Address psychosocial hazards in workplace investigations to protect your people and organisation

A poorly managed workplace investigation has always been:

• a source of complaint from an aggrieved participant; or

• an ongoing or separate cause of injury – giving rise to additional litigation risks;

• a potential breach of contract claim (to the extent policies make guarantees or promises of safety); and generally

• an ineffective way of addressing workplace concerns.

However, the codification of psychosocial hazards in most states and territories has escalated the importance of guarding against such hazards. What is clear is that psychosocial hazards are evident not just from poor workplace conduct but in the way in which management carries out its functions.

The issue then, unfortunately, becomes quite circular – a complaint is raised, giving rise to safety concerns and identifying psychosocial hazards. The complaint is investigated – the manner and process of that investigation exacerbates those psychosocial hazards and/or creates new ones. A new complaint is made in relation to the investigation process and the circle continues.

But, workplace investigations are a necessary process, so we need to look critically at the why, when and how of the workplace investigation to break this cycle.

To understand how to do this, we need to start at the beginning.

What do we mean by psychosocial hazards?

The Model Work Health and Safety (WHS) Regulations provide a psychosocial hazard is anything that:

• arises from, or relates to, the design or management of work, the working environment, plant or workplace interactions; and

• may cause psychological harm (whether or not it also causes physical harm).

State and Territory legislation, as it relates to the management of psychosocial hazards, is built off the Model WHS laws and Regulations, so this is a framework replicated across most of Australia.

The following provisions mirror the Model WHS Regulations on psychosocial hazards:

• Work Health and Safety Regulation 2011 (Qld), regs 55A to 55D;

• Work Health and Safety Regulation 2025 (NSW), regs 55A to 55D;

• Work Health and Safety (General) Regulations 2022 (WA), regs 55A to 55D;

• Work Health and Safety Regulations 2012 (SA), regs 55A to 55D;

• Work Health and Safety Regulations 2022 (Tas), regs 55A to 55D;

• Work Health and Safety Regulation 2011 (ACT), regs 55A to 55D; and

• Work Health and Safety (National Uniform Legislation) Regulations 2011 (NT), regs 55A to 55D.

Victoria has adopted a different framework, instead introducing standalone regulations for the management of psychosocial hazards, the Occupational Health and Safety (Psychological Health) Regulations 2025 (Vic). These regulations took effect from 1 December 2025.

Safe Work Australia’s 2022 Model Code of Practice: Managing Psychosocial Hazards at Work lists common examples of what a psychosocial hazard might be: excessive job demands, low job control, inadequate support, poor organisational justice, bullying, sexual harassment, conflict, exposure to traumatic material, remote or isolated work and violence or aggression, to name a few.

Frequent, prolonged or severe exposure as well as a single instance of exposure to these hazards can lead to anxiety disorders, depression, burnout or secondary physical injuries such as cardiovascular disease or musculoskeletal problems. The risks associated with psychosocial hazards are not new – and the consequences of ignoring them are real and immediate. Courts have repeatedly found employers liable for psychiatric injury caused by workplace factors, even before the introduction of specific psychosocial hazard regulations. In Goldman Sachs JBWere Services Pty Ltd v Nikolich (2007) 163 FCR 62, the Federal Court made it clear: failing to respond to bullying and workplace stress can – and does – result in damages. In Hayes v State of Queensland [2017] 1 Qd R 337, the Court again highlighted that workplace harassment and lack of support expose employers to significant legal and financial risk. These are not isolated incidents; they are a pattern, focused on an employer's action or inaction to remediate safety risks, which in itself gives rise to further risks.

The urgency of this issue is underscored by the recent decision in State of New South Wales (Hunter New England Local Health District) v BHU [2025] NSWPICPD 52 (which was an appeal of the Personal Injury Commission's finding in 2024). The Personal Injury Commission had previously found that a worker suffered psychological harm as a direct result of how workplace complaints and the investigation process were handled. While the decision was successfully appealed, for our purposes the Commission’s findings remain relevant and are a wake-up call: psychosocial hazards are often intensified during investigations, and any failure to provide proper process or support can result in compensable injury. The BHU decision signals that the risk of psychological harm during investigations is immediate, and that courts and tribunals are ready to hold employers accountable.

You have a positive duty, so far as is reasonably practicable, to eliminate or, if that is not possible, minimise psychosocial risks. As employers, our focus needs to be on how we conduct investigations and actively take steps to mitigate the risk. This is not just a regulatory box-tick.

Why do psychosocial hazards spike during workplace investigations?

An investigation – whether into misconduct, bullying, a safety incident or a regulatory breach – changes the normal work environment.

Several of the risk factors named in the Model Code of Practice are suddenly intensified:

• High job demands and time pressure – key witnesses or respondents may still have to perform their usual duties while gathering documents, attending interviews and coping with uncertainty.

• Low job-control – parties have little influence over investigative steps, confidentiality constraints or the timing of outcomes.

• Poor organisational justice – even the perception of bias or opaque process can trigger heightened stress responses.

• Conflict and poor workplace relationships – allegations often entrench divisions; gossip, side-taking and social isolation can follow.

