Psychological Safety vs Psychosocial Hazards: What Employers Often Confuse

Co-written by Kyla Tustin, HSG specialist facilitator, and Michael Stone, founder and CEO of Holistic Services Group

Picture a team that scores well on every psychological safety question in your engagement survey. People say they can raise concerns. They say mistakes aren’t held against them. And two of them are on stress leave.

Both can be true at once. Psychological safety and psychosocial hazards describe different things, yet many workplace wellbeing plans treat them as one. When the two blur, organisations can end up running a workshop to fix a workload problem, or assuming a friendly culture means their WHS obligations are covered.

The short answer

• Psychological safety is a shared belief within a team that it’s safe to speak up, ask questions, disagree and admit mistakes.
• Psychosocial hazards are aspects of work, such as high job demands, poor support, bullying or badly handled change, that can cause psychological or physical harm. Employers have a legal duty to manage them.
• Psychosocial safety climate sits between the two: how much the organisation, from the top down, genuinely prioritises psychological health.
• The link: psychological safety helps hazards come to light, but it doesn’t remove them. That takes appropriate controls, often starting with the work itself.

What psychological safety actually means

The term was brought into workplace research by Harvard Business School professor Amy Edmondson. In a 1999 study of work teams, she defined it as a belief shared by team members that it’s safe to take interpersonal risks with one another (Edmondson, 1999). In practice, people will ask the “obvious” question, flag a problem early, disagree with the plan or own a mistake, without expecting to be embarrassed or punished for it.

The evidence base is substantial. A 2017 meta-analysis of 136 samples, covering more than 22,000 people and nearly 5,000 groups, found psychological safety was positively associated with information sharing, learning behaviour and performance (Frazier et al.’s 2017 psychological safety meta-analysis).

It’s also widely misunderstood. Psychological safety is not:

• Being nice all the time. Teams with high psychological safety often disagree more openly, not less.
• Lower standards. Edmondson has argued that psychological safety works alongside high standards and accountability, not instead of them.
• A promise that no one feels uncomfortable. Speaking up is often uncomfortable. The point is that people judge it worth the risk.
• A personal trait. It belongs to the group and its environment, and it’s shaped heavily by how leaders respond.

Psychosocial hazards, in brief

Psychosocial hazards are a work health and safety concept: aspects of work that can cause psychological or physical harm. They can arise from how work is designed and managed, the working environment, or workplace interactions and behaviours. Common examples include high job demands, low job control, poor support, unclear roles, poorly managed change, bullying and harassment. Under Australian WHS laws (or OHS laws in Victoria, where the Occupational Health and Safety (Psychological Health) Regulations commenced on 1 December 2025), employers must identify these hazards and eliminate or minimise the risks so far as reasonably practicable, starting with how work is designed and organised (Safe Work Australia’s Model Code of Practice: Managing psychosocial hazards at work).

NSW has raised the stakes further. Since 1 July 2026, NSW businesses must follow approved WHS codes of practice, including the code on managing psychosocial hazards, or manage the risks to an equivalent or higher standard. SafeWork NSW has named psychosocial risk a regulatory priority and added 20 specialist psychosocial inspectors. In its largest psychosocial compliance blitz, it visited more than 200 workplaces and issued more than 80 improvement notices (NSW Government announcement of the Psychosocial Advisory Service, 22 September 2026). The focus is on whether organisations can show how they identify, manage and review risks in the work itself.

Note what the law does and doesn’t ask for. Psychological safety isn’t a legal requirement. The duty is to manage psychosocial hazards. Psychological safety can help an organisation meet that duty, by making it more likely that hazards are reported and consultation is honest, but it can’t stand in for it.

We’ve set out the full list of hazards, the regulatory context and how organisations can respond on our psychosocial risk programs page. This article focuses on how the ideas connect.

What leaders can change: four everyday moments

Most of this plays out in ordinary moments, not formal processes. Here are four common ones, and what a leader can do differently in each.

1. The team meeting

The usual pattern: the plan is presented, and the meeting ends with “Any questions?” Silence is taken as agreement.

What helps: ask for concerns before the decision is locked in, and make it specific: “What’s the biggest risk in this plan?” or “What would make this hard for your part of the work?” Then thank the first person who answers, especially if the answer is uncomfortable.

2. When something goes wrong

The usual pattern: the first question is “Who did this?” The team learns that reporting a mistake means being blamed for it.

