Australia's psychosocial hazard framework is now in force across every jurisdiction. Most states aligned to the Comcare Code of Practice, Victoria under its own regulations. Boards and executive teams are expected to understand their obligations and their exposure.
Having implemented regulatory change in NZ banking, I've seen the pattern before. Define the risk, build the controls, then test whether the controls actually work.
That last step is where Australia's framework has a structural weakness. The measurement tools available can't reliably confirm whether controls are effective. Since the obligations apply to every employer in the country, this isn't a niche problem.
The measurement framework has a gap, and it undermines confidence in the risk data itself.
- National workers’ compensation data Useful, but lagging. It only shows harm once it has already occurred.
- Internal reporting metrics These carry a well‑known bias: the workplaces with the highest psychosocial risk are often the ones where employees feel least safe to report it.
- People at Work (PAW) PAW has been the primary free, regulator‑supported, nationwide tool. It is being decommissioned, with access ending in October 2026. No direct successor has been announced.
- HRIS and finance metrics Data such as turnover, absenteeism, sick leave, productivity and revenue per employee can signal a problem - but they don’t diagnose why it’s happening.
- Employee surveys Still the most common internal tool, but subject to bias - employees won’t disclose risks if they don’t feel safe to do so.
What's missing?
The psychosocial hazards regime requires organisations to identify, assess, control and review psychosocial hazards. It lists common hazards, but it does not require organisations to measure psychological safety — the foundational condition that determines whether employees feel safe to raise issues without fear of retribution.
If employees don't feel safe to report, the metrics are distorted - a problem for any framework built on voluntary reporting, not just this one.
The most effective way to close this gap is to implement a control test that:
When employees feel safe to be honest, diagnostic tools become genuine leading indicators rather than reflections of reporting culture.
The cost to Australia if Left Untreated
The costs related to psychological injuries in Australia make for sober reading:
For a 500‑person organisation, preventing even a handful of claims each year more than offsets the cost of continuous independent measurement.
Key Takeaway
Measuring Psychological Safety is key to Understanding your Exposure to Psychosocial Hazards
Benefits of Accurate Measurement
But the benefits of accurately measuring psychological safety extend far beyond compliance and cost avoidance. When employees feel psychologically safe:
In summary, organisational performance and employee wellbeing improve, and directors gain confidence that risks are being effectively managed.
Risk data reaching audit and risk committees reflects only what current systems and controls can capture. When those systems are lagging, stigma‑suppressed or incomplete, the risk being governed is materially understated.
From 1 July 2026, NSW’s updated provisions mean that failure to meet the standard of a Code of Practice can be used as evidence of a breach — even without proof of harm. Organisations must either comply with the code or demonstrate an equivalent or higher standard.
This is why diagnosis, coupled with strong controls, becomes essential.