Psychological Safety at Work: Definition, Misconceptions, Leadership Failures, Neurobiological Harm, and the Legal Duty to Prevent Psychosocial Injury

By Rose Byass Founder of Robust Leaders

Psychological safety has become a popular leadership phrase, but popularity has come with distortion. In many workplaces, “psych safety” is invoked as a cultural aspiration while the legal, ethical, and neurobiological realities of psychological harm remain poorly understood—or actively resisted. The result is a dangerous gap between rhetoric and practice: organisations speak the language of safety while tolerating conditions that predictably injure people, erode performance, and increase liability.

Defining psychological safety

The most widely cited academic definition comes from Professor Amy Edmondson’s seminal work: team psychological safety is a shared belief that the team is safe for interpersonal risk-taking—that people can speak up with questions, concerns, ideas, or mistakes without fear of humiliation, punishment, or exclusion.  Psychological safety is therefore not a personality trait or individual resilience; it is a group-level climate shaped by norms, leadership behaviours, and organisational systems. Importantly, psychological safety is not “soft.” It is a measurable predictor of learning behaviour and performance, because speaking up is the mechanism by which teams detect errors, surface risks, and improve. Edmondson’s research positioned psychological safety as an enabling condition for learning in complex, interdependent work.

What psychological safety is not

Psychological safety is frequently misunderstood in ways that allow leaders to dismiss it or weaponise it:

1. It is not comfort. Psychological safety does not mean people never experience discomfort. In high-performing teams, challenge and candour are normal. Psychological safety means challenge occurs without interpersonal threat.
2. It is not a lack of standards. Psychological safety is compatible with accountability and high expectations. In fact, it is most valuable where standards matter—because people must be able to report risks, admit mistakes early, and ask for help.
3. It is not “being nice.” Politeness can coexist with fear. A courteous workplace can still punish dissent through subtle exclusion, career limitation, or reputational harm.
4. It is not “everyone gets their way.” Consultation and voice are not the same as consensus. Psychological safety enables input; it does not guarantee agreement.
5. It is not cupcake days and group WhatsApp chats sharing photos of babies and dogs.

These misconceptions have consequences. When psychological safety is framed as weakness, leaders can dismiss it as “fragility.” When framed as comfort, leaders can claim it is incompatible with performance. When framed as “niceness,” workplaces can achieve superficial harmony while silencing dissent and normalising harm.

Misunderstanding breeds ignorance—and sometimes arrogance

A central barrier to psychological safety is leadership ignorance about law and duty, particularly around psychosocial hazards. Under Australia’s WHS frameworks, psychological health is not optional; it is part of “health and safety,” and duty holders must manage psychosocial hazards like any other hazard. Safe Work Australia’s materials are explicit: under the model WHS laws, PCBUs must manage psychosocial hazards. Western Australia has moved decisively in this direction. WA introduced psychosocial hazard regulations effective 24 December 2022, requiring PCBUs to eliminate or minimise psychosocial risks so far as is reasonably practicable.  WorkSafe WA also provides a psychosocial hazards code of practice intended to guide prevention and management of psychosocial hazards including bullying, harassment, violence, fatigue, burnout, discrimination and misconduct. Yet legal clarity does not guarantee leadership competence. In many workplaces, managers are promoted for technical skill, tenure, or confidence rather than genuine capability in people leadership and risk governance. This creates a predictable failure mode: leaders make decisions that “feel right,” interpret discomfort as weakness, and view complaints as disloyalty. The arrogance problem emerges when leaders assume they already know what matters—and resist learning because learning would require humility, systems thinking, and accountability.

The training failure: when organisations “throw someone in”

One of the most damaging organisational behaviours is appointing people into human resources, people advisory, or leadership roles without foundational training, then expecting them to manage complex psychosocial and legal risk. This is not merely an operational inefficiency; it can be a form of organisational negligence. I personally experienced a toxic workplace where the person who was 'acting' as HR. I used the word acting as it was seemingly obvious that this person was out of their depth and therefore, creating destruction despite having no HR background and coming from an executive assistant role. That scenario (which is not uncommon across sectors) illustrates why “internal is better than outsourcing” is not always true. The harm is not caused by titles; it is caused by capability gaps in high-consequence roles. Psychosocial complaints require skill in: procedural fairness, evidence assessment, trauma-informed interviewing, conflict de-escalation, bias control, documentation, confidentiality, and lawful decision-making. When an untrained person leads these processes, common outcomes include:

• mishandling complaints and escalating harm
• breaches of confidentiality and retaliation risk
• “performance management” used as a proxy for interpersonal conflict
• inconsistent standards (perceived unfairness)
• poor documentation that undermines defensibility
• leaders being advised incorrectly about legal thresholds and duties

In complex matters, outsourcing to an independent investigator or specialist advisor can be less damaging than internal mishandling. Independence also restores trust where internal HR is conflicted, overloaded, or embedded in power dynamics.