What helps: start with “Thanks for flagging it. What do we need to fix, and what made this easy to get wrong?” The second question often points to a process, workload or training gap, which is a hazard worth addressing in its own right.

3. When someone says the workload isn’t sustainable

The usual pattern: the leader reassures (“it’s just a busy patch”) or suggests better time management. The concern is heard but nothing changes.

What helps: treat it as information about the work. Look at priorities together, be clear about what can and can’t change, and take what you can’t fix to someone who can. This is where psychological safety and hazard management meet: the conversation only happens because the team felt safe to raise it. But raising the issue is only the start. The employer still needs to put appropriate controls in place, which in this case may mean changing the workload, and check whether they work.

4. During change

The usual pattern: news of a restructure arrives with little explanation, and questions are deflected until “more is known”.

What helps: say what you know, what you don’t know yet and when you expect to know more. Ask people what they’re worried about, and pass the themes on. Poorly managed change is itself a recognised psychosocial hazard, and how leaders communicate and consult is a big part of managing it.

The way we listen, ask questions, raise concerns and respond to different perspectives shapes how safe others feel to speak openly. We all have a part to play in those everyday moments, while organisations remain responsible for addressing hazards in the work itself.

The missing middle: psychosocial safety climate

A third idea links the two, and it’s less well known. Psychosocial safety climate, developed by University of South Australia researcher Maureen Dollard with Arnold Bakker, describes employees’ shared perceptions of the organisation’s policies, practices and procedures for protecting worker psychological health and safety (Dollard & Bakker, 2010).

Psychological safety sits at the team level. Psychosocial safety climate sits at the organisational level: whether senior leaders genuinely prioritise psychological health, whether there are real channels to raise it, and whether anything changes when people do. Researchers describe it as a “cause of the causes” of work stress, because it shapes the job demands and resources people experience in the first place.

It matters commercially, too. In a national sample of 4,242 Australian workers surveyed in 2014–15, those in workplaces with low psychosocial safety climate took 43% more sick days a month and had 72% more performance loss at work than those in high-climate workplaces. The researchers estimated the cost to Australian employers at about $6 billion a year (Becher and Dollard’s 2016 report for Safe Work Australia, Psychosocial safety climate and better productivity in Australian workplaces).

Where they connect, and where they don’t

The three ideas are linked. Employers must consult workers about psychosocial risks, and consultation only works if people tell you what’s really happening. A team with low psychological safety will under-report workload, conflict and poor behaviour, which leaves hazards invisible until someone is harmed. Leaders also appear on the hazard list themselves: poor support from supervisors is a recognised psychosocial hazard. When University of South Australia researchers analysed 342 bullying complaints made to SafeWork SA, they traced bullying mainly to people-management practices, such as how work performance is managed, how working hours and entitlements are coordinated, and how workplace relationships are shaped (Tuckey et al., 2022).

But the link only goes so far. A team can feel completely comfortable telling its manager the workload is unsustainable. If nothing changes, the hazard remains. And when people keep raising concerns that go nowhere, their sense that speaking up is worthwhile tends to wear away.

Sexual harassment shows why both matter. It’s a recognised psychosocial hazard under WHS laws, and since December 2022 employers have also had a positive duty under the Sex Discrimination Act to take reasonable and proportionate measures to eliminate it. Yet the external route for people who experience it is under strain. The Australian Human Rights Commission received a record 759 Sex Discrimination Act complaints in the last financial year, up 21% on the year before, and complainants waited close to seven months on average before their case was even allocated (ABC News reporting on the Commission’s complaint figures, 24 September 2026).

Most harassment never reaches a complaint at all. The Commission’s 2022 national survey found one in three workers had been sexually harassed at work in the previous five years, yet only 18% of incidents were formally reported (Time for Respect: fifth national survey on sexual harassment in Australian workplaces). And more complaints don’t by themselves show that harassment is increasing; they may also reflect greater awareness of rights and ways to complain. But the figures underline that prevention and early response can’t be left to external complaint systems. People need to feel safe raising concerns early, and the organisation needs controls that stop the conduct happening in the first place.

