Two landmark WHS prosecutions - one against the Commonwealth Department of Defence and the other against Court Services Victoria - show precisely what Australian regulators and courts are now testing employers against on psychosocial risk: not whether harm occurred, but whether an employer could demonstrate it had identified and controlled a foreseeable hazard beforehand.
In December 2025, the NSW Local Court fined Defence $188,000 - the first conviction of a Commonwealth employer under federal WHS law for failing to manage psychosocial risk - after a Royal Australian Air Force technician took his own life in 2020 following six months on four separate performance management Work Plans. The court found Defence had breached its primary duty by failing to train supervisors to recognise the plans themselves as a psychosocial hazard, regardless of their stated intent.
In Victoria, Court Services Victoria was fined $379,157 in October 2023 after a toxic workplace culture at the Coroners Court, running from 2015 to 2018, contributed to an employee's death and drove multiple others to stress leave. The court found CSV had failed to take any adequate steps to identify or assess the psychosocial risks building up over that entire period.
Both cases turned on the same failure: employers that could not show a documented, proactive process for identifying and controlling psychosocial hazards, as distinct from wellbeing programs or policies that existed on paper but were not applied when it mattered.
That distinction now functions as an inspection framework. When regulators examine psychosocial risk, the areas they test specifically include risk assessments, workload and fatigue management, performance management processes, organisational change planning, worker consultation, leadership capability, and governance and reporting. The recurring gap across enforcement actions is not the absence of a written policy - most employers have one - but the absence of evidence that it was actually used: risk assessments that never address workload or role design, consultation records that were never kept, and leadership training that existed as a module but was never applied to real decisions.
The Defence case sharpens that point further. Performance management processes - used routinely by almost every employer with a large workforce - were themselves identified as a psychosocial hazard when they were applied intensively without supervisors being trained to recognise the risk signs. That finding has direct implications for any employer running structured performance improvement processes, which includes virtually every corporate client a management liability broker advises.
For brokers advising clients on management liability, WHS-related covers and workers' compensation, the combined total of $567,157 in fines across these two cases is less instructive than what the courts actually required to make them. Both convictions rested on regulators being able to show that the employer knew, or should have known, about a foreseeable psychosocial hazard and had no documented evidence of having assessed or controlled it.
Clients able to show structured, documented psychosocial risk assessments, consultation records, and evidence that leadership capability was actively developed in psychosocial risk recognition are in a materially different position - both with the regulator and at claim time - than those relying on an employee assistance program and a policy document that has not been reviewed since the regulations changed.
The renewal conversation this prompts is specific: can the client demonstrate a process, not just a policy? If the answer is no, the exposure is real and the documentation gap is fixable before it becomes the centre of a prosecution.
