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How psychological health and safety can positively impact the bottom line

July 23, 2020
By Bill Howatt, Troy Winters and Craig Hrynchuk

(skynesher/Getty Images)

Ultimately, the goals of psychological health and safety programs are to protect employees’ mental health and help them flourish.

To achieve this, leaders need to have empathy and remove the stigma that mental illness is a sign of weakness, which is just not the case.

Leaders who focus on psychological health and safety can also gain a better understanding of those factors’ impact on an organization’s bottom line.

It’s estimated that even before COVID-19 added a new element of stress to the workplace, 500,000 Canadians per week called in sick due to mental health problems.


Mental illness affects employees’ experience and perceptions of what they want and believe they can cope with. The higher the perceived level of stress and the lower the perceived level of coping skills, the more an employee is at risk of mental duress.

Mental health is not about will

By age 40, nearly 50 per cent of employees have had some degree of mental health concern.

This suggests that mental health, like physical health, is not about will — it’s about experiences, genetics and habits.

It would be silly to assume an employee with multiple lifestyle risks such as tobacco use, poor nutrition, lack of physical activity and excessive alcohol use could will off a chronic disease.

Similarly, one couldn’t assume an employee who pushes themselves daily, deprives themselves of sleep, constantly feels anxious, worries about failing, has no authentic social connections in the workplace and feels isolated could will off mental illness.

Exclusive: Take the survey on psychological vulnerability in the workplace

Please complete and share with colleagues the confidential survey Employees’ Perceived Psychological Health & Safety Risk Screen. Talent Canada and Howatt HR are conducting a study to explore how well the Psychological Vulnerability in the Workplace model (outlined below) is working. We’ll be putting our results in a report and sharing it live during Talent Canada’s Workplace Mental Health Virtual Summit on Sept. 15, 2020. Stay tuned to Talent Canada for more information about this must-attend event for leaders, HR professionals and front-line managers.

Understanding the impact of mental illness at work

During COVID-19, 84 per cent of the workforce reported an increase level of concern across 15 factors that impact mental health, according to research from the Mental Health Commission of Canada and the Conference Board of Canada.

Employees who experience mental health concerns are at higher risk for short- and long-term disability claims and sick time.

Employees with mental health concerns tend to experience a reduced productivity level because of lower discretionary effort and higher levels of presenteeism — for example, feeling unwell in the workplace.

In an organization of 1,000 employees earning $75,000, with 200 off sick an average of two days a year and others working below their potential — all due to mental health issues — annual costs could total more than $2.3 million. This number does not include short-term or long-term disability or WCB disability claims.

Mental illness costs business big dollars

Mental illness in the workplace impacts both costs and opportunity. When an employee isn’t working at their full potential, the result is dollars lost — as well as revenue and productivity.

Employers can’t eliminate all mental health concerns. However, the impact of these hazards can be reduced.

In the above example, even a 10 per cent reduction of lost time could result in a more productive use of over $230,000, with a direct and positive impact on the bottom line.

In today’s economy, a person’s mental state and focus can be the difference between success and failure. In fact, regardless of the sector, what an employee thinks will impact what they do.

Human capital potential is impacted by mental health. How employees feel and think impacts how they show up and perform. Their mental health matters greatly for any organization’s long-term sustainability.

Leaders can play an important role in facilitating psychological safety in the workplace by:

  • being an advocate for psychological health and safety in the workplace
  • identifying and reducing the risk for psychological or psychosocial hazards such as fatigue or stress in the workplace
  • becoming a psychologically safe leader.

Bill Howatt is the Ottawa-based president of Howatt HR. Troy Winters is the senior health and safety officer at the Canadian Union of Public Employees (CUPE) in Ottawa. Craig Hrynchuk is the executive director at the Alberta Municipal Health and Safety Association (AMHSA).

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