<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=1052797658146671&amp;ev=PageView&amp;noscript=1">

Understanding the Impact of Psychological Health on Organisational Performance

collab 2Explore the intricate relationship between psychological health and organisational performance.

The Importance of Psychological Health in the Workplace

Psychological health plays a critical role in individuals' overall well-being and performance in the workplace. It encompasses the mental, emotional, and social aspects of a person's well-being, and when neglected, can have detrimental effects on both employees and organisations.

A positive psychological health environment promotes employee engagement, productivity, and satisfaction. It creates a sense of belonging, fosters creativity and innovation, and enhances teamwork and collaboration. On the other hand, poor psychological health can lead to increased absenteeism, presenteeism, turnover, and decreased productivity.

By prioritising psychological health in the workplace, organisations not only fulfil their duty of care towards employees but also reap the benefits of a healthy and thriving workforce.

Factors Affecting Psychological Health

Several factors can impact an individual's psychological health in the workplace. These include workload and job demands, work-life balance, job insecurity, lack of control or autonomy, poor interpersonal relationships, bullying or harassment, and inadequate support from management.

Organisations need to identify and address these factors to create a psychologically safe and healthy work environment. This can be achieved through policies and practices that promote work-life balance, provide employee development and growth opportunities, foster positive relationships, and ensure effective communication and support systems.

Safe Work Australia New Report

Safe Work Australia has published new information identifying workplace psychological health trends. 

The Psychological Health and Safety in the Workplace report highlights the changing impact of work-related psychological injuries in Australia. During 2021-22p:

  • Mental health conditions accounted for 9% of all serious workers’ compensation claims, a 36.9% increase since 2017-18.
  • The median time lost was more than 4 times greater than that of all physical injuries and illnesses (2020-21).
  • The median compensation paid for mental health conditions was more than 3 times greater than that of all physical injuries and illnesses.
  • Workers with claims for mental health conditions experienced poorer return to work outcomes and were more likely to experience stigma from colleagues and their employers.

The report draws from 3 main data sources: the Safe Work Australia National Dataset for Compensation-based Statistics, the National Return to Work Survey, and the People at Work Risk Assessment Survey.

Quotes attributable to Marie Boland, Chief Executive Officer, Safe Work Australia:

“This new report by Safe Work Australia aims to increase understanding of the impact of psychosocial hazards at work by highlighting trends in psychological health in Australian workplaces.

“The data gives insights that can help governments, researchers, industry and worker representatives to address current and future challenges in psychological health and safety.

“Proactively managing psychosocial hazards at work not only protects workers, it also benefits businesses by improving organisational performance and productivity.

“Under model work health and safety laws, psychosocial hazards and risks are treated the same as physical hazards and risks.

“This data report illustrates the importance of Safe Work Australia’s recent work to support workplaces to understand and meet their work health and safety duties in relation to psychosocial hazards, including the development of a model Code of Practice on managing psychosocial hazards at work.”

Measuring Organisational Performance

Measuring organisational performance is crucial for assessing the effectiveness of strategies and initiatives aimed at improving psychological health in the workplace. It involves evaluating key performance indicators (KPIs) that are aligned with the organisation's goals and objectives.

Some common metrics used to measure organisational performance include employee satisfaction and engagement surveys, turnover rates, absenteeism rates, productivity levels, and financial performance indicators. By regularly monitoring and analysing these metrics, organisations can identify areas for improvement and track the impact of interventions on psychological health and overall performance.

Impact of Psychological Health on Organisational Performance

The impact of psychological health on organisational performance is significant. Employees with positive psychological health are more likely to be engaged, motivated, and productive. They experience lower stress, anxiety, and burnout levels, resulting in higher job satisfaction and retention rates.

On the other hand, poor psychological health can lead to decreased productivity, increased absenteeism and presenteeism, higher turnover rates, and increased healthcare costs. It can also negatively affect the organisational culture, teamwork, and innovation.

Organisations can enhance overall performance, increase employee satisfaction, and create a positive work environment by prioritising psychological health and implementing strategies to support employee well-being.

Strategies for Improving Psychological Health in the Workplace

There are various strategies that organisations can implement to improve psychological health in the workplace. These include:

- Promoting work-life balance by offering flexible work arrangements and encouraging employees to take breaks and vacations.

- Providing professional development and growth opportunities to enhance employee skills and competencies.

- Fostering a positive and inclusive organisational culture that values diversity, equity, and respect.

- Implementing effective communication channels and feedback mechanisms to ensure transparency and employee involvement.

- Offering support services such as employee assistance programs and counselling to address mental health issues.

- Providing training and education on stress management, resilience, and mental health awareness.

By adopting these strategies, organisations can create a supportive and healthy work environment that promotes psychological well-being and improves overall performance.


Topics: Occupational Health and Wellbeing, Psychosocial Safety