From zero tolerance to zero harm: AKYRA’s Small Businesses Guide on Psychosocial Safety & NonHostile Workplaces
Psychosocial safety is now a compliance issue and NOT just a HR topic. Why “tick-the-box” workplace training no longer works and can potentially cost your business.
Two recent rulings should make every Australian small business owner sit up straight.
In Saunders v Jellinbah Mining [2026] FWC 346, the Fair Work Commission (FWC) upheld the dismissal of a mine worker who broadcast sexually explicit comments over a shared twoway radio.
The Commission called the remarks “egregious,” and emphasised the employer’s clear policies and recent, robust training meant expectations were unambiguous, so enforcing those standards with dismissal was not
harsh, unjust or unreasonable. Put plainly: when you set clear boundaries, train people properly and consistently enforce the rules, you’re on firm ground.
By contrast, the Queensland Industrial Relations Commission’s decision in Loquias v The Star Entertainment Group and Dwyer [2026] QIRC 23 found the employer vicariously liable despite having policies and online modules, because staff were allowed to complete training while “under the pump” doing their jobs.
The Commission said genuine training cannot occur while employees are simultaneously working; rushed, tickthebox modules won’t meet the “reasonable steps” bar to prevent harassment.
These case outcomes sit within a broader legal shift. Since 6 March 2023, the Fair Work Act expressly prohibits sexual harassment connected with work and extends protections to workers, prospective workers and PCBUs (persons conducting a business or undertaking), with employers exposed to liability unless they took all reasonable steps to prevent it.
This is complemented by the Respect@Work reforms, which impose a positive duty to take reasonable and proportionate measures to eliminate, as far as possible, sexual harassment, sexbased harassment and hostile work environments, moving the focus from reacting to incidents to preventing them.
At the same time, psychosocial safety has moved from wellbeing rhetoric to core WHS compliance.
The Model Code of Practice: Managing psychosocial hazards at work sets the expectation that psychosocial hazards (e.g. high job demands, low control, role ambiguity, bullying, customer aggression) must be identified, controlled and reviewed with the same rigour as physical risks.
Training and awareness alone are not sufficient where higherorder controls (like redesigning roles, fixing rosters, improving supervision) are reasonably practicable.
Victoria has gone further, with the Occupational Health and Safety (Psychological Health) Regulations 2025 commencing 1 December 2025, expressly requiring employers to manage psychosocial risks and prioritise higherorder controls.
There’s also a new lens on organisational change. Regulators are scrutinising restructures and technology rollouts for their psychosocial impacts, issuing notices where consultation and planning fall short.
Poor change management (insufficient consultation, inadequate risk assessment of foreseeable impacts, weak transition plans) is increasingly viewed as a potential WHS breach; not merely an HR slipup.
For small businesses, this matters during growth spurts, staffing model changes, new systems or tradinghours shifts.
The Potential Impact for Small Businesses (AKYRA’s Perspective)
- Set standards in plain English and make them local. A Code of Conduct and a RespectatWork policy aren’t paperwork; they are your daytoday compass. Name the actual channels you use (e.g., radios, WhatsApp, Teams); give concrete examples of unacceptable conduct (sexual banter, vulgar language, “jokes” about partners, displays that create a sexualised environment) and state consequences. The Saunders ruling shows that when expectations are clear and recent training exists, decisive action is more likely to be upheld.
- Make training real – protected time, relevant scenarios, short refreshers. Training must be absorbed, not just assigned. Run short (30–45 minute) sessions with people rostered off duties.
Use scenarios from your workplace: what professional radio/chat communication looks like, what to do when a customer becomes abusive, how to intervene early. Capture attendance, reflections and actions. The Loquias case is a blunt reminder: training done “on the fly” while managing live work is below basic expectations. - Treat psychosocial risks like physical hazards. Follow the risk cycle – i.e. identify → assess →control → review.
Start with a quick hazard scan:
a. Are job demands persistently high?
b. Do people know their roles and who to escalate to?
c. Are staff exposed to aggression from customers?
Then implement higherorder controls before relying on training alone e.g. rebalance rosters at peak times, introduce twoperson coverage for highrisk interactions, clarify reporting lines and decision rights, schedule breaks and add debriefs after incidents. This aligns with the Model Code and Victoria’s new regulations.
- Consult early and often… especially in change. Even in a fiveperson team, consultation is still a requirement. Share proposed changes, foreseeable impacts and draft controls, then invite input before decisions are final. Keep notes of what was raised and how it was addressed. Regulators now expect early, genuine and ongoing consultation during transformations, restructures and tech changes.
- Equip managers to intervene and follow through. Leaders need simple scripts for stopping inappropriate behaviour, triaging reports and signposting support. This is essential to fulfilling the positive duty to prevent hostile environments and mitigating against claims under the FWO’s expanded powers to address sexual harassment under the Fair Work Act.
- Close the loop and keep records. Document your hazard identification, why you chose certain controls (i.e. they were reasonably practicable) and when you’ll review them. If a trial roster change reduces spikes in abuse or stress, record the data and roll it in. This “plandocheckact” discipline is exactly what inspectors look for under psychosocial frameworks.
The Practical Bottom Line
The FWC’s Saunders decision underscores that clear standards, recent robust training and consistent enforcement justify firm action when conduct is egregious—even if some remark recipients laugh in the
moment.
The Loquias decision shows the flip side – if training is perfunctory, you can still be liable despite having the “right” documents.
Combined with the Fair Work Act’s prohibition on sexual harassment, the Respect@Work positive duty and new psychosocial regulations, the direction is unmistakable:
- choose controls that matter,
- measure what counts, and
- keep closing the loop.
Safe, welldesigned work isn’t just better for people, it’s the standard by which you’ll be judged in 2026 and beyond.
Two Free Business Tools
Tool #1 | Zero Tolerance to Zero Harm Checklist:
A monthly check to evidence your “reasonable and proportionate”
steps and WHS due diligence.
Tool #2 | Zero Tolerance to Zero Harm Managers Card:
How to intervene early, stay calm and firm, support those
affected, then document and escalate per policy.
Need Help?
AKYRA can support you: We deliver bespoke retained HR and rapid HR PulseCheck diagnostics to surface risk hotspots, strengthen policies and build manager capability.
Where specialist WHS inputs are required (e.g. detailed psychosocial risk assessments), we partner with trusted WHS experts so you get integrated, practical solutions. Give us a call on 07 3204 8830.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice concerning your specific situation.
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