When investigations become hazards
Psychosocial risks in workplace investigations and what employers can do now
This article was written by Kate Peterson, Nathan Roberts and Nathan Leivesley of McCullough Robertson and originally published on https://www.lexology.com/
A worker is told to leave her job of 14 years. The letter gives her no particulars beyond a reference to interactions with multiple staff members over several years. She goes home and attempts suicide.
That is the human backdrop to Secretary, New South Wales Department of Education v SafeWork NSW (No 2) [2026] NSWIR Comm 1014, handed down by Commissioner O’Sullivan on 2 March 2026. The decision is significant not because of its facts alone, but because of what it confirms about the obligations every Australian employer carries when it subjects a worker to a workplace investigation.
In short: the investigation process itself is a psychosocial hazard. How you design it, how long it runs, what work you give the employee while it continues, and whether you follow your own policies, all carry direct work health and safety consequences.
Background: The WHS compliance context for psychosocial hazards
The employee, referred to as A, was a Business Manager at a NSW Department of Education school where she had worked for approximately 14 years. On 4 April 2023 she was advised by correspondence from the Executive Director of the Department’s Professional and Ethical Standards Directorate (PES) that she was the subject of a misconduct investigation, that she was to leave her workplace immediately and not return, and that she was to perform alternative duties at a separate location. No particulars of the allegations were provided at that point.
After receiving the letter, A attempted suicide. Fortunately, the attempt was unsuccessful.
A letter of allegations was not issued until 5 July 2023, some three months after she had been stood aside and requested a review of the decision (on 10 April 2023). By the time the improvement notices were issued on 6 February 2024, the investigation had been running for approximately 10 months. The allegations, which included conduct perceived as bullying, misuse of procurement processes, and interference with a colleague’s email account, were ultimately resolved with a caution and reprimand, after some (but not all) grounds were substantiated.
In November 2023, A complained to SafeWork NSW about the psychosocial hazards arising from the length of the investigation, the lack of communication, and the nature of her alternate duties. SafeWork Inspector Toole investigated, issued section 155 notices, and on 6 February 2024 issued two improvement notices against the Department.
The Improvement Notices
The First Notice (7-468009) alleged contravention of section 19 of the Work Health and Safety Act 2011 (NSW) (WHS Act) and clause 55C of the Work Health and Safety Regulation 2017 (Regulation) on two grounds:
- the Department’s system of work did not ensure investigations regarding misconduct and performance of workers were completed in a timely and expeditious manner; and
- the Department had no process or prescribed timeframes for providing formal, regular, and documented updates to workers while an investigation was underway.
The Second Notice (7-468011) also alleged contravention of section 19 and clause 55C, on the basis that workers were allocated alternate duties during investigations that were not commensurate with their substantive position, duties, and functions.
Both notices directed the Department, as far as was reasonably practicable, to review, implement, and maintain a safe system of work, consult with workers in its development, review and revise it as necessary, and provide information and training on it.
The legal framework
The WHS Act prescribes a primary duty of care under section 19, requiring a person conducting a business or undertaking (a PCBU) to ensure, so far as is reasonably practicable, the health and safety of its workers, including psychological health. The Act defines ‘health’ to include psychological health.
Clauses 55A to 55D of the Regulation, which came into operation on 1 October 2022, operationalise that duty in respect of psychosocial hazards. A ‘psychosocial hazard’ is defined in clause 55A as one that arises from, or relates to, the design or management of work, the work environment, plant at a workplace, or workplace interactions or behaviours, and may cause psychological harm.
Clause 55C requires a PCBU to manage psychosocial risks in accordance with Part 3.1 of the Regulation and to implement the control measures required by clause 55D, which in turn requires elimination or minimisation of those risks so far as reasonably practicable.
Improvement notices under section 191 of the WHS Act may be issued where an inspector reasonably believes that a person is contravening a provision of the Act or has contravened it in circumstances that make a repeat likely. External review before the Industrial Relations Commission (IRC) under section 229 is conducted as a de novo merits review: the Commission must arrive at the correct or preferable decision, standing in the shoes of the original decision maker, with all matters being considered afresh.
Key findings
Psychosocial hazard provisions: workable and binding
As part of Ground 1, the Department argued that clauses 55A to 55D were too unclear as to what is meant by a PS hazard and what is meant by psychological harm, to be applied, that the various codes of practice provided inconsistent definitions of psychosocial injury, and that it was effectively impossible for a PCBU to know what compliance required. It further argued that ‘psychological harm’ under clause 55A(b) required an objectively identifiable, clinically recognised condition.
Commissioner O’Sullivan rejected these arguments. Clauses 55A to 55D do not impose standalone obligations independent of section 19; rather, they operationalise the existing primary duty by specifying how psychosocial hazards are to be identified and controlled. The duty to manage psychological health pre-dated the regulations. The NSW Code of Practice makes clear that individual differences in how workers respond to psychosocial hazards do not excuse a PCBU from its obligations to identify, assess, and respond to PS hazards. This is consistent with the approach of Scotting DCJ in SafeWork NSW v Western Sydney Local Health District (No 3) [2025] NSWDC 48, where his Honour observed that stress affects individuals differently, but that the duty to eliminate or minimise the hazard so far as reasonably practicable remains.
Investigations are inherently psychosocial hazards
The Commission confirmed that any misconduct investigation into a worker will expose that worker to a psychosocial hazard. Commissioner O’Sullivan relied on Scotting DCJ’s observation at paragraph [26] of Western Sydney that it would be highly unusual for a worker subject to a workplace investigation not to suffer some stress, even if entirely innocent and later exonerated. The question is not whether the hazard exists. It does. The question is whether the PCBU has adequate controls in place to eliminate or minimise the resulting risk so far as is reasonably practicable.