Toxic workplaces and the cost of psychological unsafety

Psychological unsafety is not simply unpleasant; it is physiologically expensive. Chronic exposure to threat—whether through bullying, humiliation, unpredictable leadership, excessive role overload, or fear of retaliation—activates stress systems designed for short-term survival, not long-term cognition. Meta-analytic evidence shows robust associations between workplace bullying and mental health outcomes including depression, anxiety, and stress-related complaints.  Bullying exposure has also been linked with PTSD symptoms in the research literature, reflecting how sustained interpersonal threat can be traumatising. These outcomes translate into organisational loss: absenteeism, presenteeism, turnover, performance decline, safety incidents, and reputational harm. Psychological safety is therefore best understood as a risk control—one that protects health and performance simultaneously.

Neuroscience: what threat does to brains and behaviour

The neuroscience of stress provides a powerful explanatory layer for why toxic workplaces damage people and why “just be resilient” is scientifically naïve. Bruce McEwen’s work on stress and adaptation describes how chronic stress contributes to structural and functional remodelling in key brain regions, including the hippocampus, amygdala, and prefrontal cortex.  The prefrontal cortex supports executive functions—planning, impulse control, working memory, and complex decision-making. Under chronic stress, the balance shifts: threat processing becomes dominant, cognitive flexibility reduces, and emotional reactivity increases. McEwen’s broader synthesis connects chronic stress to “allostatic load”—the cumulative wear-and-tear on body and brain when stress responses are repeatedly activated without adequate recovery. This matters in workplaces because psychologically unsafe environments systematically increase threat exposure:

• Unpredictable leaders increase vigilance (“What will happen if I speak?”).
• Humiliation and blame increase social threat (a strong trigger for stress systems).
• Power misuse and retaliation increase perceived danger and helplessness.
• Role overload and impossible demands sustain cortisol and sleep disruption.

Neuroplasticity means brains adapt to environments. In supportive environments, plasticity supports learning, creativity, and social connection. In threatening environments, plasticity may favour hypervigilance, avoidance, narrowed attention, and “survival behaviours” (silence, appeasement, withdrawal). This is not a moral failing; it is an adaptation to perceived risk.A psychologically unsafe workplace therefore creates a paradox: it demands high performance while biologically disabling the conditions that support high performance.

Psychological safety as WHS duty, not “culture work”

Psychological safety is often treated as a culture or engagement issue, but in reality it sits firmly within work health and safety responsibilities. Modern safety guidance recognises that psychological health must be managed just like physical safety — by identifying risks, addressing them early, and checking that controls are actually working. In Australia, regulators increasingly expect organisations to actively manage psychosocial hazards such as bullying, excessive workload, poor leadership practices and role ambiguity. This isn’t about adding more policies; it’s about how work is designed, how leaders behave, and whether people can raise concerns before harm occurs. Psychological safety matters because it acts as an early warning system. When employees feel able to speak up about workload pressures, bullying, harassment or unsafe practices without fear of blame or retaliation, risks can be addressed early. When they don’t, problems stay hidden, stress escalates, and harm becomes far more likely — regardless of how well-written the policies appear on paper.

Workplace relations law and bullying frameworks

Beyond WHS, Australian workplace relations law also addresses bullying. Under the Fair Work Act, a worker is bullied at work if they are subjected to repeated unreasonable behaviour that creates a risk to health and safety (and the Fair Work Commission can deal with stop-bullying applications).  This is relevant because psychological safety failures often show up as repeated unreasonable conduct, misuse of authority, and systemic tolerance of poor behaviour. Psychological safety is not a substitute for these legal frameworks; it is one of the conditions that prevents organisations from drifting into chronic non-compliance.

The economic signal: mental health claims are rising (and costly)

Workers’ compensation data increasingly reflects the cost of psychosocial harm. Safe Work Australia’s Key WHS Statistics reporting indicates that claims for mental health conditions continued to increase in 2023–24 (preliminary) and account for 12% of all serious claims, with median time lost almost five times that of other injuries and diseases.  This is a stark signal: mental health-related work injury is not a fringe issue; it is a substantial and growing burden. The organisational implication is simple: psychologically unsafe environments are expensive. They drive higher claim severity, longer absences, and greater disruption. They also increase exposure for officers and boards where due diligence expectations require active oversight of WHS risk—including psychosocial risk.

Conclusion: psychological safety is competence, duty, and design

Psychological safety is not a wellness slogan. It is a group-level climate that enables truth-telling, learning, and risk visibility.  It is often misunderstood as comfort or lack of accountability, which allows leaders to dismiss it or implement performative initiatives while ignoring the structural drivers of harm. Meanwhile, contemporary WHS frameworks—especially psychosocial hazard regimes—are making it increasingly clear that psychological health is a core safety duty. When leaders lack legal literacy, resist learning, or appoint untrained people into high-consequence HR and leadership roles, psychological harm becomes more likely—and investigations, claims, and reputational damage follow. The neuroscience is not ambiguous: chronic workplace threat reshapes cognition, emotion regulation, and behaviour, undermining performance and wellbeing.  Compensation trends reinforce the reality that mental injury is rising and costly, with longer time lost than physical injuries. A psychologically safe workplace is therefore best understood as a designed system: leadership capability, clear behavioural standards, fair processes, competent HR and investigation pathways, and genuine risk management for psychosocial hazards. Where those foundations exist, psychological safety becomes not merely a cultural aspiration but an operational asset—one that protects people, strengthens performance, and keeps organisations on the right side of law, ethics, and evidence.