Psychosocial Risk Compliance in NSW and what the 2025 WHS Reforms Mean for PCBUs
7 min read
The legal landscape for psychosocial risk management in New South Wales has shifted again and this time, compliance is no longer optional.
Two major instruments now define how every PCBU must act
The Work Health and Safety Regulation 2025 (NSW), which details how psychosocial hazards must be identified, controlled, and reviewed.
The Industrial Relations and Other Legislation Amendment (Workplace Protections) Bill 2025, which inserts section 26A into the WHS Act, creating a statutory duty to comply with approved Codes of Practice or achieve an equivalent or higher level of safety.
Together, they make psychosocial risk management a mandatory and measurable legal duty.
This article explains what the 2025 reforms require, how section 26A (Act) elevates the Code of Practice to a compliance benchmark, and what evidence PCBUs must now produce.
From Guidance to Legal Obligation
When section 26A took effect on 13 October 2025, the WHS Act requires every PCBU to
Comply with an approved Code of Practice or achieve an equivalent or higher standard of health and safety.
For psychosocial hazards, the approved Code of Practice Managing Psychosocial Hazards at Work (2021) becomes the primary benchmark. Failing to follow the Code or to prove an equal or superior outcome will expose PCBUs to enforcement and prosecution.
This change converts the Code from “guidance” into a statutory performance standard. It also interacts directly with the 2025 Regulation, which prescribes the specific steps PCBUs must take to manage psychosocial risks.
The WHS Regulation 2025 Sections 55C and 55D
Section 55C Managing Psychosocial Risks
PCBUs must eliminate psychosocial risks so far as reasonably practicable, or if elimination isn’t possible, minimise them by applying the hierarchy of control measures in section 36 (Reg).
Section 55D Matters to be Considered
When determining which control measures to implement, PCBUs must consider
the duration, frequency and severity of exposure
how hazards may interact or combine
the design of work, job demands and tasks
the systems of work, including how work is organised and supported
the design and layout of the workplace and its environment and
the information, training, instruction and supervision provided.
These six factors now form the legal checklist for psychosocial compliance.
How Section 26A Changes Compliance Expectations
Before 2025, a PCBU could rely on the Code of Practice as evidence of good practice. After 13 October 2025, compliance with the Code (or proof of an equivalent or higher standard) becomes a duty in itself.
This means SafeWork NSW inspectors will ask
Does the PCBU follow each step of the 2021 Code?
If not, can they demonstrate equivalent or better outcomes, supported by data and documentation?
Do the organisation’s systems satisfy the hierarchy of control and address all section 55D factors?
If the answer to any is “no,” a breach of both the Regulation and section 26A may be established, even without an incident.
The Compliance Triad - Act, Regulation and Code
WHS Act (s 26A)
Purpose - Creates a legal duty to comply with or exceed approved Codes of Practice.
Compliance Expectation - Codes become default compliance benchmarks.
WHS Reg 2025 (s 55C– 55D)
Purpose - Details how psychosocial hazards must be managed using the hierarchy of control.
Compliance Expectation - Evidence must show the PCBU applied sections 36, 55C and 55D.
Code of Practice (2021)
Purpose - Practical guidance for hazard identification, consultation and controls.
Compliance Expectation - Must be followed or exceeded, non-compliance may constitute a breach.
Applying the Hierarchy of Control
Under section 55C, psychosocial risks must be managed using the hierarchy of control in section 36 (Reg).
For example,
Elimination - Remove unnecessary job demands or cease practices that expose workers to repeated aggression.
Substitution or Redesign - Replace direct conflict situations with digital channels or roster redesigns.
Isolation - Separate people from the hazard (physical or temporal separation)
Engineering - Modify workspace layout, install security barriers, or adjust lighting and acoustics to reduce stress.
Administrative - Introduce workload management, consultation procedures and fair rostering systems.
Additionally, you can provide individual Support through counselling or resilience training, only as supplementary controls.
A PCBU must document why each higher order control was or wasn’t practicable, demonstrating the “reasonably practicable” test under section 18 of the Act.
Evidence Regulators Will Expect
Inspectors assessing compliance with sections 55C– 55D and 26A would typically seek
Psychosocial risk registers linking each hazard to hierarchy controls.
Mapping documents showing how Code recommendations were implemented or exceeded.
Consultation records with workers and health and safety representatives HSRs.
Quantitative metrics (incident frequency, overtime hours, survey results).
Review records demonstrating periodic evaluation under sections 37 – 38 (Reg).
Failure to keep or present this evidence may constitute non-compliance.
The Role of Officers and Governance
Officers have continuing due diligence duties under section 27 of the WHS Act.
They must ensure that
psychosocial hazards are integrated into the organisation’s risk management system
adequate resources are allocated
the business has systems to verify compliance with both the Regulation and section 26A (Act).
Boards and executives should now treat psychosocial safety performance as a standing governance agenda item; in some industry sectors this is now essential.
Achieving an Equivalent or Higher Standard
If a PCBU chooses to deviate from the Code, they must prove their approach achieves equal or greater safety outcomes. Examples of equivalent or higher standards include
Implementing ISO 45003 aligned psychosocial frameworks
Using validated psychosocial risk assessment tools with measurable outcomes
Applying higher order controls (redesign, automation, physical barriers) beyond Code recommendations
Integrating continuous performance metrics and independent audits.
It’s important to understand that the Regulator will measure equivalence based on outcomes, not intent.
Practical Steps for Compliance Now
Review existing systems against the Psychosocial Code and sections 55C –55D (Reg).
Identify gaps where current practices fall below Code expectations.
Implement hierarchy-based controls and document decision rationale.
Create a cross-reference matrix showing Code alignment or higher standard achieved.
Train officers and managers on section 26A and Reg 2025 requirements.
Establish quantitative metrics and reporting dashboards.
Common Compliance Pitfalls
Treating psychosocial hazards as HR or wellbeing issues alone, instead of WHS risks.
Relying solely on training or policies (administrative controls).
Failing to document consideration of section 55D (Reg) factors.
Ignoring any shared duty coordination between PCBUs.
Not verifying control effectiveness or updating risk registers.
Key Takeaway
From 13 October 2025, psychosocial risk management moves from guidance to law.
PCBUs must either comply with the Psychosocial Code of Practice or prove they meet an equivalent or higher standard, while also satisfying sections 55C–55D of the WHS Regulation 2025.
Documentation, measurable outcomes, and continuous review are no longer optional they’re evidence of compliance.
Next Steps with Lane Safety Systems
Lane Safety Systems supports NSW organisations to
Audit psychosocial risk systems against the 2021 Code, section 26A and sections 55C– 55D (Reg).
Design hierarchy of control frameworks and measurable performance tools
Deliver officer due diligence training under the new legislation
Integrate psychosocial governance into existing WHS Management Systems.
Contact us today to ensure your organisation is ready for section 26A and fully aligned with the WHS Regulation 2025.
Editor’s Note
The Industrial Relations and Other Legislation Amendment (Workplace Protections) Bill 2025 inserts section 26A into the WHS Act (NSW), creating a duty for PCBUs to comply with approved Codes of Practice or achieve an equivalent or higher standard of safety from 13 October 2025.
The WHS Regulation 2025 (NSW) now refers to provisions as sections, not clauses; this article uses the updated terminology.
This article provides general information only and does not constitute legal advice. Organisations should seek their own professional or legal advice about their specific circumstances.