Calculating the Cost of Psychological Injury in the Workplace

Psychological conditions were the third most prevalent factor in preventing people from returning to work following a workers’ compensation claim, according to recent research from workplace health and safety consultancy Konekt.

The company analysed a sample of more than 18,000 workers’ compensation claims in the 2018 financial year and found that a significant portion of these claims were mental health-related, including 22 per cent of all cases referred by Comcare, 10 per cent of all direct and company referrals in NSW, 12 per cent of similar referrals in Victoria and 9 per cent of similar referrals in South Australia.

The mean cost of individual workers’ compensation claims ranged from $1389 to $2687, and in the 2018 financial year, it was found that the delay to referral for mental health condition averaged 108 weeks, which Konekt said leads to a significantly higher case cost, poorer work outcomes and a longer overall case duration.

This referral to delay, paired with a rising incidence of mental health conditions, will result in a future where more will suffer from the detrimental effects of workless-ness, significant impacts on workplace productivity, as well as unnecessary social and family trauma, according to Konekt.

“This will in turn result in a higher cost for Australian society as a whole, with wage and welfare payments on the rise,” said Konekt.

When comparing the current situation to that of 2016, Konekt found that welfare and wages support via the disability support pension has increased by $300 million per annum.

These figures could significantly improve if workplaces had a better understanding of how to identify and respond to mental health issues in a timely manner, according to Konekt’s workplace psychology specialists, Communicorp, which said significant improvements could also be made if mental health was approached in a preventative manner.

Article originally published by the Safety Institute of Australia.