When Performance Management Becomes a Psychosocial Hazard

Late last year, Australia crossed a significant legal threshold in work health and safety enforcement.

For the first time, a Commonwealth employer was convicted for failing to manage psychosocial risks under federal work health and safety legislation.

The case was brought by Comcare against the Department of Defence, following the death of a Royal Australian Air Force technician.

The message from the court was unequivocal: performance management, when poorly designed or executed, can constitute a serious psychosocial hazard.

What Happened?

The Department of Defence pleaded guilty to a single charge under section 33 of the Work Health and Safety Act 2011, admitting it failed to take reasonably practicable steps to eliminate or minimise psychosocial risks to the worker.

The worker, aged 34, was subjected to four separate, poorly implemented, work plans over a six-month period. During that time, he displayed escalating signs of distress and deteriorating mental health. On 28 July 2020, he took his own life while on duty at RAAF Base Williamtown near Newcastle.

The court found that Defence breached its primary duty of care under section 19(1) of the WHS Act by failing to ensure supervisors were properly trained to use a draft work plan procedure that was being applied as a performance management tool.

This was not a failure of policy. It was a failure of practice.

The Court’s Response: Accountability and Public Exposure

Magistrate Thomas also imposed an adverse publicity order, a rarely used but powerful enforcement tool under section 236 of the WHS Act. These orders require an organisation to publicly disclose:

• the offence

• the consequences

• and the penalty imposed

For large employers, particularly government agencies, this is a reputational sanction as much as a legal one.

What Controls Were Available But Not Used?

Comcare’s investigation identified several reasonably practicable controls that were available to Defence but not effectively implemented:

• Training supervisors to recognise when a work plan itself becomes a psychosocial hazard

• Identifying psychosocial risks associated with workers subject to repeated or prolonged performance management

• Actively eliminating or minimising those risks, including:

  • referring workers for medical assessment

  • suspending performance management where distress is evident

Despite clear warning signs, supervisors did not refer the worker to support services, place him on leave, or take steps to reduce the stress and pressure being experienced.

Why This Case Matters

Comcare’s findings cut to the core of modern psychosocial safety obligations:

• The risks were obvious and foreseeable

• Defence already knew about those risks through its own policies and guidelines

• Policies do not mitigate risk unless they are actively applied

• Supervisors knew the worker was struggling and experiencing personal difficulties

• The situation demanded a proactive WHS response, not procedural compliance

In short, the organisation had the knowledge, the frameworks, and the authority to act, but failed to do so.

Key Lessons for Every Organisation

This case should fundamentally reshape how organisations think about performance management.

1. Performance management is a psychosocial risk activity

2. Any training in performance management must explicitly address psychological safety and wellbeing, not just process and documentation.

   
   

3. Leadership capability matters more than policy

   
   

   Managers need practical capability in:

   
   

   empathy and emotional intelligence

   conducting regular, genuine check-ins

   creating psychologically safe conversations

   
   

4. Support pathways must be understood and used

   
   

   Managers must know:

   
   

   what supports exist

   when to engage them

   how to discuss them confidently and appropriately

   
   

5. “Manager discomfort” is a risk that must be managed

   
   

   If a manager is not capable or comfortable conducting performance management, that is a foreseeable risk, not a personal flaw. Organisations must provide support, oversight, or alternative arrangements.

   
   

6. HR and People & Culture are critical control points

   
   

   P&C functions should operate as active subject-matter experts, not passive administrators, providing guidance, escalation pathways, and real-time intervention.

The Bottom Line

This prosecution marks a decisive shift.

Performance management is no longer just an HR process, it is a work health and safety activity with life-and-death consequences.

Boards, executives, and officers should treat this case as a clear warning: If psychosocial risks are foreseeable, and controls are available, inaction is not defensible.

The law has now made that crystal clear.