Four common mistakes organisations make

• Treating a workshop as the control. Training builds capability. It doesn’t reduce demands, clarify roles or fix a poorly run restructure.
• Making it the individual’s job. Asking people to be braver or more resilient inside a poorly designed job shifts the burden in the wrong direction.
• Measuring the wrong thing. “I feel comfortable speaking up” survey items tell you about the team climate, not the hazards. You need to assess the work as well, and the organisation’s climate can be measured too: Australian benchmark research treats a score of 41 or more on the 12-item psychosocial safety climate scale (PSC-12) as the level linked with good worker health (Dollard et al., 2012).
• Using “psychological safety” to mean nobody gets upset. That shuts down the difficult conversations psychological safety is meant to make possible.

For HR, People & Culture and WHS leaders

• Start with the work. Identify hazards with your workers, drawing on information you already hold: claims, leave, turnover, complaints and survey comments.
• Control risks at the source where you can: workload, role clarity, how change is managed, and the support structures around people.
• Then build capability: leaders who respond well to concerns, and teams that know how to raise them.
• Close the loop. Show people what changed because they spoke up.

If your organisation marked R U OK? Day this September, these steps are how that conversation carries on for the rest of the year. We wrote about that in Beyond R U OK? Day: Building Psychological Safety That Lasts All Year.

How HSG can help

HSG’s psychological safety programs work on the capability side of this picture, as one part of a broader approach:

• Psychological safety training for leaders builds the leader responses described above.
• Psychological safety sessions for general staff help teams practise raising concerns, disagreeing well and learning from mistakes together. Ask us about staff sessions.
• Psychosocial risk programs support an organisation-wide response to psychosocial hazards, alongside your WHS processes.

Talk to us about the right starting point for your leaders and teams. Enquire Now. We respond to all enquiries within 12 hours, or call 1300 889 073.

About the authors

This article was co-written by Kyla Tustin and Michael Stone.

Kyla Tustin is an HSG specialist facilitator with more than 15 years’ experience designing and facilitating leadership, workplace wellbeing and behaviour-change programs, working with thousands of individuals, leaders and organisations. Her approach brings together positive psychology, neuroscience, emotional intelligence and real-world leadership experience. Having led teams in radio and investment banking, she has seen first-hand the impact that pressure, stress, disconnection and leadership can have on people and workplace culture.

Michael Stone is the founder and CEO of Holistic Services Group. He established HSG in 2003 to bring preventive, holistic wellbeing programs into Australian workplaces, and has since led its work with more than 1,600 organisations across Australia and Asia-Pacific.

References

• Australian Human Rights Commission (2022). Time for Respect: Fifth national survey on sexual harassment in Australian workplaces.
• Australian Broadcasting Corporation (24 September 2026). Human rights commission dealing with record sexual harassment complaints. ABC News.
• Becher, H., & Dollard, M. F. (2016). Psychosocial safety climate and better productivity in Australian workplaces: Costs, productivity, presenteeism, absenteeism. Safe Work Australia.
• Dollard, M. F., et al. (2012). The Australian Workplace Barometer: Report on psychosocial safety climate and worker health in Australia. Safe Work Australia.
• Dollard, M. F., & Bakker, A. B. (2010). Psychosocial safety climate as a precursor to conducive work environments, psychological health problems, and employee engagement. Journal of Occupational and Organizational Psychology, 83(3), 579–599.
• Edmondson, A. (1999). Psychological safety and learning behavior in work teams. Administrative Science Quarterly, 44(2), 350–383.
• Frazier, M. L., Fainshmidt, S., Klinger, R. L., Pezeshkan, A., & Vracheva, V. (2017). Psychological safety: A meta-analytic review and extension. Personnel Psychology, 70(1), 113–165.
• NSW Government (22 September 2026). Minns Labor Government launches Psychosocial Advisory Service to address rise in psychosocial incidents in the workplace.
• Safe Work Australia (2022). Model Code of Practice: Managing psychosocial hazards at work.
• SafeWork NSW (1 July 2026). SafeWork NSW redefines its priorities in new 2026-27 Regulatory Statement.
• SafeWork NSW (14 March 2026). New mental health safety inspectors now supporting workers and businesses.
• Sex Discrimination Act 1984 (Cth), s 47C (positive duty).
• Tuckey, M. R., et al. (2022). Workplace bullying as an organizational problem: Spotlight on people management practices. Journal of Occupational Health Psychology. https://doi.org/10.1037/ocp0000335
• Work Health and Safety Act 2011 (NSW), s 26A (compliance with approved codes of practice).