Psychosocial Hazard penalties are for real

The Work Health and Safety Act 2011 (ACT) requires that a Person Conducting a Business or Undertaking (PCBU) must ensure the health and safety of its workers while engaged in or at work. 

This duty includes ensuring that workers are not exposed to psychosocial hazards arising from the business. The PCBU must take care to eliminate or minimise potential hazards as far as reasonably practicable.

Case study: the Department of Defence

In a recent case, the Department of Defence was the first Commonwealth employer to be found guilty of breaching its primary health and safety duty and fined $188,000.00.

The Department of Defence makes use of a Work Plan procedure as a performance management tool. An employee stationed at the RAAF Base Williamtown near Newcastle was subjected to four separate work plans over a six-month period.

During the performance management process, the employee displayed increasing signs of distress and ill-health, making it clear he was working under stress and pressure. Despite being aware that the process could be causing psychosocial injuries, the employer failed to take any mitigating steps or provide support to the employee during this time.

It was found that the Department failed in the following ways:

• to provide the necessary training for supervisors involved in the Work Plan process
• to take proactive steps to support the employee when his distress was known and identified
• failed to refer the worker for medical assessment or know when to suspend the Work Plan

Key takeaways for members

1. An employer should implement a performance management plan when an employee is underperforming, however the manager or supervisor with charge of this plan must be trained in its execution.
2. During performance management it is reasonably foreseeable that an employee will be subjected to additional stress psychosocial hazards. The employer must ensure that the mental wellbeing of the employee is monitored, and act appropriately if the employee is unwell or displaying signs of stress.
3. A performance management plan is a useful tool that, when used appropriately, can be very effective. An employer should guard against overuse of performance management against an individual employee, or drawing out the process without a clear goal or time-period.
4. An employer’s failure to ensure the health and safety of the employee during the performance management process may lead to a breach of its obligations under the Work Health and Safety Act 2001 (ACT). This could incur substantial penalties including criminal convictions for the employer.

For questions about your work, health and safety obligations, contact the Master Builders ACT Workplace Relations Team on (02) 6175 5900 or via email at workplace@mba.org.au.