System adequacy: timeliness
The Department’s Guidelines provided that investigations should generally be concluded within three months, as a guide only. The Commission found that this ‘guide only’ timeline, without further safeguards to ensure timely completion, was inadequate. The investigation into A ran for approximately 10 months as at the date the notices were issued. The Department’s explanation that the investigation was complex did not withstand scrutiny when examined against the nature of the allegations actually made.
The Commission drew on Commissioner Muir’s findings in Killen v SafeWork NSW and NSW Rural Fire Service (No 3) [2022] NSWIRComm 1017, where an investigation into bullying-type conduct that ran for more than 12 months was found to require regulatory intervention. A system of work that permits investigations to drag on without meaningful procedural safeguards is not merely suboptimal. It is a contravention.
Alternate duties: commensurate work is required
Inspector Toole formed the view that A’s alternate duties, which were supernumerary in nature and left her with little or no meaningful work to perform on a daily basis, exposed her to the further psychosocial hazards of role underload, role conflict, and lack of role clarity, as well as the social hazard of having to explain her circumstances to colleagues who inquired about her situation [para 77 of Inspector Toole’s evidence].
The Second Notice, which required the Department to ensure alternate duties were commensurate with the worker’s substantive position, was upheld in full. The Commission agreed with SafeWork’s contention that placing A in a lower administrative role at a different school was not justified by the nature of the allegations. Appropriate management of psychosocial risk during an investigation requires more than removing the employee from their usual role. It requires ensuring the replacement work is genuinely suitable.
One worker’s complaint can ground a systemic notice
The Commission addressed the apparent tension between a notice directed at the Department’s entire workforce and an Inspector’s investigation limited to one employee’s experience. The Commission made clear that this presents no difficulty where the notice is directed at a general class of risk rather than a specific inciden. It is sufficient that the risk falls within a class of risk that the PCBU should reasonably have foreseen: Director of Public Prosecutions v Vibro-Pile (Aust) Pty Ltd (2016) 49 VR 676 at [3]-[6], applied by the Commission at [100]. The fact that the Inspector’s investigation was based on one case does not limit the scope of an improvement notice to that case.
Where the Department partially succeeded: the fatal cross-examination concession
The elements of the First Notice that did not survive were paragraph (b), relating to the absence of prescribed timeframes for regular documented updates to workers during investigations, and the direction in paragraph 1.b.
In cross-examination, Inspector Toole was taken to the Department’s Guidelines, which provided for written updates to workers at least once per school term. She was asked whether that system of work was adequate to meet the requirements of the WHS Act. She answered yes. She was then asked whether she formed the view, when issuing the notice, that the system of work in relation to reporting to employees was deficient. She answered no, confirming that ‘it just hadn’t occurred in this case’.
That concession, that the system of work did not contravene section 19 and clause 55C, was critical. Drawing on Commissioner McDonald’s analysis in Catholic Healthcare Limited v SafeWork NSW [2025] NSWIRComm 1046, Commissioner O’Sullivan held that the Commission cannot substitute its own reasonably formed belief for an infirm belief held by the Inspector. If the Inspector did not in fact hold the requisite belief in relation to a particular limb of a notice, that limb must be set aside, even if the circumstances would have justified the belief. The description of the contravention in paragraph (b) and the corresponding direction (paragraph 1.b) were accordingly removed from the First Notice.
The practical lesson is important: what the Inspector says under cross-examination is not merely evidentiary. It can determine the validity of the notice itself.
Practical Implications for Employers
This decision reinforces and extends the obligations identified in Killen and Western Sydney. Taken together, these cases now establish a clear framework for what is required when an employer conducts a workplace investigation. Employers conducting investigations should review their practices against the following considerations.
- Timeliness safeguards, not just guidelines. A ‘guide only’ timeframe with no procedural safeguards for monitoring, escalating, or resolving delays is inadequate. Systems of work must include real accountability mechanisms to ensure investigations are conducted expeditiously.
- Commensurate alternate duties. Placing a worker in a lower-grade, supernumerary role during an investigation is not a neutral administrative step. It is itself a psychosocial hazard requiring risk management. Alternate duties must be genuinely commensurate with the worker’s substantive role.
- Early and adequate communication. Workers should be provided with the particulars of allegations promptly. The gap in this case between the direction to leave the workplace (4 April 2023) and the provision of allegation particulars (5 July 2023) was three months. That gap created foreseeable and serious psychological risk.
- Policy must be followed, not just documented. The Department had a system of work. It was not followed in A’s case. The existence of good documentation does not insulate an employer from regulatory action where the documented system is not applied.
- Systemic risk from individual cases. A single workplace complaint can give rise to an improvement notice directed at an entire workforce. Employers should not assume that isolated incidents are beyond regulatory reach.
In summary
Secretary, NSW Department of Education v SafeWork NSW (No 2) is an important decision for any organisation that conducts workplace investigations. It confirms that the investigation process, standing alone, is a psychosocial hazard requiring active management. It establishes that ‘guide only’ timelines without active enforcement mechanisms will not satisfy the duty. It confirms that alternate duties must be genuinely suitable, not merely available. And it demonstrates that a single worker’s experience can expose systemic inadequacy.
At the same time, the decision is a reminder that improvement notices are not beyond challenge. The limb that fell in this case fell because the Inspector conceded, under cross-examination, that the relevant system of work was not in fact deficient. Procedural rigour in external review proceedings remains essential.
For employers, the message is clear: the gap between a documented investigation policy and how that policy is actually applied in individual cases is where psychosocial risk, and regulatory exposure, lives.
