How to create a 'psychologically safe' workplace
Building a safe and supportive work environment is about more than just addressing physical safety. It’s about caring for the psychological wellbeing of employees too. So what is a ‘psychologically safe’ workplace and how do you create one? Here’s what the experts say.
What is a 'psychologically safe' workplace?
A 'psychologically safe' workplace is one where people feel a sense of belonging and feel safe to speak up, says Justine Alter, Co-Director and Organisational Psychologist at Transitioning Well. In practice, this looks like a culture where people are encouraged to speak up with ideas, questions, concerns or mistakes, and your team feels safe taking risks.
Examples include being able to disagree respectfully with your manager or being vulnerable with someone without being judged. “It could even be as simple as feeling comfortable bringing up an idea in a meeting, without worrying about how people might respond,” she says.
Why is psychologically safety important?
Psychological safety is critical to manage psychosocial risk (anything that could harm someone’s mental health) and create mentally healthy workplaces. While workplaces have traditionally thought of safety in terms of physical risk, this accounts for the harm from work-related stress and other mental health hazards.
For example, in a psychologically safe work environment, an overwhelmed worker will feel comfortable asking for help. In an unsafe environment, that person may stay quiet and end up feeling more stressed and overworked. This could lead to mental health distress, a potential mental health claim and resignation, says Alter.
All of this goes a long way in supporting employees – SEEK data shows Australians are happiest at work when they feel heard and valued (26%) and safe to speak their mind (16%).
Legal obligations for employers around psychological safety
From a legal perspective, a psychologically safe workplace is one where workers are protected, as much as possible, from psychological harm arising from their work.
In Australia, this falls under the Work Health and Safety Act 2011, which states that ‘health’ includes both psychological and physical safety, explains Mariam Chalak, Senior Associate & Team Leader at Harmers Workplace Lawyers. This means employers are responsible for managing psychosocial hazards in the same way they would physical ones.
These hazards include anything that could harm someone’s mental health, such as bullying, harassment, excessive workloads, poor role clarity, lack of support or exposure to traumatic events. Risks don’t have to be caused internally – someone in a customer-facing role, for instance, might regularly experience harassment.
Failing to provide a psychologically safe workplace opens up employers to legal, reputational and financial risks. First, there are regulatory risks, says Chalak. “SafeWork NSW can issue improvement notices, prohibition notices and penalty notices. Penalties for corporations can reach into the millions of dollars, and HR officers can face personal liability.”
More commonly though, an employee might file a worker’s compensation claim for psychological injury. There’s also the risk of discrimination or sexual harassment claims, as well as claims under the Fair Work Act 2009. These claims can be complex, expensive and difficult to defend.
Beyond the legal risks, your business might earn a bad reputation if past employees speak out or make public claims, which could damage your business long-term.
Five ways to create a psychologically safe workplace
1. Consult your team
Start by checking in with your employees regularly to understand how they’re feeling and if there are any aspects of the workplace that make the feel psychologically unsafe. There are a few ways to do this, says Alter, including through anonymous surveys so employees feel comfortable speaking openly about issues. This helps uncover any potential risks that could lead to psychosocial harm, like poor resourcing or bullying.
Be sure to share updates and results with the team so they know you’re taking feedback seriously. Consider how you can also set up systems to report and address toxic behaviour, such as through management or HR.
2. Take proactive steps to manage risk
Once you’ve identified potential risks, take action to manage them, based on how likely they are to occur and the potential impact to your team. This goes beyond just introducing an employee assistance program (EAP), says Chalak. “Psychological injuries often arise from systemic issues such as chronic under-resourcing, poor change management and unclear expectations.”
Change comes from focusing on organisational systems, not individual behaviour. In practice, this might include improving work design, managing workloads, clarifying roles, and offering training and mentorship for employees of all levels.
3. Build a culture of open communication
Address communication issues within your team and focus on a culture of clear, open dialogue. “We know, for example, that a culture of incivility can not only make people feel unsafe to speak, but it can also be a precursor to more serious risks like bullying and harassment,” says Alter.
A psychologically safe workplace is all about good communication. This means actively listening, taking on board feedback and ensuring everyone feels heard without judgement.
4. Encourage curiosity, not criticism
Speaking up, particularly in meetings or group settings, can be stressful for employees at the best of times – more so if they fear being berated for errors or having their ideas criticised. According to SEEK data, 58% of Australians feel nervous about talking during meetings.
Employers should support a culture that encourages team members to share and explore new ideas rather than shoot them down. If you’re a leader, create a positive feedback loop to motivate your team. Thank them for their input during meetings or bring up that you enjoyed their contributions during 1:1s.
5. Start from the top
As a leader, it’s important to model the culture you want to create in your workplace. It’s up to leadership to foster an environment where team members at all levels feel supported and heard.
According to SEEK data, over half of employees from Australia feel nervous when giving feedback to a leader (55%) or receiving it (52%). Leaders can use these encounters like these to model active listening, curiosity and empathy.
“Psychological safety is not simply an HR initiative,” says Chalak. “It’s a core work health and safety obligation. Increasingly, regulators and courts expect organisations to treat psychosocial risk with the same seriousness as physical risk.”
Creating a psychologically safe workplace starts by addressing the needs of your employees. Leaders can consult with their teams, provide ways for employees to provide anonymous feedback, model supportive behaviour, and always address issues quickly if they arise.
Source: Research conducted for SEEK by Nature, between July and September 2025 via an online survey. Responses were gathered from over 3,000 working age Australians