Work Health & Safety Changes to be Across in 2026

The big change that’s been implemented into Work Health and Safety laws recently is that psychosocial safety is now a core obligation across Australia, no longer a “nice to have” HR issue for businesses.

What does it mean in a nutshell?

Psychological health is treated the same as physical safety
Regulators expect active prevention, not just policies
Directors and senior leaders have personal due-diligence obligations
Penalties for getting this wrong can be very serious

Here’s what you need to know, in more detail.

1. Psychosocial hazards are now explicitly regulated

Under the updated laws, businesses must identify, assess and control psychosocial hazards, such as:

Excessive workload or unrealistic deadlines
Bullying, harassment or sexual harassment
Poor role clarity or poor management support
Remote or isolated work
Exposure to traumatic events
Poorly managed organisational change

If a risk exists, it must be managed using the same approach applied to physical hazards (job design, staffing, systems — not just training).

2. Codes of Practice now set the standard

Most jurisdictions now have an approved Code of Practice on psychosocial hazards, which differ state-to-state. While not legislation, these codes:

Set out what regulators consider “reasonably practicable”
Can be relied on by inspectors and courts
Make it much harder to argue you “didn’t know” what was required

Victoria’s new Psychological Health Regulations and Compliance Code started on 1st December 2025. Find the full document here – we suggest having a read!

3. Directors and officers can be personally exposed

If you’re a director, business owner, or senior leader, you have a legal duty to exercise due diligence (again, differing according to your state), which includes:

Keeping up to date with psychosocial WHS obligations
Understanding psychosocial risks in your business
Ensuring systems, resources, training and reporting are in place
Verifying those systems are actually working

Failure can lead to personal prosecution, separate from the company. So… scroll back up and click on that link to the full code outline if you skipped it the first time 😉

4. Penalties are significant, and increasing

Because psychosocial risks are now clearly WHS risks, breaches attract the same penalties as physical safety breaches:

Category 1 (reckless conduct)
- Up to ~$11.8m for companies
- Up to ~$2.3m for individuals
- Jail time possible (up to 10 years in NSW)
Category 2 & 3 offences
- Up to hundreds of thousands in fines for officers
- Up to millions for organisations

5. Regulators are focusing hard on this (and claims are exploding)

Why the crackdown?

Safe Work Australia reports mental health conditions now account for about 12% of serious claims and the median time lost is around five times other injuries.

Psychological injury claims are rising fast
They last much longer than physical injuries
They cost far more per claim
They are putting serious pressure on workers’ compensation schemes

This is driving:

More inspections
More improvement notices
Greater willingness to prosecute
Less tolerance for “policy-only” approaches

What should business owners do now?

This list is non-negotiable:

Treat psychosocial risks like physical risks: document them, assess them, control them
Review workload, staffing and role clarity: chronic overwork is now a legal risk, not just a culture issue
Train managers: poor people management is one of the biggest psychosocial risk drivers
Update WHS risk registers and policies: make sure psychosocial hazards are explicitly included
Ensure directors get regular reporting: this supports due-diligence obligations
Don’t rely solely on EAPs or wellbeing programs: regulators expect prevention, not just support after harm occurs.

If this read has you anxiously sighing, get in touch so we can help to point you in the right direction. For businesses without internal HR resourcing, it might be time to engage with someone. You can read about Charlotte – one of our wonderful clients who are HR consultants – here.

Remember, exact obligations differ state-to-state, so read up or get advice on yours specifically.