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Psychosocial Safety Explained & How To Embed This Into Your Leadership Strategy

For a long time I have been championing the concept of psychological safety in leadership strategy and it has quite frankly been a bit of a challenge at times. The short sightedness of profits before people has driven me to despair and is hampering long term leadership development strategies.

The time for dismissing the obligation of creating a work environment where employees feel their psychological well-being, mental health, emotional well-being and social connectedness are protected is NOW!

If organisations haven’t been convinced by the compelling evidence that show that when people feel psychosocially safe – they perform better, engagement rises, innovation improves, wellbeing improves, and KPI’s are met and exceeded, the looming deadline of legislative requirements should now get this front and centre of organisational focus.

New Regulations 

On 1st April, here in Australia, regulations come into effect that require organisations to manage psychosocial risks and hazards at work, and this is no April fools’ joke.

Under the model WHS laws, a person conducting a business or undertaking (PCBU) must manage the risks of psychosocial hazards in the workplace. A PCBU can be a company, an unincorporated body or association, a sole trader or self-employed person. It applies to every working arrangement or structure.

What Is A Psychosocial Hazard?

A psychosocial hazard is defined as ‘anything that could cause psychological harm (e.g. harm someone’s mental health). Common psychological hazards at work include: lack of role clarity, poor organisational change management, inadequate reward and recognition, poor organisational justice and remote or isolated work. It also includes the more traumatic events like poor physical environment, violence and aggression/bullying, harassment including sexual harassment, conflict or poor workplace relationships and interactions.

At time of writing this, the Financial Services Union has launched a major test case on excessive hours against the National Australia Bank. A survey conducted in late 2021 by the FSU found concerning reports of psychosocial hazards such as – staff were fearful of being subjected to material and psychological abuse by their employer, citing examples that justified those fears, a ‘culture of exploitation within the company’ and ‘failure to provide safe workplace’ due to actions regarding overtime hours.

Whilst the case is described as a serious contravention of Section 62 of the Fair Work Act, it is also a poignant example of failure to mitigate psychosocial hazards for NAB employees. FSU National Secretary Julia Angrisano warns ‘this case is just the start. We know the culture of the big banks exploits workers, and we will be going after them as well’.

The psychological hazards listed above can be mitigated by good leadership, sound processes and systems. Every organisation needs to firstly, develop a strategy for identifying and mitigating psychosocial hazards.

Psychosocial Safety

The first place to start is to measure psychosocial safety, so you can allocate resources where they are most needed. We have seen firsthand the benefits of measuring psychosocial safety in teams to support organisations to make data driven decisions, and identify leaders that need training and coaching to lead in a way that doesn’t cause psychological harm.

Secondly, educate every person in the organisation about psychosocial safety and the part each person can play in building it. Education and training needs to be supported by processes that embed psychosocial safety practice as the norm. We have also seen the impact that coaching of leaders can have on adjusting their leadership style to lift psychosocial safety.

Monitor progress by measuring psychosocial safety every three months so you can identify leaders and teams that continue to need support to mitigate risk of psychosocial hazards and celebrate wins and successes.

Does your organisation have a clear leadership strategy that will support leaders to develop their capacity to provide a psychosocially safe team environment?

If the new regulations and looming class action suits haven’t put this on your radar I am not sure what will.

Contact us at to talk to us if you need help measuring and building psychosocial safety in your organisation.

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