MHCC Psychological Injury Management Guide (PIMG)

Change font size: SmallerReset textLarger

2.3: Psychological Injury


Each Australian jurisdiction defines psychological injury differently.

According to section 4 of the  NSW Workers Compensation Act (1987), a psychological injury is "an injurythat is a psychological or psychiatric disorder".

Comcare defines psychological injury as:

"…  the  form of mental injury generally associated with work-related stress … may include conditions such as depression, anxiety, adjustment disorder and post traumatic stress"

In NSW, workers compensation is NOT payable if the psychological injury was caused by the employer's reasonable action in regard to:

  • performance appraisal
  • employment benefits
  • transfer
  • promotion
  • demotion
  • retrenchment
  • dismissal

2.3.2: Workplace stress and psychological injury

For some time now, it has been recognised that there is an association - albeit unclear - between workplace stress and psychological injury.

On the strength of that recognition, the traditional approach to prevention and management of psychological injury emerged, which:

  • focuses very heavily on risk management to prevent, and/or reduce the impact of, workplace stressors
  • assumes that the use of coping strategies mediates the relationship between workplace stressors and employees' psychological well-being.

Recent research has established that factors such as leadership behaviour, workteam climate, individual morale and individual susceptibility mediate the relationship between workplace stressors and psychological injury.

In light of this research, it is recommended that we place a high degree of attention on leadership behaviour,  work-team climate and  individual morale (while continuing to attend to workplace stressors).


Workplace stressors traditionally associated with psychological injury

(Hart and Cotton 2002)

Workplace stressors - risk factors


a. Work workload, work patterns and the work environment.
b. Emotional includes conflict between responsibilities, perceived isolation, emotional labour, traumatic work experience.


How much say the person has in the way they do their work


Encouragement and resources provided by the organisation, line management and colleagues.

Role Clarity

Understanding of the role the employee has within the organisation.


Includes managing conflict, dealing with unacceptable behaviour such as workplace harassment.

Recognition and Reward

Rewarding worker efforts within their work tasks.


The way change is managed and communicated to staff.


The perception of fairness about work procedures and how they are enacted

Preventing and managing workplace stressors

Three different levels of action are usually described to prevent and manage workplace stressors; primary, secondary and tertiary interventions.

Primary prevention addresses the sources of workplace stress and prevents it from occurring in the future; it is proactive, aiming to prevent the occurrence of illness among healthy workers. Secondary and Tertiary Strategies mainly address the effects of stress.

Tertiary and secondary intervention approaches are most commonly used; although the management of injured workers is very important (e.g. return to work), it does not prevent stress in the workplace.


Primary, Secondary and Tertiary Strategies

Adapted from National Institute for Occupational Safety and Health (1999); Brun, Jean-Pierre (2005);
WorkCover NSW (2006, p11);
Lamontagne, Keegel, Louie, Ostry & Landsbergis (2007)


Risk Management approach to workplace stressors

(The State of Queensland - Department of Justice and Attorney-General 2010)

2.3.3: Workplace stressors and psychological injury claims

In regard to psychological injury claims, operational stressors are mediated by  leadership behaviour, work-team climate, individual morale and individual susceptibility.

(Cotton 2012)

2.3.4: Mediators of workplace stress and psychological injury

Individual susceptibility

Certain personality styles - which may not generally be considered problematic at work - may lead to a psychological injury claim if there is  a poor fit between:

  • the employee's personality style and
  • the requirements of their role and/or
  • the culture of the organisation

Personality styles which appear to indicate higher vulnerability to ordinary work stressors and which have a higher association with psychological injury  claims include:

  • high levels of emotionality
  • highly perfectionist traits
  • paranoid and distrustful thinking styles
  • very rigid and inflexible thinking styles
  • high levels of entitlement
  • a tendency to view oneself in a highly positive manner despite contradictory information from supervisors.

(Clements 2009)

(Cotton 2012)


Workplace morale:
Individual morale enables employees to be more resilient in the presence of operational stressors.

Leadership behaviour and work-team climate:  Together, "empathy, clarity, engagement and learning"  explain 80% of the variance in employee motivation and wellbeing.


2.3.5: Morale

Positive emotional states (morale) and negative emotional states (distress) each make independent contributions to overall levels of employee  wellbeing.

