What Changed In NSW Psychosocial Hazards Compliance From 1 July 2026?

New NSW work health and safety requirements took effect on 1 July 2026, changing how employers demonstrate compliance when managing psychosocial hazards. Adriana and Joel explain what the reforms mean and the practical steps organisations should take.

From 1 July 2026, NSW employers and other persons conducting a business or undertaking must either comply with an approved code of practice, including the NSW Code of Practice: Managing psychosocial hazards at work, or demonstrate that their alternative approach provides an equivalent or higher standard of health and safety. For psychosocial hazards, this means having a documented, proactive and evidence-based system for identifying risks, implementing controls and reviewing whether those controls are effective.

In recent years, psychosocial hazards have been a work health and safety issue hiding in plain sight. Bullying, harassment, workplace violence, excessive workloads, poor role clarity and poorly managed organisational change have all sat within the scope of employer WHS obligations. What has changed is not the existence of those duties, but the extent to which NSW employers must now be able to demonstrate compliance.

From 1 July 2026, approved NSW codes of practice have taken on a new significance. Under new section 26A of the Work Health and Safety Act 2011 (NSW), persons conducting a business or undertaking (PCBU) must either comply with an approved code of practice or be able to demonstrate that they are managing risks using an approach that provides an equivalent or higher standard of health and safety.

One of the most significant codes affected by the change is the NSW Code of Practice: Managing psychosocial hazards at work. This article explains the Code and suggests measures employers should take to ensure they comply.

Why has the NSW Code of Practice become more important?

Historically, codes of practice have operated as practical guidance on how businesses might meet their WHS obligations. Regulators and Courts could rely on them as evidence of what was reasonably practicable in the circumstances. However, employers could adopt alternative approaches provided those approaches met the required standard.

The new NSW framework means employers must now either follow the Code or be able to prove that their alternative system achieves an equivalent or higher level of protection. In practical terms, the Code now operates as a benchmark for compliance, not merely as optional guidance. That makes it important evidence of what a regulator or Court may expect from a compliant psychosocial risk management system.

What does the NSW psychosocial hazards Code require employers to do?

The Code requires NSW PCBUs to use a systematic risk management process for psychosocial hazards. Employers should identify hazards, assess the risks, implement control measures and review whether those controls remain effective.

Importantly, psychosocial hazards should not be treated as isolated employee relations issues or addressed only after complaints arise. The focus is on proactive risk management.

The Code identifies a range of common psychosocial hazards, including:

• high job demands and excessive workloads
• role conflict and poor role clarity
• low job control
• inadequate support
• workplace violence and aggression
• bullying
• harassment, including sexual harassment
• poor consultation regarding organisational change.

In consultation with workers, employers should:

• identify psychosocial hazards
• assess the risks arising from those hazards
• implement control measures
• review the effectiveness of those controls.

This is the same risk management framework employers must apply to physical hazards in the workplace.

Why are policies alone not enough to manage psychosocial hazards?

A policy alone is unlikely to be enough because psychosocial risk management depends on how work is designed, organised and performed. Employers need to show what they have done in practice, not simply that a policy exists on an intranet or in a folder.

SafeWork NSW's approach emphasises the importance of higher-order controls where reasonably practicable. For example, redesigning workloads, reallocating resources, clarifying reporting lines or improving consultation processes will generally be more effective than relying solely on training, employee assistance programs or complaint procedures after problems occur.

Employers should expect regulators to ask not merely whether a policy exists, but what steps have been taken to identify psychosocial risks, what controls have been implemented and how the effectiveness of those controls is being monitored.

Why should NSW employers act now?

The increased regulatory focus is occurring against a backdrop of rising psychological injury claims and increasing enforcement activity. According to SafeWork NSW, the regulator has received more than 2,200 requests for service and more than 190 notifiable workplace incidents involving psychosocial hazards.

Those figures reinforce that psychosocial hazards are no longer viewed as secondary workplace issues. Regulators increasingly regard them as a core WHS risk requiring the same level of attention as physical safety risks.

For officers and senior leaders, the reforms also serve as a reminder that psychosocial hazards are squarely within the scope of WHS due diligence obligations. Understanding psychosocial risks, ensuring appropriate systems are in place and verifying their effectiveness should be regular governance considerations rather than annual compliance exercises.

What should NSW employers do now to comply?

Practical compliance checklist

• Map psychosocial hazards across roles, teams and work types.
• Consult workers about workload, role clarity, support, behaviour, change management and other psychosocial risks.
• Assess the likelihood and seriousness of harm arising from those hazards.
• Prioritise higher-order controls, such as workload redesign, resource allocation, clearer reporting lines and improved consultation.
• Document the controls implemented and the reasons they are considered effective.
• Set review points to test whether controls are working and whether further action is needed.
• Ensure officers and senior leaders receive regular reporting on psychosocial risk and control effectiveness.

NSW employers should urgently review whether they have a documented and evidence-based process for identifying psychosocial hazards, assessing risks, implementing effective controls and reviewing those controls over time. The regulator is unlikely to accept that a psychosocial hazards policy alone is enough. It will expect to see a systematic and demonstrable risk management process embedded into the way work is designed and managed.

If this is not done, employees may be at risk. Additionally, the organisation (and its officers and senior management) may be at risk of prosecution and significant monetary penalties for contravening the WHS Act.

Frequently asked questions about NSW psychosocial hazards compliance

1. Does the NSW Code of Practice apply to psychosocial hazards?

Yes. The NSW Code of Practice: Managing psychosocial hazards at work applies to psychosocial hazards such as high job demands, bullying, harassment, violence and aggression, poor role clarity, low job control, inadequate support and poorly managed organisational change.

2. Can an employer use a different approach from the Code?

An employer may use a different approach, but it must be able to demonstrate that the alternative provides an equivalent or higher standard of health and safety. In many cases, that will require clear evidence of the hazards identified, controls implemented and reviews undertaken.

3. What evidence should employers keep?

Employers should keep records of worker consultation, risk assessments, control measures, training, governance reporting, review dates and any changes made after controls were tested. This evidence will be important if SafeWork NSW asks how psychosocial risks are being managed.