Workplace stress is a growing concern worldwide. While some stress is a normal part of work, chronic or extreme stress can seriously impact employees' well-being and job performance. According to Beyond Blue, one in five Australian employees has taken time off work due to feeling mentally unwell in the past 12 months.1
Safe Work Australia reports that the rate of work-related injuries and illnesses in Australia remains at 3.5%, including mental health issues caused by job-related stress.2 It's estimated that untreated mental health conditions are costing Australian businesses $11 billion annually, with absenteeism accounting for $4.7 billion, presenteeism $6.1 billion, and compensation claims $146 million. These numbers reflect a growing need for mentally healthy workplaces to support employee wellbeing and organisational productivity.
More recent data highlights the urgency of the issue. In 2022-23, mental health conditions accounted for 10.5% of all serious workers' compensation claims (14,600 claims) — a 19.2% increase over the previous year and a 97.3% rise compared with a decade ago. Over this period, the proportion of claims for mental health conditions grew from 6.4% in 2012-13 to 10.5% in 2022-23.3
This surge represents the second largest growth in serious claims by injury type in the last 10 years, following infectious diseases (driven largely by COVID-19). Importantly, mental health conditions are among the costliest forms of workplace injury, leading to longer absences and higher compensation payouts than physical injuries.
Creating a mentally healthy environment is crucial for employees to thrive. High-level management support is essential for driving mental health initiatives. Employers who prioritise mental health often see improved employee engagement, productivity, and overall workplace culture.
Managing stress is key to creating this healthy environment. Below, we've outlined three effective strategies to reduce stress in your workplace.
1. Create A Relaxing Environment
A relaxed, comfortable work environment can go a long way in reducing stress. Encourage a quiet workspace, allowing employees to listen to music through headphones if they choose. Adjusting the office layout to foster open communication while providing dedicated spaces for work, meetings, and breaks can improve workflow and help employees recharge.
Outdoor spaces such as courtyards can also provide employees with a much-needed break from the office, helping to reduce mental fatigue and improve overall mood.
2. Encourage Mindfulness Practices
Mindfulness helps individuals become aware of their thoughts and emotions, which can reduce workplace stress. Techniques like meditation, affirmations, and reframing negative thoughts enable employees to stay focused on the present and manage stress more effectively.
Encouraging these practices within the workplace fosters a culture of emotional awareness and self-care, which can reduce stress levels and improve mental well-being.
3. Sharpen Communication Skills
One of the most powerful ways to manage workplace stress is through effective communication. Training employees to express their needs and give feedback constructively can prevent misunderstandings and reduce stress. Assertive communication helps workers feel more in control of their workload and relationships.
Leadership plays a crucial role here. By fostering open and empathetic dialogue between employees and management, workplaces can create a supportive environment that empowers workers and reduces stress.
Gallagher Bassett takes a proactive approach to improving the health and wellbeing of your employees, fostering a culture where seeking help is supported and encouraged. Our Health and Wellbeing Program provides a structured framework for the early identification and response to health and wellbeing risks, both at the individual and organisational level. By leveraging data-driven insights, the program empowers employers to act early, supporting healthier, more resilient teams.
Connect with our team of professionals to find out more.
Sources
1"Supporting Mental Health at Work, Beyond Blue, accessed 13 Oct 2025.
2"Key Work Health and Safety Statistics Australia, 2023," Safe Work Australia, 18 Jul 2023.
3"Key Work Health and Safety Statistics Australia 2024," Safe Work Australia, 2 Sep 2024.
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