Psychological safety still lags despite gains in employee wellbeing, CEO warns

Despite notable progress by Australian workplaces in prioritising employee wellbeing, the CEO of Workplace Options Australia notes that many staff still hesitate to raise personal or professional concerns.

According to Alan King, CEO of Workplace Options Australia, Australian workplaces are making significant progress in supporting employee wellbeing through initiatives that help normalise conversations about mental health.

“Companies across the globe, including those in Australia, have made strong strides in recognising that employee wellbeing is central to workplace culture and organisational success,” he said.

“Initiatives like R U OK? Day have empowered people to start conversations about mental health, and the introduction of psychosocial risk regulations has placed clear responsibility on employers.”

However, he warned that psychological safety remains a challenge, emphasising that true support goes beyond implementing programs and requires a workplace culture that is genuinely rooted in “trust, respect, and empathy”.

“Yet many employees still hesitate before raising concerns. Effective support goes beyond having programs in place; there must be a culture of trust, respect, and empathy, where speaking up is not just accepted but encouraged and valued – from the CEO to the intern,” he said.

The importance of psychological safety

While fostering psychological safety is not just a matter of legal compliance, King stressed that its implementation is critical to organisational success and delivers benefits far beyond merely adhering to the law.

“Australia is a leading country for creating psychologically safe workplaces because prioritising employee wellbeing is not only a good practice, it is part of the law,” he said.

“But beyond compliance, organisations must understand how psychological safety is key to building strong, sustainable businesses.”

King emphasised that psychological safety is not only a cornerstone of sustainable business growth but also an essential means of helping employees reach their full potential and perform at their best.

“When employees feel seen, connected and valued, they bring forward ideas, flag risks early, and perform at their best. When they do not feel safe to be their authentic self, the consequences are costly: hidden burnout, unreported issues, and a steady loss of top talent,” he said.

“When people feel supported, their wellbeing improves, their commitment deepens, and their performance rises. Retention strengthens because employees are more likely to stay with an organisation where they feel a sense of belonging, where they feel seen and heard.”

Practical steps

To foster a supportive environment, King outlined three practice steps that businesses can take to ensure employees feel supported and heard.

“First, leaders must model openness. When leaders and managers share their own challenges and invite feedback with humility, they encourage others to feel safe and supported,” he said.

“Second, promote trusted communication channels: whether that is providing employee assistance programs, training managers, [or] hosting webinars. It is vital for employees to know there is a place or a person to help them.

“And third, act on feedback. Nothing erodes trust faster than feedback without follow-up.”