach ensures that diverse perspectives are considered and increases buy-in from all parties.
Workplace mental health is not just a personal issue – it’s a societal one. By creating safer, more supportive work environments, we can not only reduce the significant costs associated with mental health claims but also foster happier, more productive workplaces.
What steps will you take to promote mental health in your workplace? Remember, even small changes can make a big difference. After all, a mentally healthy workplace is a thriving workplace.
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About our advisers:
Michael Fox has been dedicated to the success of his clients, devising comprehensive wealth strategies for both personal and business growth for over 4 decades. With extensive expertise in business governance and family business succession, Michael specialises in empowering emerging businesses and family enterprises by fostering renewal, enhancing value and smooth transitions to the next generation. Please do not hesitate to reach out if you need assistance.
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This is general advice only and does not take into account your financial circumstances, needs and objectives. Before making any decision based on this document, you should assess your own circumstances or seek tax advice from a qualified accountant at KMT Partners. Information is current at the date of issue and may change.
