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The share volume of workers’ compensation claims pertaining to psychological injuries in 2024 was overwhelming for a number of Australian businesses, new research shows.
Data from Allianz has found that the number of psychological workers’ compensation claims over the last half decade has nearly doubled with a 47.5 per cent increase, with businesses reportedly losing over 655,000 working days due to issues such as burnout, work pressure, bullying and harassment.
“Claims data from Allianz has found that psychological workers’ compensation claims are becoming more complex – and figures are continuing to rise,” said Julie Mitchell, chief general manager, personal injury, at Allianz Australia.
“As factors like the right to disconnect, technology enhancements and workplace diversity continue to shift the nature of work, leaders must ensure their workers’ compensation policies are in tune with changing employee needs.”
The consequences of failing to do so can lead to massive fallouts for Australian organisations, as seen recently in a polarising High Court case. Vision Australia was blasted with a $1,442,404.50 penalty for breaching the terms of an employee’s contract through a “disgraceful” termination process – which led to psychiatric injury.
Nick Korkliniewski, a senior associate at Arnold Thomas & Becker, argued that this case set a precedent for the “destigmatisation of psychological injury”.
“In its simplest form, our client’s case was that his employer should have taken reasonable care and properly followed their own disciplinary procedures if they were to terminate his employment,” Korkliniewski said.
“Community expectations around rights to psychological safety at work and the destigmatisation of psychological injury means that the time was right for the law to recognise the requirement of an employer to consider their employee’s psychological health in the course of investigative and disciplinary processes.”
Mitchell believes it’s crucial for organisations to understand the severity of psychological injuries sprouting in the workplace – offering numerous suggestions on how employers can navigate and mitigate the potential threats.
“Remember, not all injuries in the workplace are physical. Workplace policies and practices must also protect against mental injury by managing psychosocial risks and prioritising employee wellbeing and mental health support,” Mitchell said.
“Consider how technology can be used as an enabler to understand and meet individual employee needs. Our 2024 research found 80 per cent of Australian managers believe technology such as AI can play a positive role in better understanding diverse employees, such as learning best practice communication methods and providing tools that support working styles for different employees.”
“Invest in creating inclusive and empathic spaces that build a psychologically safe workplace culture to ensure 1) employees feel supported, alleviating work pressure and potential burnout and 2) business productivity can continue to thrive.”
“As managers look to the year ahead, now is a critical time to reset and invest in effective mental health support and psychosocial safety measures to reflect shifting workplace dynamics that determine employee wellbeing and job satisfaction.”
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Employees experience burnout when their physical or emotional reserves are depleted. Usually, persistent tension or dissatisfaction causes this to happen. The workplace atmosphere might occasionally be the reason. Workplace stress, a lack of resources and support, and aggressive deadlines can all cause burnout.
Kace O'Neill
Kace O'Neill is a Graduate Journalist for HR Leader. Kace studied Media Communications and Maori studies at the University of Otago, he has a passion for sports and storytelling.