• Role ambiguity – employees may be unsure what they can safely say, how much loyalty they owe to different parties or what behaviour could be seen as retaliation.

• Exposure to traumatic material (and spare a thought here for the investigators themselves) – sexual harassment, violence, clinical incidents or child-protection matters routinely involve distressing evidence. Kozarov v State of Victoria [2022] HCA 12 demonstrated how cumulative exposure to traumatic content, without adequate safeguards, could result in compensable psychiatric disorders. This case is a recent example, but earlier cases such as Nikolich and Hayes also demonstrate that courts have awarded damages for psychiatric harm where employers failed to manage psychosocial risks, even before the current regulatory framework.

If you fail to recognise and address these layered risks, the investigation itself can cause new injuries or exacerbate existing ones – leading to secondary claims, undermining evidence quality, damaging organisational reputation, and prolonging organisational disharmony. The legal, financial, and human consequences of failing to manage these risks are well established. In Nikolich, the employer’s inaction led directly to a successful damages claim. In Hayes, the court confirmed that failing to support employees during workplace conflict and investigations exposes employers to liability. The BHU decision is the latest – and perhaps most urgent – reminder: the risks associated with psychosocial hazards during investigations are real, immediate, and actionable. Impacts include not just costly claims but lost productivity, and irreparable harm to your workplace culture.

Practical steps to control psychosocial risks in investigations

The following are a list of practical considerations that should be taken into account before, during and after a workplace investigation to minimise psychosocial hazards arising.

Pre-investigation planning

• Hazard identification – apply the same WHS risk-management lens to the investigation that you would to any other work process:

  • Who will be interviewed? Will they have to relive traumatic events?

  • Are particular cohorts more vulnerable – younger staff, culturally and linguistically diverse (CALD) workers, employees already on a return-to-work plan?

  • Will the investigation schedule clash with critical operational peaks?

• Procedural clarity – a plain language investigation framework that is provided to investigation participants or is more widely available that explains each step, expected timeframes, confidentiality limits, support options and appeal mechanisms can be of benefit. Lack of role clarity and poor organisational justice rates are reduced when people understand the road map.

• Competent investigators – select investigators who are trained not just in fact-finding but in trauma-informed interviewing, cultural safety and WHS obligations. Officers have a due-diligence duty to resource and verify such competence.

Controls during the investigation

• Support pathways – offer employee assistance programs (EAP), peer supporters, cultural liaison officers or external counselling to all participants, not only complainants. Make accessing support normal and stigma-free.

• Workload adjustments – where participation places significant extra demands or emotional labour on a worker, provide roster relief, flexible deadlines or temporary role modification. The Model Code of Practice specifically recognises job-demand hazards and the need for adequate recovery time.

• Communication rhythm – provide regular, factual updates. Uncertainty breeds rumour and anxiety; even a short “the investigation is ongoing, we expect interviews to finish next week” message assists to maintain psychological safety.

• Safe interview settings – conduct interviews in neutral, private places, allow support persons, consider remote interviews where travel itself is fatiguing or where parties need geographic separation for safety reasons.

• Managing interpersonal contact – if conflict exists between parties, can you roster them on different shifts, organise separate meal-break areas, or facilitate remote work to prevent escalation. Be careful: any stand-down must be a genuine risk-control measure and not disciplinary, if the decision has been made and in the absence of an express contract permission.

Post-investigation follow-through

• Debrief and hand-back – once findings are made determine the level of information that should be made available, meet individually with complainants and respondents to explain outcomes, available review rights, and ongoing support services. This restores a sense of control.

• Systems review – record psychosocial hazards encountered, evaluate what controls worked and feed lessons learnt into future investigation planning.

• Reintegration/after-care – where relationships remain tense, facilitated team conversations or refresher training on respectful behaviours can, at best, prevent a relapse into unsafe dynamics or at least evidence the employer's intention and ability to act in the event of further incidents.

Striking the balance: Procedural fairness and trauma-informed processes

And if that all sounds too easy, remember the risks that arise from the investigation methodology itself.

A common concern for employers is how to balance the need for procedural fairness with the imperative to conduct trauma-informed investigations. Both are essential: procedural fairness ensures that all parties are treated justly, with clear communication, the opportunity to respond, and unbiased decision-making.Trauma-informed processes, on the other hand, recognise the potential for psychological harm and seek to minimise re-traumatisation and distress but seek to limit the flow/sharing of information as part of the process.

Ultimately, it is a difficult balance. The key is not to see these as competing, but as complementary. Employers can seek to achieve both by:

• Clearly explaining the investigation process and participants' rights at the outset, so no one is left in the dark.

• Allowing support persons or advocates/workplace delegates (if necessary) for all parties, not just complainants, to ensure everyone feels safe and heard.

• Scheduling interviews with flexibility, allowing breaks, and being sensitive to signs of distress, while still gathering the necessary information.

• Ensuring investigators are trained in both procedural fairness and trauma-informed practice, so they can adapt their approach as needed without compromising the integrity of the process.

• Communicating outcomes respectfully and privately, and providing access to support services regardless of the findings.

By seeking to embed both procedural fairness and trauma-informed principles, employers not only meet their legal obligations but also foster trust and psychological safety throughout the investigation process.