For many working at charities and Not-For-Profit organisations, emotional demand can present as a high risk, with chronic resource constraints and exposure to difficult subject matter creating an environment uniquely vulnerable to psychosocial hazards. As a result, Work Health and Safety regulators are paying closer attention to psychological impacts in this space, rather than only physical injury.
We spoke with Greg McCann, Partner at HWLE Lawyers, about where charities and NFPs are most exposed on psychosocial risk, and what boards need to be doing about it.
Q: Why is psychosocial risk an issue for charities and NFPs specifically?
A:
Every jurisdiction in Australia now regulates psychosocial hazards with the same seriousness as physical hazards, and charities sit in a uniquely exposed position. Staff and volunteers are routinely working in emotionally demanding roles supporting vulnerable people, often under real resource and workload pressure, which is precisely the combination that produces vicarious trauma and compassion fatigue. Regulators expect that risk to be identified and systematically managed, not absorbed as an accepted cost of mission-driven work.
Q: A lot of organisations rely heavily on volunteers. Does that change their obligations?
A:
It's the most common misunderstanding I see. The moment an organisation employs even one paid worker, it becomes a Person Conducting a Business or Undertaking (PCBU) (or an employer, under Victoria's slightly different model), and its WHS duties extend to volunteers as well as staff. A genuine volunteer association with no paid employees sits outside the WHS framework, but very few organisations of any size actually meet that narrow description, and boards shouldn't assume they qualify without checking.
Q: Vicarious trauma and compassion fatigue get mentioned a lot. Are they recognised legal risks, or more of a wellbeing concept?
A:
They're squarely legal risks now. The High Court's decision in Kozarov v State of Victoria confirmed that vicarious trauma arising from sustained exposure to distressing material, was a foreseeable psychiatric risk and the employer held a positive duty to manage. That reasoning applies directly to caseworkers, support workers and volunteers in the charity sector who carry a similar exposure.
Q: What does it look like when this goes wrong? Are there cases charities should be paying attention to?
A:
Several recent cases make the consequences very clear. LiveBetter, an NFP disability service, was fined $675,000 after a client suffered fatal injuries during personal care, with the court finding the organisation had relied on informal, on-the-job practices rather than documented risk assessments and procedures. Amicus Community Services was fined $370,000 in Victoria over a client death, again because documented safety procedures existed on paper but weren't consistently enforced in practice. Both cases turn on the same point: having a policy isn't the same as having a system that's actually followed.
Q: Where do organisations most commonly get it wrong in trying to manage this?
A:
It's important to prioritise the systems and operational design that have attempted to manage the risks first, such as workload limits and job structures, before leaning on training or wellbeing initiatives. Regulators expect organisations to work through elimination and redesign before relying on measures that place the burden of managing the risk back on the individual worker.
Q: What does a board or executive team need to do to satisfy their due diligence obligations relating to WHS?
A:
Due diligence isn't passive and must be actively managed. It is the responsibility of directors and officers to ensure their knowledge of psychosocial risk is current, where these risks are occurring in their organisation's operations, and verify that staff and management are adhering to and using the resources, reporting channels and processes in place to mitigate these risks. That verification step is where boards most often fall short.
Q: What's the one practical step you'd tell a charity or NFP leader to take this week?
A:
Go back to your last psychosocial risk assessment, if one exists, and check whether it was built through genuine consultation with staff and volunteers, drawing on incident data, leave patterns and workers compensation claims, rather than a generic template. If you can't point to that evidence trail, that's your starting point, well before the next audit or, worse, the next incident finds it for you.
Keen to learn more?
Greg McCann is presenting Hidden Dangers in Plain Sight: Managing Psychosocial Hazards in Charities and NFPs at our one-day online masterclass for charity and NFP leaders on Thursday 3 September 2026. Find out more and register here.
