Workplace harassment & workers comp claims


Rising mental stress claims and preventing workplace harassment


A key message from the Respect@Work: National Inquiry into Sexual Harassment in Australian Workplaces is that “workplace sexual harassment is prevalent and pervasive” yet most people who experience sexual harassment never report it. Another key message is the need to shift from a reactive, complaints-based approach, to one which requires positive actions from employers and board members, with a focus on prevention.


Employers should already be familiar with prevention and risk mitigation in the context of work, health and safety (WHS). In recent years, Safe Work Australia has upped its focus on the prevention of workplace bullying and harassment, including sexual harassment, as known risk factors to psychosocial health and safety in the workplace.


One way to measure the psychosocial health and safety status of Australian workplaces is to measure the prevalence of accepted workers’ compensation claims caused by mental stress. Such claims indicate that an employee has been exposed to one of a range of stressors e.g. harassment or bullying, traumatic events or unreasonable work pressure, that has caused an injury or disease.

Safe Work Australia recently published the 6th annual Psychosocial health and safety and bullying in Australian workplaces statement, which identifies data trends in accepted workers’ compensation claims arising from mental stress, and specifically those arising from workplace bullying and harassment. Overall, the data shows that mental stress claims are rising.

As mental stress claims rise, so does the cost to Australian employers through:

  • lost productivity

  • staff turnover

  • negative impact on workplace culture

  • resources associated with responding to complaints, litigation and workers’ compensation

  • reputational damage


There are a number of preventative measures employers can take to manage the risk of workplace sexual harassment and meet their work health and safety duties. For example:


1. Create a safe physical and online work environment

2. Create a positive and respectful workplace culture

3. Provide information and training on preventing sexual harassment

4. Communicate with your workers

5. Implement safe work systems and procedures

6. Implement workplace policies

7. Manage and address unwanted or inappropriate behaviour early

8. Quickly investigate and respond to reports of sexual harassment

9. Encourage workers to report any sexual harassment

10. Provide safe, supportive reporting pathways


Employers should communicate with their workers throughout each step of the risk management process.


It is worth noting that as of 1 July 2021, new legislation in Victoria enables workers and volunteers who suffer from a work-related mental injury to access "provisional payments" for early treatment and support while they await the outcome of their claim. The new law requires employers and workers comp agents to act faster if a worker or volunteer submits a mental injury claim. Read more >


Following recommendations by the Respect@Work report, the Australian Institute of Company Directors (AICD) commissioned the Clayton Utz Report to provide a practical roadmap of the relevant board-level and legal considerations for effectively responding to workplace sexual harassment.


The Clayton Utz Report provides a Framework for Prevention with recommendations and practical strategies for boards, based on Respect@Works’s Seven domains of prevention and response strategy:

1. Leadership

2. Risk assessment and transparency

3. Culture

4. Knowledge

5. Support

6. Reporting

7. Measuring


When assessing risk, the Framework recommends that “regular and transparent reports should be provided by business units to the Board, senior leaders and external stakeholders in relation to sexual harassment complaints or concerns and the actions undertaken by the organisation in response. In this context, it is incumbent on the Board to ask questions of management regarding the nature and prevalence of sexual harassment in the workplace and ensure that workplace sexual harassment reporting features regularly on the Board agenda.


The Clayton Utz Report contains several practical case studies and advises that “board members have a responsibility to take action against sexual harassment, including not to tacitly condone misconduct due to an individual's seniority or their importance to the financial stability of the organisation” and that “leaders should be visible and proactive in their efforts to address sexual harassment, challenge inappropriate conduct and celebrate positive behaviour in the workplace.”


For more information or tailored support, please contact us today.