Increases in positive emotions have a more significant impact on employee wellbeing than a comparable reduction in levels of negative emotions,  and  problems with wellbeing in the workplace may be caused by low levels of:

  • positive work experiences and
  • positive emotional states (see Morale and psychological injury and Declining morale trajectory)

Developing morale (at organisational and workgroup level)

  • build supportive leadership capability through strategies that foster genuine two-way feedback and enhance leader behavioural integrity;
  • facilitate staff discussion and professional debate to address operational challenges (rather than simply taking a  directive approach)
  • proactively clarify values and behavioural expectations;
  • increasing the level of informal and development oriented feedback;
  • empower representative staff project teams to drive organisational improvement initiatives.                  

(Cotton & Hart 2003, Cotton, 2009)


Morale and Psychological Injury

A decline in morale drives psychological injury more than an increase in the level of distress.

Levels of morale are strongly influenced by

  • Supportive leadership behaviours
  • Quality of work-team climate

This in term effects staff wellbeing and organisational performance.

(Cotton 2009)


Declining Morale Trajectory

(Cotton 2009)

2.3.6: Key drivers of workplace psychological injury

(Cotton 2009)


2.3.7: Preventing psychological injury

The majority of psychological injury claims may be prevented through better management practices and a focus on wellbeing

60% of claims may be prevented by:

  • Improved morale
  • Work team climate
  • Supportive leadership

Develop supportive leadership capability across all levels of management and increased accountability for people-related outcomes ( eg 360° performance appraisals, leadership KPIs climate surveys, feedback)

  • Foster supportive engaging work team climates
    • facilitate staff discussion and professional debate to address operational challenges
    • increase the level of informal and development oriented feedback
    • proactively clarify values and behavioural expectations
    • empower representative staff project teams to drive organisational improvement initiatives
  • Use high quality measurement (eg reliable and valid employee opinion surveys) to identify potential organisational 'hot spots'
  • Identify and respond to early warning signs (eg counterproductive and withdrawal behaviours)

(Cotton 2009, 2012)


Early warning signs - counterproductive and withdrawal behaviours

(Cotton 2009)


2.3.8: Treating Psychological Injury

Poor approaches to treatment Effective approaches to treatment
  • No management of treatment expectations
  • Focus on pre-existing or non injury-related issues
  • Failure to base session frequency and duration on a clinical formulation and use of professional judgment
  • Defer to injured worker to determine future duration and frequency of sessions  (quasi - client empowerment)

associated with …

  • Injured worker develops emotional dependency and expectation of open ended access to treatment
  • Results in unrealised self management capability


  • Measurable treatment effectiveness must be demonstrated
  • Assess and manage psychosocial barriers
  • Empowerment of the injured worker and focus on building self-management capability
  • Functionally-based specific treatment goals
  • Priority use of evidence-based treatments
  • Effective communication with key stakeholders

(Cotton 2009)


2.3.9: How can we support treatment?

Communicate with the injured employee
Keep the employee engaged with the work environment as much as possible, particularly if there is delayed return-to-work

Communicate and cooperate with the treatment provider
Respond quickly to any communication from the treatment provider - in particular, the initial approach.

If the treatment provider does not contact you, make sure you initiate communication promptly.

Emphasis of communication:
When communicating with the treatment provider and employee, focus on:

  • open, clear communication
  • a cooperative, team approach to the employee's recovery and treatment goals
  • willingness to accommodate workplace changes as part of "reasonable adjustment"
  • gradual re-building of the employee's self-management capability
  • psychosocial flags


2.3.10: Treatment outcomes in the workers compensation system

People with workplace psychological injury treated via the workers compensation system typically have worse outcomes than those who are not treated via the workers compensation system.

(Cotton 2010)


Why such poor treatment outcomes via workers compensation system?

(Cotton 2010)


2.3.11: Psychosocial "flags"

"Flags" are used to alert us to  something about a person or their  problem that may be an "obstacle to recovery"

2.3.1 Psychosocial Flags

(Kendall and Burton - 2009, in Watson 2010)


2.3.12: Psychosocial factors that influence return to work

2.3.12 Psychosocial Factors and RTW

(Cotton 2009)

Keep the employee engaged with the workplace and co-workers during recovery.

Check for the presence of the above psychosocial factors  and seek help to address them according to the particular circumstances of the employee and organisation.